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Radio Promotion - Payola
January 08, 2003

By Bryan Farrish

Payola - Legal Definitions

Now let's cover what payola actually is and isn't. First of all, there
is no such thing as "legal payola", just like there is no such thing
as "legal theft". An activity is either illegal payola, or it is legal.
The grand rule that governs the whole thing is section 317 in the
Code of Federal Regulations...

40 FCC 317 reads: "All matter broadcast by any radio station for
which any money, service or other valuable consideration is
directly or indirectly paid, or promised to or charged or accepted
by, the station so broadcasting, from any person, shall, at the time
the same is so broadcast, be announced as paid for or furnished,
as the case may be, by such person: PROVIDED, that the
'service or other valuable consideration' shall NOT include any
service or property furnished without charge or at a nominal
charge FOR USE ON, or in connection with, a broadcast unless
it is so furnished in consideration for an identification in a
broadcast of any person, product, service, trademark, or brand
name beyond an identification which is reasonably related to the
use of such service or property on the broadcast." (emphasis

What this says is that if something of value (say, $500 cash, or a
DVD player, or 100 CDs) is given to a station with the
UNDERSTANDING that a particular song must be played in
order for the station to get the valuables, then this fact must be
announced to the listeners. If the announcement is made,
everything is legal; if not, it is payola. However, if something of
value (say, $500 cash, or a DVD player, or 100 CDs) is given to a
station for the purpose of GIVING IT AWAY ON AIR during
regular programming, then NO announcement is required, and
the situation remains perfectly legal. (This is how game shows
work.) Here are some FCC examples:

40 FCC 3.119 Example A-1 reads: "A record distributor furnishes
copies of records to a broadcast station or a disc jockey for
broadcast purpose [i.e., airplay]. No announcement is required
unless the supplier furnished more copies of a particular recording
than are needed for broadcast [airplay] purposes. Thus, should
the record supplier furnish 50 or 100 copies of the same release,
with an AGREEMENT by the station, express or implied, that the
record will be used on a broadcast [i.e., the song will get airplay],
an announcement would be required because consideration
BEYOND the matter used on the broadcast was received."
(emphasis added). This example points out the difference
between giving a station something to keep, versus giving a
station something to giveaway on-air; this is the thing that makes
the difference. Here's more clarification:

Section C reads: "[No announcement is required] where service
or property is furnished free FOR USE ON or in connection with a
program, but where there is neither payment in consideration for
broadcast exposure of the service or property, nor an agreement
for identification of such service or property BEYOND ITS MERE
USE ON THE PROGRAM" (emphasis added). Thus, you can
give a station whatever you want, as long as it is given away
on-air, i.e., used on the regular programming. More:

Example C-10 reads: "Free books or theater tickets are furnished
to a book or dramatic critic at a station. [All] the books or plays
are reviewed on the air. No announcement is required." But:

Example B-7 reads: "A perfume manufacturer gives five dozen
bottles to the producer of a giveaway show, SOME of which are
to be identified and awarded to winners on the show, the
remainder to be RETAINED by the producer. An announcement
is required since those bottle of perfume retained by the producer
constitute payment for the identification." (emphasis added).

So, it should be clear that giving a station anything for giveaway
on air is perfectly legal; giving a station anything that will NOT be
given away on air (except of course your CD for airplay), if there
is an understanding that you are doing it so they will play your
stuff, is payola.

Conclusion: Paying stations is not a tool for a small indie to get

Bryan Farrish Radio Promotion is an independent radio airplay
promotion company. 818-905-8038


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