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October 26, 2004
../ Spitzer Focusing On Payola
As reported in Digihear? earlier, New York State Attorney General, Eliot Spitzer, is investigating independent radio promoters who work for
record labels to get airplay for their artists.
Futuremusic reported earlier that Spitzer had served subpoenas to Sony-BMG, Universal Music Group, EMI Group and the Warner Music Group seeking
any link to independent promoters who use every weapon in their arsenal to influence radio programmers to play their clients songs. The major
labels have used middlemen for years as a method to get around the Payola laws that were created to thwart bribes to radio stations. (If you'd
like to learn more about Payola, check out "Hit Men" by Fredric Dannen Ed.)
The role of the independent promoter has been severely diminished since the heyday of the 80s and early 90s when Congress deregulated the
industry in 1996. In fact, two of the biggest broadcasting conglomerates, Clear Channel and Cox Radio, have ceased all interaction with
middlemen. However, Spitzer may be looking into how the major labels are dealing with smaller stations that exclusively play niche genres such
as Latin and Urban. Independent promoters still thrive in these markets and often receive one lump payment to promote as they see fit.
The Future: Spitzer is probably 15 years too late to really get any big convictions from the majors. He's also a little out of his
jurisdiction here as well, but he may try and make the case for the little guy. Many small artists can't afford to pay an independent promoter
to market their music effectively and this unfairly restricts their opportunities. However, with all that the major labels have gone
through in the past few years with piracy, bootlegging, etc. is it really worth kicking the industry in the groin when they're just getting
back up on their feet?
>>> Digihear? October 2004
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News Archives
Digihear? Stories: September 2004
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