Senator Russ Feingold (D-Wis.) Friday introduced a bill that would increase the penalties for payola, the practice of paying to influence the playing of certain songs, including putting a radio station's license at risk for violating FCC rules prohibiting the practice.
The bill would require "arm's-length transactions between radio stations and record companies that might want to influence playlists, and would require the station's to keep records of those transactions handy for FCC inspection.
"As we have seen in the realm of indecency, multimillion dollar companies do not blink at the current fines of $10,000 per violation," said Feingold in unveiling the bill, "but the prospect of putting a license in jeopardy will get their attention."
The bill broadens the definition of payola beyond the "direct bribing of DJs and stations" to relationships with independent music promoters. "No matter what tortured path money or other consideration travels," Feingold said, "if it is for airplay and not disclosed, it is payola."
And in a direct shot at Clear Channel, the bill would put restrictions on the cross-ownership of radio stations and concert venues. Clear Channel is a dominant player in both.
New York Attorney General Eliot Spitzer earlier this year turned over information to the FCC after settling with music company BMG over the issue of radio stations paying for play. That investigation included up to a half-dozen Clear Channel employees.
FCC Chairman Kevin Martin opened an investigation into payola as well, saying he would widen it if necessary.
Feingold wants to give the FCC more clout in dealing with any violations it may find, as well as build disincentives into the regulatory framework.
The bill would require stations to disclose all payments or considerations and their sources, along with a monthly playlist, including label and artist. "While corporations may not fear the current hard-to-prove $10,000 fines," he said, "they do understand public relations. The potential for consumers and the media to use these records to connect the dots should have a chilling effect on the practice and may mean that the FCC Enforcement Bureau will rarely even need to be involved."
The American Federation of Radio and Television Artists praised the bill. In a statement released Friday, it said the legislation "will shine a light on the insidious practice of payola, which has continued to suppress employment opportunities and income for AFTRA recording artists."