Payola

The term "payola" was coined by Variety in 1938 to refer to gifts, favors or cash surreptitiously dispensed by record companies to get orchestra   leaders and disc jockeys to play their songs. Payola -  The paying of cash or gifts in exchange for airplay.

Payola had a long history in music, predating both rock and roll and independent record companies Legislative Hearings. Perfected by the big publishing companies, payola was widely accepted as a more or less legitimate form of promotion. ASCAP protested BMI's sponsoring disc jockey publishing ventures as a refined form of payola.
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"Payola" is a contraction of the words "pay" and "Victrola" (LP record player), and entered the English language via the record business.

The use of financial and other illegal inducements went all the way back to 1880s. They were used by publishers to entice popular singers to perform their songs. It soon became part of the plugging game. Over the years some controls were instituted, but none were effective, since those expressing outrage were mist often responsible for and dependent on it.

The composer of "Tenting Tonight On the Old Campground"gave the leader of the Hutchison Singing Family a  share of the songs royalities so they would sing it at their concerts. Victorian England songwriter Arthur Sullivan gave singer Sir Charles Santley a share of the song's royalties to sing it. Later Sullivan with William Gilbert would pay large sums of money to influential performers to perform Gilbert-Sullivan compositions. This technique would become known as song plugging.

The term payola first used in 1916 by Variety in a front page editorial condemning  the practice calling it "direct payment evil."

Al Jolson was persuaded to record some songs only after was given royalties in the vaudeville era, a time when the MPPA fought against it, but couldn't stop it, payola.

Billboard stated payola was rampant during vaudeville of the 20s, and the big band era of the 1930s and 1940s.

"The cancer of payola cannot be pinned on rock and roll."
Billboard Magazine.

In at least two instances there was record of ASCAP"s direct involvement in payola. During the thirties Harry Richman and Paul Whiteman both received financial tribute from ASCAP to pay certain songs. in 1938, the Federal Trade Commission notified ASCAP that payola was a form of bribery and was unethical. the FCC pressured ASCAP to come out publicly against payola and advise its members to stop. ASCAP told its members to stop, but had no effect.

Payola had a long history in music, predating both rock and roll and independent record companies. Legislative Hearings. Perfected by the big publishing companies, payola was widely accepted as a more or less legitimate form of promotion. ASCAP protested BMI's sponsoring disc jockey publishing ventures as a refined form of payola.

1940s Variety and Billboard pop charts were used as a measure of successful music promotion. their  seeming objectively was laden with controls that made them tools of large publishers and record companies. They were made up of not just sales, but of subjective reports from sampling stores, radio stations and jukebox operators. Music producers used incentives ranging from discounts to bribes to entice retailers to over-report sales and plays to achieve higher chart position. Using these techniques were called vote gathering. With higher chart positions other broadcasters began playing records, consumers bought the record resulting in hits. When disc jockeys became key record companies wooed them by any means

Increased competition tempted many to resort to bribery to access the market. In 1942 Music Publisher's Contact Employees Association wanted to end this. Offered a $500 War Bond for information on anyone offering or accepting payola. When no charges were made Music Publishers Contact Employees Association president Johnny O'Connor declared payola dead, ignoring the fact that the incentive to perform greater than report. Two years later wrote stricter rules to check growth this too had little effect more charges and useless responses.

National Association of Broadcasters tried to deal with the problem by limiting the number of songs individual publishers could have performed on the air and bandleaders, singers and programmers could play. No more than fifteen per hundred performances with the remaining eighty-five  from at least seventy other publishers.  It never went into effect. In 1944 Warner Brothers threatened to sue against the sponsor of Your Hit Parade, charging the method of selecting songs was illegitimate, arbitrary and often discriminatory. Since performance increased demand for sheet music and records it was very important in breaking hits. If a  was quickly dropped cancellation of orders poured. The producers claim the selections based on popularity, determined from record and sheet music sales and network radio play. Warner's suit ended up going nowhere.

In the early 50s music industry publications warned record companies and radio stations that if they did not clean house they would face a crisis of public confidence and possible government regulation. Variety said payola was a 'Frankenstein" rampant in rhythm and blues and country music. a normal operating expense for independents, payola forced the majors to make deals with disc jockeys "to unload their merchandise." cash boc called for a moratorium and prosecution for anyone that betrayed the public trust.

A few stations took steps to restrict payola. In 1952 WMFS distributed a booklet to its employees calling payola a "monster" and promising any disk jockey who took it would be fired. Also DJs were not to mention names of record companies of the records or expressing their opinions about them: "the audience is not interested whether it is Capitol, Decca, Columbia or Victor release. It is interested in the selection and the artist."

Before Alan Freed's indictment, payola was not illegal, however, but commercial bribery was. It would be under the commercial bribery statutes that Freeed among others would be prosecuted.

The first court case involving payola was in 1960. On May 9, Alan Freed was indicted for accepting $2,500 which he claimed was a token of gratitude and did not affect airplay. He paid a small fine and was released. His career faltered and in 1965 he drank himself to death.

Efforts to eliminate payola were half-hearted and ineffective. Record companies came to accept it as a cost of doing business. many saw it as a victimless crime having having little or no impact  on consumer choice.

After  the U.S. House Oversight Oversight Committee hearings ended the committee wrote a bill making payola a federal offense, prohibited quiz frauds and set fines of up to $10,000, imprisonment for up to one year, or both for broadcasters who "willfully or repeatedly" violated the Communications Statute or FCC rules. The FTC outlawed payola as unfair competition and the IRS declared that the companies that engaged in payola had committed bribery and the payments weren't deductible as business expenses. The bill was signed into law in September.

What's the Story of the Payola Scandal?

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