Big Radio Staves Off Payola Investigation With Charitable Donation Of Air Time To Indies

According to FCC sources Clear Channel Communications Inc., CBS Radio, Entercom Communications Corp. and Citadel Broadcasting Corp. have agreed to a consent decree that includes a $12.5 million payment to settle payola allegations raised by the commission. (THR 1/11)

payola.jpgWhile it is not part of the consent decree, a separate voluntary side deal between the station groups and the American Association of Independent Music (A2IM) would also set aside 8,400 half-hour blocks of time for independent music.

Peter Gordon founder of Thirsty Ear Recordings and A2IM’s chief negotiator told The Hollywood Reporter the “agreement in principle” is a way to get independent music on the air that also avoids undue government interference.

“It’s a private relationship between the radio groups and the independent music sector,” he said. “It’s a chance for all of us to embrace each other’s’ cultures and it looks like the best way to get good stuff for people to listen to.” Along with airtime, broadcasters and the independent labels have also negotiated a set of “rules of engagement” that will guide how record company representatives and radio programmers interact. The free airtime would be granted to companies that are not owned or controlled by Sony BMG Music Entertainment, Warner Music Group, Universal Music Group and EMI Group, that do not have a market share larger than 4% to 5% and that are represented as independent through Sound Scan.

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