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Payola, Only Different

by Disenchanted


NOTICE: TO ALL CONCERNED Certain text files and messages contained on this site deal with activities and devices which would be in violation of various Federal, State, and local laws if actually carried out or constructed. The webmasters of this site do not advocate the breaking of any law. Our text files and message bases are for informational purposes only. We recommend that you contact your local law enforcement officials before undertaking any project based upon any information obtained from this or any other web site. We do not guarantee that any of the information contained on this system is correct, workable, or factual. We are not responsible for, nor do we assume any liability for, damages resulting from the use of any information on this site.

2002-8-20

http://www.disenchanted.com

Tucked in a corner on the mezzanine level of the University Union on the campus of Binghamton University in New York are a couple of rooms where the walls are plastered with ageing posters and graffiti, the tile ceilings studded with pens and forks and gummi bears, a couple of beat-up sleeper-couches adorn the lobby, and an array of audio and broadcasting equipment sit with their knobs and dials worn smooth over time by fingers tainted with pizza grease. It's the old home of WHRW 90.5 FM. It has real turntables, real reel-to-reel tape decks, real cart players, and two real vinyl record libraries with real vinyl records that are stacked up as high as the little window that offers a view of the library tower and the antenna perched atop it.

It's one of those places where the DJ has to push a buzzer button under the mixing board to unlock the library doors, and then race through the corridor to let himself in before the timer locks him out or the current song comes to an end. It's a de-facto meet-and-hang-out place for DJs and their friends, who'll help to choose and pull records for the show, then file them again in the musty smelling racks. WHRW has no format, it airs no commercials, the DJs play what they want, when they want it, and even bring in some of their own disks from home; such as Peter Post and his extensive collection of oldies, or the legendary Dannie Jan and his unabridged universe of Polka. But don't get me wrong, this is a frequency where you'll also hear pop, rock, latin, techno, new-age, punk, metal, alternative, classical, jazz, reggae, electronica, rap, gospel, news, talk, and Mad Trivia. WHRW has its own ghosts, its own community, its own tragedies, a history of students locking themselves inside to stage a political protest, and original station IDs by megalegends such as John Lennon and Weird Al Yankovic. It has all that and a faint aroma of ganjaD, too.

WHRW is also one of the last real radio stations left in the country.

In a modern commerical radio station you won't find any of this equipment or stock, but you will find a computer console instead. The songs are all represented by icons in a playlist folder, and the DJ drag-n-drops them across the computer screen onto icons that represent CD players if the songs are on disk, or digital file players if they've been stored on hard drives. It's also likely that the DJ isn't even live in the booth as the songs are broadcast, since many will now tape all their intros and outros in the morning for a show that's broadcast later in the day by satellite to regional stations all over the country. If you've ever closed your eyes while listening to the radio and imagined, just before a song started, that there was this guy who reached out and placed a stylus on a record, know that it was the flick of a mouse instead. And if you've ever imagined that the Top 40 countdown is being read live, moments after a courier ran into the station lobby with a sealed envelope, know that the DJ is probably already at home ordering pizza, and the songs were chosen by the record company weeks in advance.

The de-romancing of the radio industry is part-and-parcel of a move that began 50 years ago when, according to legend, a station owner named Todd Storz was in a tavern taking notes on which songs were played the most often on the Juke Box. When he put the top ten into heavy rotation at his station, his ratings bubbled up from dead last to dead first, and the idea spread as other station owners came to have a listen and take the idea back with them. Fifty years later the formula has changed, but the kind of music you get to hear is still the same. What changed was the addition of direct record company influence in the form of “legal” payola, and all the dehumanization on top of that has been the fault of cost-cutting: it's simply cheaper to run 500 radio stations from a single studio in California.

The payola system in use today is elaborate, but effectively gives a record company direct control over a station's playlist. The record companies pay independent record promoters (“indies”) to get a song added to a playlist, and the agent uses some of that money to pay a radio station to have that song inserted by the program director. It can add up to about $1,000 a song, or over $100,000 a year for some stations, which will cover DJ salaries and maybe still have enough left over to buy a new van to toodle around town with. It's called “promotion” and the stations are reluctant to reveal what the money is used for, but it's payola alright, only different.

Here's a good trick question to ask at a party: how far up the charts did Led Zepplin's Stairway to Heaven get to? The answer is that it didn't: Stairway was never released as a single, but gained massive popularity because a DJ liked it and decided to play it on air. But try holding out for that kind of minor miracle today and you'll wait a long time, because today's DJ doesn't even touch the physical media the song comes on—it's in a locked room that he doesn't have access to—and the station would never add a song to the list unless there was an opportunity to collect some payola at the same time. In short, unless you have some untainted stations somewhere on your hometown's dial, you're never going to hear something that a record company hasn't already paid up to $200,000 or more to get put on the nation's playlists.

