No Payola 'Train Wreck,' Says Mays

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Clear Channel President and CEO Mark Mays said Monday he did not see a "train wreck" coming on the issue of payola.

In addition, Mays says that since, as a political reality, he doesn't see the government treating pay and free radio equally in terms of indecency, free broadcasters should get some other kind of competitive leveler, like the ability to own more stations. (Clear Channel already owns 1,200-plus).

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, saying he would widen it if necessary.

During a Progress and Freedom Foundation panel session in Washington Monday, Mays said that programming employees are required to acknowledge that they understand that payola is illegal, and that the 4-6 employees investigated in connection with the BMG consent decree were the bad actors, leaving 99.9% of its radio programmers doing what they should be doing.

On the issue of indecency, Legg Mason analyst Blair Levin asked Mays whether he favored putting indecency guidelines on all platforms, paid or free. He said yes, but didn't think that was going to happen. And since pay was going to be allowed to air uncensored Howard Stern, and free would not, he argued there should be other ways to level the playing field.

"I think that in the world of politics, there is going to be a differentiation [on indecency]," he said. "And so we need to have other mechanisms that allow us to compete effectively." That other mechanism was the focus of his prepared remarks: Loosening media ownership rules for broadcasters. Mays said he can only own 8 stations in a market, while XM can deliver 150.

Either deregulate us or regulate satellite radio more, said Mays, including public interest obligations. Mays proposes owning 10 stations in markets with at least 60 radios, and 12 in markets with at least 75. But he said that even with 24 stations, compression would allow his satellite competition to have three or four hundred.

Still, Mays suggested deregulating him, rather than regulating the competition, is the better route.
"We would love to be unshackled from all kinds of regulations," he said, "including public interest, but that is not necessarily good for the American public."

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