Slashdot Mirror
Shocked, Shocked at Payola
"It costs a record company about $250,000 just to launch a single on rock radio today. That doesn't guarantee success; it just gives the single access to the airwaves. If the song catches on and eventually crosses over to the mainstream Top-40 format, indie costs balloon to more than $1 million per song." Salon.com has a pair of articles on payola today: one on
the widening scandal
and one specifically on
a curious Clear Channel case. For context, here's
our latest payola story,
or if you want the background on why the labels hate the promoters but can't shake the habit,
my writeup from a year ago.
(If you want some beach reading on this topic, go check out
"Hit Men.")
When has the music industry not been one giant mess? Wasn't there a payola scandal in radio in the mid-50s or ealy 60s?
I'm dating myself but when I was a kid you could go into record store (yes vinyl records) and right up front see the rack of the Top 40 "45s". Even 10-year-olds could figure out that the ratings weren't exactly based on what other people thought of the songs. For instance how did a song get into the Top 40 to start with? The Top 40 rack was the only source of 45s in the store and the LP containing the songs on the 45 didn't usually make the racks until well after the "hit single" was in heavy rotation on the local radio station. So who was "voting for" or buying the 45s to get them into the Top 40 in the first place? Nobody heard the songs until the 45s appeared in the rack.
Periodically obvious poop made it into the Top 40 temporarily. Nobody and I really mean nobody listened to about a quarter of the 45s in the Top 40.
I've heard that the music industry is totally 0wned by the mob but I'm not too sure about this. If mob-0wnership is the case the situation just won't change.
Quit playing Monopoly with Bill. Switch to one of many non-Microsoft products today.
yes, but the internet is bad. the internet means piracy, which means profits go down. at least that is the 'company line'.
actually the real reason is the record companies like the CONTROL they have over radio. sure, it costs them money to pay off clear channel, but the record companies really choose who gets played by paying the big bucks -- it's a high cost of entry and they are the only ones with the money. in turn, they strangle the artists by saying "do what we want or we won't have you played. sign our contracts or we won't have you played and you'll never become anything." since (at least before the recent LoC levy on internet broadcasts) the cost barrier to the internet broadcast was very very low, they were afraid of this.
the real reason the record companies wanted the prices higher was to regain the effectual control of the medium by raising the cost of entry to a price only they could afford. either that, or they wanted it so high, that no one could afford it.
i actually really believe that the record companies are getting ready to deliver their own internet broadcasts -- and this will be at no cost to them as they do not have to pay their own copyright fees.
-rp
Statement of US Senator Russ Feingold on Market Concentration in the Radio, Concert, and Promotion Industries
"Thank you Mr. President. I rise today to voice my concerns about the concentration of ownership in the radio and concert industry and its effect on consumers, artists, local businesses, and ticket prices.
...
In 1996, prior to the passage of the Telecommunications Act, there were 5133 owners of radio stations. Today, for the Contemporary Hit Radio/Top 40 Formats, four radio station groups - Chancellor, Clear Channel, Infinity, and Capstar - control access to 63 percent of the format's 41 million listeners nationwide.
...
Many of the same corporations that own multiple radio stations in a given market wield their power through their ownership of a number of businesses related to the music industry. For example, the Clear Channel Corporation owns over 1200 radio companies, more than 700,000 billboards, various promotion companies, and venues across the United States. Also, just three years ago, in 1999, Clear Channel bought SFX productions, the nation's largest promotion company.
...
Ticket prices have gone up by nearly 50 percentage points more than consumer prices since passage of the Telecommunications Act - and that doesn't even include the facility fees, parking charges, box office charges or food and beverage increases.
...
It isn't just about who's talented, and who deserves to be played. It's about a shakedown, and that's just unacceptable, Mr. President, for the industry, for the artist, and for all of us as who listen."
Travis
A fight between the 800 pound gorillas and the public suffers.
/. geek would love this station merely for the technical expertise that Bill Goldsmith pulled off when he set this up.
You could launch a record and get it played on the radio for cheaper but it won't be on Clear Channel. Clear Channel does all kinds of evil stuff besides that, like piping in remote DJs and making you think they are local.
This sort of battle was inevitable when the FCC lifted regulations on radio ownership.
The solution for you, the public might be to try to patronize stations that are not conglomerate owned.
I DO listen to one radio station that is both terrestrial and internet streaming: 97X out of Oxford Ohio. Here's some of the NEW stuff I'm enjoying..
Elvis Costello
Hives
Cornershop
Idelwild
Girls Against Boys
The complete playlist is here
Great music that is bucking the current cock-rock trend of Linkin Park, System of a Down, Korn, etc. being offered by local Washington DC suck ass radio in the form of WHFS and it's "Most Played" list. (It's not Clear Channel, It's CBS, just as bad)
Then there's Radio Paradise.
Any
Just boycott Clear Channel. Turn it off.....
You needn't follow the flock is you refuse to be part of it.
But I feel I should have a go at putting some numbers that I was once quoted out there for /.teers to shoot down. Here goes.
The music industry in the US releases about 30,000 albums every year in total. That's about 600 a week. You can verify this figure plenty of ways - including looking on the web. Now here's where the figures start to be pulled out of someone's arse. It's been said to me by people who should know that some number way smaller than 10% of these releases actually make money. This is the missing information that people like Courtney leave out of their diatribes against those bloodsuckers in "the industry".
So when records go off like a bomb, and record companies sit there raking in the profits, don't forget that these profits go to pay for the other 90% of albums that didn't make any cash.
