July 28, 2005
Payola or No, Edge Still to the Big
By JEFF LEEDS
NY Times
http://www.nytimes.com/2005/07/28/arts/music/28musi.html?pagewanted=print
"Listen to Your Heart," performed by the Belgian duo D.H.T., ranks as the
No. 5 song on the nation's pop music stations this week, a potentially
lucrative achievement for Robbins Entertainment, the independent music
label that released the recording.
But Cory Robbins, the president of the nine-year-old label, says there is a
basic reason why "Listen" - a cover of a 1980's ballad by the Swedish band
Roxette - is one of only two songs by independent music companies on
radio's Top 40. The reason: independent labels lack the deep pockets and
personnel of the major record companies.
"They're always going to have a bigger army," Mr. Robbins said. "That is
going to help them win most of the time."
The big labels' edge is not expected to dull - even as Eliot Spitzer, the
New York State attorney general, spearheads a vigorous campaign to expose
payola, in which record companies provide gifts and other enticements to
radio personnel in exchange for airplay. This week, Mr. Spitzer announced
that he had settled payola allegations with the music giant Sony BMG Music
Entertainment, a partnership of the Japanese electronics maker Sony and the
German media conglomerate Bertelsmann. The company, whose roster includes
Jennifer Lopez and Britney Spears, agreed to pay a $10 million fine and to
adopt tighter rules on how it promotes its music to radio. Other record
companies have also reviewed, and in some cases tightened, their promotion
policies after receiving subpoenas from Mr. Spitzer in his continuing
investigation.
The settlement has reverberated widely. The program director of WRHT in
Greenville, N.C., who was cited by Mr. Spitzer as having improperly
received a $1,365 laptop computer, $912 in airfare and Playstation 2
equipment from a Sony BMG label, was fired at the end of his shift Tuesday,
said Gordon Herzog, chief financial officer for WRHT's parent, Archway
Broadcasting.
But in the end, even within the tighter restrictions, the major labels
simply have more money and manpower to wheedle programmers into adding
their music to broadcast play lists. The big players, far more so than
their independent rivals, also have the wherewithal to build demand for
their acts by subsidizing their tours and record-store advertising,
producing music videos and landing them on television shows.
This imbalance in resources accounts, in part, for the disparity between
sales and airplay in the music business.
The independent sector, which includes hundreds of labels that may
specialize in genres from polka music to speed metal, and that sell music
directly or through one of the bigger companies' distribution arms,
accounted for an estimated 18 percent of new album sales in the United
States so far this year, according to Nielsen SoundScan. Their combined
share of the industry, as measured by these sales, is larger than that of
two of the four big companies, Warner Music Group and EMI Group. The
independents, however, command a far smaller share of the limited slots on
play lists in major radio formats, as the Top 40 chart illustrates.
In addition, music executives say, even without reforms, radio programmers
are likely to rely heavily on listener research (usually built around
telephone polling, a method many label executives believe is flawed) in
determining their play lists. Mr. Robbins said his song would not have
risen to its current heights if the radio stations playing it - including
Z100 in New York - did not receive positive feedback from research or
call-in requests.
All of that is not to say that Sony BMG's settlement - and similar
agreements with other major labels that are likely to follow - won't alter
the relationship between record labels and radio stations. If nothing else,
the attorney general's inquiry has prompted many a radio programmer to pick
up his or her own tabs at dinner, and has label promotion executives
avoiding using e-mail. (The settlement documents included a blizzard of
e-mail messages in which executives communicated openly about paying radio
stations for airplay and distorting the airplay charts through tactics like
false call-in requests.)
New rules governing how labels can try to influence programmers are
expected to effect some changes in the day-to-day world of promotion. In
the post-Spitzer climate, for example, a label might no longer underwrite
the production costs of a radio station-sponsored concert, or prop up a
weak-selling show by buying dozens of extra tickets.
How might a small label compete in the new climate? Perhaps by employing
some of the same tactics that Mr. Spitzer has criticized. In the case of
Robbins Entertainment's "Listen," for instance, the label has provided
reinforcements for its sole executive for lobbying radio by hiring
independent record promoters, that is, middlemen who are paid by the
company to pitch songs to programmers around the country.
In many cases, these promoters pay radio stations annual fees that they say
are not tied to airplay of specific songs, but then bill their record label
clients each time a station adds their song to its play list.
Mr. Spitzer said this practice is used "to perpetuate the fiction" that
stations are not receiving money or promotional items in exchange for
airplay. In other cases, the promoters are paid flat retainer fees.
Mr. Robbins - who estimated that he spent less than $100,000 on such
promoters so far on "Listen" - said these middlemen, also called "indies,"
"are good for small labels. Every now and again we have a record that can
cross over to the pop chart, and that's when we need indies. If someone can
get me a station I need and I can pay $1,000, great."
The fees, he said, are considerably more affordable than paying a full
staff of executives placed around the country 52 weeks a year.
He added that some measures taken by the radio industry to avoid even the
appearance of corruption may actually have hurt listeners' chances to hear
more diverse music. For example, Clear Channel Communications, the nation's
biggest broadcaster and the dominant company in the pop format, announced
in 2003 that it would sever its ties to independent promoters. As a result,
tiny record labels with few employees must make their pitches to individual
programmers in its far-flung roster of stations one at a time and - with
relatively few releases a year - have trouble developing relationships with
programmers.
While a major label may send executives to visit programmers each week, "we
can't do that," Mr. Robbins said. "We can mail our records and call them
and hope they listen."
================================
George Antunes, Political Science Dept
University of Houston; Houston, TX 77204
Voice: 713-743-3923 Fax: 713-743-3927
antunes at uh dot edu
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