MICHELE NORRIS, host:
The Federal Communications Commission is on the verge of announcing a settlement with four of the nation's largest broadcasters over payola. That's what record companies pay to radio stations so they will play their songs. The four broadcasters - Clear Channel Communication, CBS Radio, Entercom Communications Corporation and Citadel Broadcasting Corporation - together own about 15,000 stations. NPR's Neda Ulaby says the deal may come with benefits for local and independent musicians, as well.
NEDA ULABY: FCC Commissioner Jonathan Adelstein says what's about to break is a very big deal.
Mr. JONATHAN ADELSTEIN (Commissioner, Federal Communications Commission): This is the largest collective fine in the history of American broadcasting, larger than any combined indecency fine. By our standards, this is as big as it gets.
ULABY: While Adelstein would not confirm details of a settlement still in the final stages of negotiation, NPR sources confirm reports of a $12.5 million fine spread out between the four broadcasters. Under a separate agreement, those broadcasters have also promised to give 8,400 half-hour segments of air time a year to independent and local musicians.
Mr. PETER GORDON (President, Thirsty Ear Records): I think we need to learn how to play nicely together.
ULABY: Peter Gordon is president of an independent label called Thirsty Ear Records. He was also the lead negotiator for the American Association of Independent Music during settlement discussions with the broadcasters.
Mr. GORDON: The rules have been hashed out. The basic tenets are access and transparency. Those rules will help our community to be able to have a dialogue with radio and not be discriminated against just because we're independents and do not have the resources to get to the head of the line.
ULABY: At least one big label had the resources to get to the head of the line at WKSE in Buffalo, New York.
(Soundbite of music)
Unidentified Man #1: You are listening to KISS 98.5. Right now.
Unidentified Man #2: Yes I am.
ULABY: That's one of the radio stations owned by Entercom Communications. It was found to have traded music spins for gifts when then New York Attorney General Eliot Spitzer announced a $10 million settlement with Sony BMG Records in 2005. Commissioner Jonathan Adelstein urged the FCC to pick up Spitzer's investigation and look into the broadcast side of the payola equation.
Commissioner ADELSTEIN: We had gotten, basically, truckloads full of old e-mails and things like that, but I feel like we didn't really do as much as we could have to dig through those and catalog it. And one of the ideas of the settlement is basically to keep us from having to go through all that and to keep them from having to continue to produce as much material as they were producing for us.
ULABY: Adelstein says that while there are no specific provisions for enforcement in the FCC settlement, he's confident the broadcasters will comply. Howard Lieberman is a communications lawyer. He believes that broadcasters have reasons of their own to settle.
Mr. HOWARD LIEBERMAN (Communications Lawyer): These broadcasters are all in the process of either selling stations - as the case of Clear Channel or CBS - or they're in the process of having their licenses renewed. And all of that is on hold, typically, when there is a serious investigation at the FCC.
ULABY: The big winners in the pending settlement may be independent musicians. A spokesman for the advocacy group Future of Music Coalition pointed out that the first test case could come this week, with a new record from the independent band, Arcade Fire. It's been showcased on "Saturday Night Live", its last tour sold out, and it was profiled in yesterday's New York Times magazine, as well as by NPR two years ago. But will the band get significant airplay on commercial radio?
(Soundbite of music)
ARCADE FIRE (Rock Band): (Singing) I walk down to the ocean, to wake (unintelligible).
ULABY: We'll see. Neda Ulaby, NPR News.
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