The record companies are not making that much in total, anyway. Their annual reports are online, so you can check this stuff too.
Basically, I'm just a bit bored with hearing the same old charges raised and accepted without any support
So on to payola. Again, this is essentially a storm in a teacup, with lots of missing information that never seems to get presented. For example, payola is the same story as in the supermarket game.
Did you know that supermarkets make more money from placing the product on their shelves than they do from taking it off their shelves (ie selling it to you and me)? Standard stuff. So it is with payola. The radios make more money playing the music than squeezing in the ads. That's how they can afford to play that "nonstop hour of music" or whatever at lunchtime!
Of course record companies, or anyone, need to pay to get their products placed! I don't know why anyone thinks it is any different! The radios are businesses, and they can play what they like, so they play what is in their shareholders interests to play.
Flame away, but I don't understand the shocked gasps that always follows this kind of "revelation", just like I don't understand how people get away with painting the record companies as ravening beasts, when a simple look at the balance sheet tells you they are out there makin' deals just like every other business since the dawn of time. If they were super-profitable, don't you think everyone would be doing it?
exec #1: Boy, who would have thought our payola efforts would have come back to haunt us like this?
exec #2: Not me! Sure miss the old days when a smaller amount of our billions bought way more influence.
exec #1: This whole consolidated radio network thing stinks. I wish we could just get rid of radio.
exec #2: But we NEED radio to keep distributing free music so people will want to buy CDs!
exec #1: I know. I just can't get around that. If only there were some other avenue for distributing our music freely so that people could listen to it and decide they want to buy it.
[silence]
exec #2: Well, the good news is that we've managed to successfully shut down Napster and some of its ilk. At least we'll have more money from those sales we would have lost to make the payola!
exec #1: Maybe we could sue Clear Channel, or lobby congress for a new law that would favor us! You're brilliant, #2!
Libertarianism is rich wolves and poor sheep playing gambler's ruin for dinner.
well if the proof is in the pudding, then your guess is wrong. One of the huge downsides of payola from a listeners standpoing is the lack of choice and diversity.
The choice and diversity on XM is amazing, and in fact they have one channel "Unsigned" that is specifically for bands that aren't with major labels. All bands have to do is mail in a CD, and there's a good chance that if it doesn't suck, it'll get played. I listen to that channel all the time, and it's amazing the quality of the bands and music on there... I've ordered several CDs from bands websites based on things I've heard there. (as an aside, the channel is run by Pat Dinizio formerly of Smithereens fame)
I don't know about all of the channels, especially the ones that play more "Top 40" oriented music, and how they determine their playlists, but I do know that the choice is remarkable.
I agree that there is the potential down the road for these services, should they displace traditional radio, to have a duopoly (or monopoly should they merge or one die) and that could be very bad, but at this point I think Satellite Radio is the cure for payola, not another problem.
No man is an island, but Gary is a city in Indiana.
The general sentiment regarding FM radio these days seems to be: it sucks.
With radio stations having to pay an increasingly large fee for each song on the playlist, it's no wonder that they play a much smaller selection of songs than they used to (say, back in the 80s).
Clear Channel claims (paraphrasing) "We're just playing what people want to hear". However, there are several really interesting side-results of these shrinking playlists.
First, we have to lay down some facts. The first is that fewer people are listening to the radio, period. The second is that for those who do listen to the radio, they are listening for shorter and shorter periods.
Now let's assume you're a casual radio listener as most people are. What kinds of songs are you going to request most? Probably the ones you've been hearing recently that you like. No diversity in songplay equals everybody requesting the same thing, and everybody requesting the same thing means radio stations play the same crap over and over again (which is fine by them, since they don't have to pay out extra cash for more songs on their playlist). In a sense, it's cyclic: people request what they know, and stations play what they request.
From one perspective, Clear Channel is correct when they say they are playing what people want to hear. But that's taking a small picture view, because when taken in a larger context the statistics really are supporting the fact that people don't want to hear the radio at all! Ask any radio listener what the biggest problem with radio today and he'll tell you lack of variety. Thus, the sucking. And the more sucking there is, the fewer people will listen.
Here's another interesting thing that I haven't seen discussed: How this affects CD sales. Let's consider 2 scenarios. In scenario A, the radio station is playing 60 tunes in regular rotation and a few classics, and replace songs in rotation at the rate of 10 per week. In scenario B, the radio station is playing 30 tunes in regular rotation, plus a few classics and replace songs in the rotation at the rate of 2 per week. Which station is going to generate more CD sales?
Let's assume (for the sake of simplicity) that each station has exactly 1000 listeners. Each listener has a 1/10 chance of liking a song enough to buy a CD. Each listener is also going to listen for 120 songs in week 1, and 120 songs in week 2.
The people listening to station B hear each song 4 times during each week. They are exposed to 32 songs (30 from week 1, plus the extra 2 rotated in during week 2), and buy an average of 3.2 CDs due to this. 3.2 * 1000 = 3200 CDs sold.
The people listening to station A hear each song twice during each week. They are exposed to 70 songs, and buy an average of 7 CDs due to this. 7 * 1000 = 7000 CDs sold.
This, of course, is a very simplified case, as it doesn't take into account disposable income, but neither does it take into account song burnout (when you like a song but are so sick of it you never want to hear it again), but I think it makes it's point. Oh, and in case you didn't get it, radio stations today are like station B.
As a result the music labels complain that people aren't buying music and point their fingers at Napster, I don't buy it as the sole reason. I point my finger at station B and say "people are listening to the radio less than ever and being exposed to less music than ever. What did you expect!?"