Radio’s impact on music industry profits—radio airplay can help to popularize recordings—has required ongoing government oversight to expose illegal playlist manipulation. Payola, the practice by which record promoters pay deejays to play particular records, was rampant during the 1950s as record companies sought to guarantee record sales (see Chapter 4). In response, management took control of programming, arguing that if individual deejays had less impact on which records would be played, the deejays would be less susceptible to bribery.

Despite congressional hearings and new regulations, payola persisted. Record promoters showered their favors on a few influential, high-profile deejays, whose backing could make or break a record nationally, or on key program managers in charge of Top 40 formats in large urban markets. Although a 1984 congressional hearing determined that there was “no credible evidence” of payola, NBC News broke a story in 1986 about independent promoters who had alleged ties to organized crime. A subsequent investigation led major recording companies to break most of their ties with independent promoters. Prominent record labels had been paying such promoters up to $80 million per year to help records become hits.

Recently, there has been increased enforcement of payola laws. In 2005, two major labels—Sony-BMG and Warner Music—paid $10 million and $5 million, respectively, to settle payola cases in New York State, where label executives were discovered bribing radio station programmers to play particular songs. A year later in New York State, Universal Music Group paid $12 million to settle payola charges, which included allegations of bribing radio program directors with baseball tickets, hotel rooms, and laptop computers. And in 2007, four of the largest broadcasting companies—CBS Radio, Clear Channel, Citadel, and Entercom—agreed to pay $12.5 million to settle an FCC payola investigation. The companies also agreed to an unprecedented “independent music content commitment,” which required them to provide 8,400 half-hour blocks of airtime to play music from independent record labels over three years.