“Universal” soldier: Spitzer nails UMG, takes aim at EMI

The world’s largest music company has been fined $12 million for its part in the seemingly unending payola hunt headed by New York State Attorney General, Eliot Spitzer. SpitzeBig.jpg

Per the Wall Street Journal,

“Mr. Spitzer’s office produced emails and other documentation that showed Universal executives agreeing to give radio programmers computers, travel, concert tickets and other inducements in exchange for specific amounts of airplay for specific songs. That practice is illegal under decades-old laws against payola. Although other behavior that was detailed, such as buying ad time and using it to play songs, are less clearly violations of the law, Universal nonetheless agreed to discontinue such practices.”

In other words, Universal is stopping pay-for-play (bribery) and paid for play (buying ad-time and using it to play music.)

We’re against bribery in all forms – at least until an envelope stuffed thick with cash arrives here at the ‘bowl, anyways. But we also wonder: When we read The New Yorker or the New York Times Magazine, we’ll occassionally read an advertorial. Should these publications be fined for selling space to advertisers who want to show us their product in greater detail? Where does it stop?

I mean, had Universal disclosed on-air that it was sponsoring the playing of a song, would that have made it ok?

We want to beleive that Spitzer’s settlements are going to fundamentally change radio for the better, but they just aren’t. We’re not foamy-mouthed libertarians, either, but there is an argument to be made that radio -ready music is ultimately about music as product – a disc or download to be purchased – as oppossed to an experience that you go and have.

The Grateful Dead proved this, as have Phish and Widespread Panic – they’ve given their music away for free, and yet their ticket sales have taken care of them to the tune of millions. But they’re the exception. Part of the problem is that record companies are just that: Record companies. They’re in the business of selling records. We say: Let’ em.
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In this day and age, the real issue isn’t distribution monopoly. The internet of MySpace and YouTube and iTunes et al has changed all that. For new band, the thorniest issue is performance monopoly: You want to know who the Devil really is? Try Ticketmaster and Clear Channel, which together conspire to keep the same bands in the same venues year after year – to the exclusion of any new music acts breaking out organically.

While it is impressive for Spitzer to rack up skins (EMI will likely settle in the next month) far more impressive would be for the New York AG to focus his considerable talents and energies on the anti-competitive practices of the concert business.

As Business Week put it five years ago:

“…having amassed its Texas-size empire with relatively little regulatory scrutiny, questions are being raised about the company’s leverage and reach. One group in particular is crying foul: regional concert promoters. In recent months, these promoters, who rely on radio airplay and touring to break new acts and strengthen established ones, have been accusing Clear Channel of anticompetitive practices. They say it uses its radio influence to boost its concert business by withholding radio play from artists who aren’t booked on Clear Channel tours–thus squeezing small promoters out of business.”

Um, Hell-o?

As Led Zepplin once said, “the song remains the same.”