Evidence of violations will bring 'swift action.'
Under pressure to act upon payola allegations uncovered in the wake of Sony BMG Music Entertainment’s settlement with New York state Attorney General Eliot Spitzer, Federal Communications Commission chairman Kevin Martin has directed the commission’s Enforcement Bureau to review the settlement and “investigate any incidents in which the agreement discloses evidence of payola rule violations.”
In a statement released late Monday (August 8), Martin pledged “swift action” should the Bureau determine violations of federal rules occurred. Any evidence beyond the Sony BMG settlement presented to the commission will also be acted on, Martin said.
EMI Group, Warner Music Group, Clear Channel Radio and Cox Radio have disclosed receiving subpoenas in the industry-wide investigation. Universal Music Group, Infinity Broadcasting and Entercom have reportedly been served as well. Future settlements with Warner, Universal and EMI may be modeled after the Sony BMG settlement.
Known for playing his cards close to the vest, Martin has kept relatively quiet on the subject in the two weeks since Spitzer made headlines with the $10 million settlement. Through his spokesman, Martin had only indicated that the commission intended to take "a close look at the material.”
But commissioner Jonathan Adelstein had likened Spitzer’s evidence to "an arsenal of smoking guns,” calling for the commission to use it to ramp up federal payola enforcement.
Martin’s initial reluctance to call for a full-on investigation led some to speculate that he would wait for President Bush to fill two Republican openings on the five-member commission before acting.
Now Martin says he is “very concerned” about the music promotion activities that triggered Spitzer’s 11-month investigation. “The FCC has longstanding rules prohibiting payola,” Martin said. “Broadcasters must comply with these rules. The Commission will not tolerate non-compliance.”
Acknowledging that payola may not be widespread, “to the extent it is going on, it must stop,” Martin’s statement continued.
Adelstein immediately applauded the statement. In a strongly worded statement of his own, Adelstein said, "this payola scandal may represent the most widespread and flagrant violation of any FCC rules in the history of American broadcasting . . . The airwaves belong to the public, not the highest bidder. The vitality of radio is sapped when music is selected based on bribes rather than merit."