Spitzer Scores Sony Payola Settlement

When I started the radio show in 1991, I met many label reps who started our conversation with "so, how much do you charge?" A look of puzzlement then came over their face as I assured them I wasn't charing money for interviewing artists.

The game may have gotten more subtle since then (I rarely have reason to deal with the majors anymore so can't say firsthand), but you can be sure it hasn't gone anywhere, and won't be going anytime soon. Impressive that Spitzer was even able to make a dent in it, though. If making Sony give up 3 minutes worth of profit counts as a dent.

Sony Agrees to $10M 'Payola' Settlement

Recording industry titan Sony BMG Music Entertainment agreed Monday to pay $10 million and stop bribing radio stations to feature its artists in what a state official called a more sophisticated generation of the payola scandals of decades ago.

The agreement springs from an investigation by New York state Attorney General Eliot Spitzer, who called the practice "pervasive" in the industry and suggested other music industry giants could face similar penalties.

Pay-for-play "is driving the industry, and it is wrong," Spitzer told reporters.

Sony BMG, whose various labels include hundreds of artists from Aretha Franklin and Tony Bennett to Beyonce Knowles and the Dixie Chicks, said in a statement some of its employees had engaged in "wrong and improper" practices.

The company said it looked forward to "defining a new, higher standard in radio promotion," but did not say whether it had fired or disciplined any of those employees. A spokeswoman did not return a call for further comment...

...Spitzer said Sony BMG's efforts to win more airplay took many forms, including outright bribes of cash and electronics to radio stations and paying for contest giveaways for listeners. In other cases, he said, Sony BMG used middlemen known as independent promoters to funnel cash to radio stations.

The attorney general called the system more sophisticated than the 1950s and '60s payola scandals, most of which involved direct payments of cash to DJs in exchange for airplay.

"This is a more formalized, more corporatized structure to get the same result," he said. He added, "I feel a little like Bill Murray in the movie 'Groundhog Day,'" a story about a cynical weatherman who is forced to continuously relive the worst day of his life...

Spitzer said Sony BMG's efforts to win more airplay took many forms, including outright bribes of cash and electronics to radio stations and paying for contest giveaways for listeners. In other cases, he said, Sony BMG used middlemen known as independent promoters to funnel cash to radio stations.

The attorney general called the system more sophisticated than the 1950s and '60s payola scandals, most of which involved direct payments of cash to DJs in exchange for airplay.

"This is a more formalized, more corporatized structure to get the same result," he said. He added, "I feel a little like Bill Murray in the movie 'Groundhog Day,'" a story about a cynical weatherman who is forced to continuously relive the worst day of his life.

...In the Sony BMG case, Spitzer released to reporters e-mails, most of them dated 2003, 2004 and 2005, that he said showed company executives were well aware of the payola practices.

In one case, an employee of Sony BMG's Epic label was trying to promote the group Audioslave to a station and asked: "WHAT DO I HAVE TO DO TO GET AUDIOSLAVE ON WKSS THIS WEEK?!!? Whatever you can dream up, I can make it happen."

In another case in 2004, the promotion department of Sony BMG label Epic Records paid for an extravagant trip to Miami for a Buffalo DJ and three friends in exchange for adding the Franz Ferdinand song "Take Me Out" to the DJ's station's playlist.

And in another, a program director for Clear Channel radio station WKKF-FM, or KISS-FM, sent an e-mail to a Sony executive saying: "Looking for a laptop for promotion on Bow Wow," a reference to a rapper.

Spitzer said Sony BMG employees sought to conceal some payments by using fictitious contest winners to document the transactions...