Music Business Worldwide write………..FCC Commissioner Michael O’Rielly has written to Sony Music Entertainment, Warner Music Group and Universal Music Group in the United States to request information from the companies about their current payola-prevention ‘mechanisms’, in addition to their ‘understanding of the current payola rules’.
In the letter, dated January 16, and released yesterday (January 21), O’Rielly explains that he reached out to recorded music trade body RIAA last year “to inquire into recent reports of practices potentially in violation of federal anti-payola laws and regulations”.
The RIAA, says the letter, “claimed that it was not in a position to survey its members’ anti-payola practices and submit responses collectively”.
The RIAA subsequently suggested that O’Rielly and the FCC contact the majors directly, which he has now done, via this letter.
“THERE IS NO SHORTAGE OF ACCUSATIONS THAT FINANCIAL ENTICEMENT IS IN SOME CASES DRIVING CHART RANKINGS, ALBUM AND SONG SALES, AND COMMERCIAL SUCCESS.”
MICHAEL O’RIELLY, FCC
“Even the most cursory review of consumer complaints and assertions provides cause for concern regarding the persistence of payola,” writes O’Rielly.
“And, in recent months, some artists have responded forcefully against accusations of payola, which speaks to the seriousness of the issue.
“Yet, there is no shortage of accusations that financial enticement is in some cases driving chart rankings, album and song sales, and commercial success.
The letter – addressed to SME’s Senior Vice President, Deputy General Counsel, Wade Leak; UMG’s Head Of Global Compliance Saheli Datta, and WMG’s Senior Vice President, Deputy General Counsel & Chief Compliance Officer Trent Tappe – ends with six questions (see below), which O’Rielly and the FCC ‘respectfully request’ are answered by the end of February.
“AS PROPOSALS ARE CONSIDERED TO UPDATE LAWS AND REGULATIONS TO KEEP PACE WITH THE CURRENT MARKETPLACE, UNDERSTANDING CURRENT PRACTICES REGARDING ANTI-PAYOLA COMPLIANCE IS CRUCIAL FOR LAWMAKERS AND REGULATORS.”
O’Rielly suggests that current payola restrictions could have an effect on the long-term sustainability of the US radio industry.
He notes that even though traditional radio and streaming services are competing for the same listeners, the “radio industry finds itself subject to payola restrictions when alternative technologies, such as streaming, Internet radio, podcasts and other commercial audio distribution platforms, do not”.
Adds O’Rielly: “Moreover, as the lines between these different technologies are becoming more blurred each day, the compliance difficulties facing dynamic radio companies that deliver content via multiple distribution methods and those that interact with them increase as well.
“As proposals are considered to update laws and regulations to keep pace with the current marketplace, understanding current practices regarding anti-payola compliance is crucial for lawmakers and regulators.”
Read the full report at https://www.musicbusinessworldwide.com/could-an-overhaul-of-payola-rules-be-on-the-horizon-majors-asked-to-explain-anti-payola-practices-to-fcc/