Left outside of the system are thousands of new songs and artists every year who haven't proven they can produce the kind of sales that would justify such a high price tag to get airtime, and so music like this is confined to stations like WHRW, where the only F-word considered obscene is “Format”. But bastion of free airwaves it may be, stations like “The Mighty H” are usually operated on a non-commercial license by universities, a license that limits the frequences a station can use and, in practice, the power they can transmit with. WHRW has only a 2-kilowatt transmitter to avoid drowning out another station in a nearby town. To put that into perspective, KNBC, the largest station on the west coast, broadcasts from a 50 kilowatt transmitter. It's the difference between a signal that breaks up on your car radio fifteen or twenty miles from the antenna, and one that blankets almost an entire state.

(The above paragraph was corrected on 2002-8-25. It used to say non-commercial licenses restricted the transmitter power, but this isn't true. Non-commercial licenses restrict stations to lower frequencies and disallow commercial advertising.)

No wonder people say radio sucks. The presense of independent radio stations is fantastic for the regions that have them, but if underrepresented artists get the feeling they're being drowned out by a whitewash of bland radio fare, it's because they are. Unable to rely on a talent scout to “discover” them, these disenfranchised artists are grateful for whatever spin-time they can get.

But if you've been squeezed out of the traditional distribution channels, then why not roll your own? This is more or less what happened because of the Internet and the ability to stream high-quality audio over it in near real-time (live). It's cheap, easy to get started, and there are several companies that will take over the job of rebroadcasting your programming across faster Internet lines (they're called “reflectors”). Who stepped up to take advantage of this new medium were mostly kids and music enthusiasts with Cable Modem or DSL service, who could transmit a signal to a reflector and have a potentially unlimited audience. They brought “real” radio back, but ironically their control rooms look more like a commercial FM station than WHRW's: a computer with lots of hard drive space and some software for putting together a playlist. Ah well, a small price to pay for musical freedom.

Internet radio has some economic limits that FM dosn't, though. To listen to a station you need a computer and fast Internet connection of your own, which isn't a very portable solution and it certainly can't fit in your car. The other problem is that the station needs to transmit the same signal once for each listener, because that's currently the only way to deliver the music. If you have ten people listening to a 128 kilobit transmission (FM quality sound), you need to pay for an Internet account that can send data at 1,280 kilobits per second. Whether that's you or the reflector service, it means your costs go up as your audience size does. This isn't so with FM radio, where the cost to broadcast isn't related to the number of listeners: you could have a potentially unlimited audience if they're willing to squeeze inside your signal radius.

This meant that even the commercial Internet radio stations make very little profit, and all the amateur ones are funded entirely out-of-pocket, so any extra costs put on top of that would kill off most of the unprofitable and amateur stations.

Like, say, the royalty payments imposed on such stations last Spring by the Copyright Arbitration Royalty Panel (CARP), as part of a pay-per-song system mandated by the Digital Millenium Copyright Act (DMCA) of 1998.

Internet radio stations, or “Webcasters” as they're now called, must pay a fee of 0.07 cents per listener per song, which sounds like peanuts until you consider that reflector services such as Live365 log about 8.4 million listener hours per month. Live365 now needs to find another $200,000 per month to pay the agency who'll be collecting those royalties—the RIAA. Plus, since the dues are retroactive to the passage of the DMCA, they also need to find another $1.5 million to cover the songs they've broadcast in the past.

Those stations who couldn't pay bit the dust. Many amateur Disk Jockeys even had to declare personal bankruptcy to avoid paying the huge fees they now rectroactively owed. What was once a bright hope for both DJs and musicians alike is under grave threat. The costs of allocating Internet bandwidth were coming down, giving many stations a chance to grow, but the DMCA has made costs bounce back through the roof again, and many stations may be forced to accept payola (or “promotion”) just to keep themselves lit. With payola comes record-company controlled playlists, and with playlists comes blandness, just like modern commercial FM radio.

Maybe the answer to all this is if the musicians themselves supplied the payola. At 0.07 cents per listener per song, you can buy exposure to 7142 listeners for a five-spot—a lot less than the $1,000 per-station it can cost in the FM business. And best of all, with the microbilling techniques perfected by Google, it doesn't even have to impair the integrity of the DJ.

When you buy advertising space on Google you put some cash in your account and tell them what keywords you want your ad to appear on. Your account doesn't get debited unless someone types in that keyword and sees the ad, and you're never forced to pay more than you budget. Google is getting paid whenever they deliver search results with advertising on the side, but they don't have to force a particular set of search results on you. Every now and then Google serves up a list of results that don't match a keyword bought by an advertiser, and they take a minor loss.

The same can be set up for artists and DJs. The artist puts money in an account along with the names of all the songs they'd like to have spun. The account doesn't get debited unless a DJ actually spins it, and the DJ isn't influenced because he has thousands to chose from. Every now and then a DJ may chose to play a song he likes that isn't covered by any payola, and for the legions of amateurs with audiences rarely exceeding 200 simultaneous listeners, that could be pocket change.

A system like this will put a natural bias on new songs, but because the barriers to entry are lower, a wider range of music from underrepresented artists will be available. And there's another side-effect: it will give artists the ability to do their own accounting, so they can go to the RIAA and demand their share of the royalties, which they can put back into the payola system. The chance of beating up the selfish trade group that imposed this royalty mess may even attract more musicians to do the same, balancing out the variety of music that DJs can spin for free.

We might call this new system “promotion” for the sake of making it look clean.

But it's payola alright, only different.

 
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