Payola Flashcards
Payola
commercial bribery in the radio industry
Four big payola scandals dates
- 1959
- 1974
- 1986
- 2004
What was the main reason for the 1959 payola scandal?
industrial concerns with the rise of rock n roll in 1955
industrial concerns (1959)
show tune industries didn’t want to be displaced by rock n roll
*1959 two main sides of the camp
- Tin Pan Alley: old school music publishers who were associated with show tunes
- New local radio model, which was associated with rise of genre music
Describe Tin Pan Allley control before local radio and how this changed with local radio.
Under network radio, they could place songs in musicals and network radio shows. With rise of local radio, this changed and stations began playing genre music
What was used for bribery in the 1959 payola scandal
equity stakes, specifically intellectual property rights
What was the flow of resources like in the 1959 scandal?
Record labels would ofter disc jockies something of value in exchange for airplay, often royalties
What was used for bribery in the 1974 scandal?
drugs
What was the main reason for the 1974 scandal?
Columbia records became interested in soul music but didn’t know how to promote it, so they resorted to drugola.
Drugola
record companies would give cocaine and cash to tip sheet publishers (which were people who wrote newsletters to djs saying these songs would be big)
*Explain the 1974 scandal
Columbia records was bribing tip sheet publishers to include soul music in their newsletters, as well as bribe radio staff for airplay.
Drug smugglers would send bills to David Wynshaw at Columbia Records for “delivering records.” Wynshaw knowingly signed these false invoices
Briefly explain the 1986 payola scandal
independent radio promoters known as “the network” were controlled by the mob
record labels would pay indies per add (the first time a station plays a song) – indies would give a cut of the money to the mob and they would also pay radio program directors cash and drugs for playing a song
What was used in the 2004 radio scandal?
gifts, such as concert tickets and plane tickets that the radio could giveaway to listeners
was a more sophisticated and professional way of bribery
What was the business model for artists after the 2004 scandal?
Artists were typically given an advance, which was enough for them to survive and record their music.
This acted as a loan that the artist owed the record label and was payable back against royalties (don’t get royalties until you’ve paid the advance back)
What were payola expenses in the 2004 scandal?
recoupable debt
What was the implication for artists in the 2004 payola scandal?
musicians were going into debt that the label spent on their behalf
Recall Sony ex. where the artist had to pay off the debt from tv gift
What is a commonality across all payola scandals?
material resources flow from the labels to the radio station and the stations reciprocate with airplay
Bidding wars
record labels bid up the value of payola to the respected value of the publicity
Rent Dissipation
when you’re seeking something of value (e..g publicity) and you spend up to the value of that rent
Explain how payola relates to prisoner’s dilemma
-paying a bribe strictly dominates
- if neither label bribes they get equal airplay and it costs nothing, if one bribes and the other doesn’t the one who doesn’t bribe is better off, if both bribe they pay more for equal airplay (which they could’ve achieved without bribes)
-this dilemma is also known as a monopolistic cartel
Explain how payola existed before radio
-Payola-like practices existed with sheet music during vaudeville
-song pluggers would go to musicians and offer pay if it was included in the show
Key Theme of Payola
when publicity is a resoure, people, try to co-opt that resource
-what consitutues as publicity and how they charge will vary over time
