If a recent announcement by the nation's largest radio broadcaster is any indication of a trend, independent music promoters may be on their way to extinction.On April 8, Clear Channel Communications announced that it would not renew deals with "indies," as independent music promoters are known in the business, when current agreements expire this coming summer. Should other broadcasters follow suit, by this time next year the music industry's relationship with radio could be permanently altered. San Antonio–based Clear Channel has approximately 1200 stations.The independent promoter system arose out of the "payola" scandals of the 1950s and 1960s, when record labels made direct payments to disc jockeys to play new recordings. The use of indies created the appearance of a wall between the labels and radio stations. Independent promoters make suggestions regarding additions to radio stations' playlists, and provide the stations with "support payments." The promoters, in turn, are paid by record labels based on the number of "spins" new releases get on the air. Promoters also seek exclusive relationships with program directors in order to have more influence over what gets played.
The practice has been attacked by musicians who say they can't break through a closed system, and by music fans bored with commercial radio's narrow, predictable playlists. Commercial radio long ago ceased to be a good source for discovering new music. College radio stations, cable TV's DMX service, and the Internet are much richer resources. The independent promoter system is also under scrutiny by members of Congress, who suspect that the appearance of propriety hides illegal agreements. Payola still exists, but because the money changes hands twice instead of once, it isn't specifically illegal. Furthermore, if stations do accept payment for airplay, they are required to announce it. Payments from indies vary from about $20,000 a year to a station in a small market to as much as $300,000 a year for a dominant station in a major market.Insisting that Clear Channel has never been influenced by independent promoters, despite accepting payments from them, company president Mark Mays said, "We don't want to have the appearance . . . that the independent-promotion system is a payola system or a pay-for-play system. We want to make sure there's not even a tinge of perception that there's pay for play." Mays claimed that Clear Channel, which last year enjoyed $8.42 billion in revenue and $725 million in net income, has derived less than 0.2% of its revenue from independent promoters, and that letting contracts with them lapse wouldn't affect the company's bottom line. Henceforth, employees in Clear Channel's programming departments will be required to sign affidavits disavowing all involvement with payola or its legal equivalent, he stated.
