RADIOACTIVE FALLOUT

The L.A. Times’ Charles Duhigg and Walter Hamilton spent the day reading the assurance document and aggregated emails issued yesterday by Eliot Spitzer’s office, liberally quoting from the latter in their Page One story in this morning’s edition. These documents, they wrote, depicted the seamier side of the music business, in which under-the-table payments and nudge-and-wink deals were so common that no one even tried to hide them.”

The story points out that the settlement allows Sony BMG to continue such promotional gambits as booking acts for radio shows, listener giveaways, the comping of tickets, modest personal gifts and meals costing up to $150 per person, meaning the Ivy wine list is still fair game.

Duhigg and Hamilton also speculated about how much the settlement would affect the culture of Sony BMG, a fascinating subtext. Additionally, “company insiders” told the writers they expected no further firings as a result of the probe, and quoted an unnamed SBMG exec as saying, "Paying for songs has been almost standard operating procedure for years and years. From this day forward, heads will roll. But, in terms of corporate scandals, we're talking about TV sets and trips to Florida. It's not Wall Street scandals."

They ended their report with a quote from Donnie Michaels of WHYI Miami, who was outed in the e-mails. "I was just doing what everyone else was doing."

“The finding that gifts were used to help tailor the playlists of many radio stations comes as audiences show signs of rejecting the music choices made by programmers” Jeff Leeds and Louise Story pointed out in The N.Y. Times. “The iPod and other portable devices have begun cutting into the popularity of radio, and the growth of satellite radio has been putting pressure on the station owners to play a broader range of music.”

The Times reporters noted that “The industry has been divided over the impact of the settlement. Many executives say Mr. Spitzer's inquiry amounts to too little too late: radio companies like Clear Channel and Cox Radio severed their deals with independent promoters before the investigation began, for example. Others, including several independent record labels, say the settlement could signal a shift that might break the major record companies' chokehold on the airwaves.”

Without naming his source, The Wall Street Journal’s Ethan Smith wrote, “The dismissal of Mr. Klaiman was described as the company's decision, not a requirement of the settlement.”

The Washington Post noted that Spitzer took a shot at the FCC yesterday, stating, "Whoever goes first, gets it. It would have been good if the FCC had looked at this."

But FCC Commish Jonathan Adelstein called for the agency to open its own investigation "based on" Spitzer's findings. "It took someone with Spitzer's tenacity and subpoena power to bring forward solid evidence," he said.

The N.Y. Daily News pointed out that the biggest payola-related fine levied by the FCC was a mere $18k and compared the $10 million to the $550k Janet Jackson was fined for her Super Bowl breast-baring. The story revealed Edelstein’s concern for playlist quality control (maybe he’s a wannabe rock critic): "It's unfair to listeners if they hear songs on the radio because someone was paid off, not because it's good music. We need an ... investigation to determine whether these practices violate federal payola laws."

Fox News columnist Roger Friedman opened his piece with fangs bared, writing, “I always say, when people ask me, that the so-called vipers of the movie business would not last a day in the record business. Now New York state Attorney General Eliot Spitzer's office has decided to prove the point.” He was just getting started: “The memos…will be mind-blowing to those who are not so jaded to think records are played on the radio because they're good. We've all known for a long time that contemporary pop music stinks. We hear ‘hits’ on the radio and wonder, ‘How can this be?’ Now we know.”

Later in the commentary, Friedman moved in for the kill. The settlement, he said, “should be $100 million. And this won't be the end of the investigation. Spitzer's office is looking into all the record companies. This is just the beginning.” He closed the piece with a conspiracy theory: “Spitzer is said to be close friends with Sony's new CEO, Andrew Lack, who publicly welcomed the new investigations earlier this year when they were announced. Did Lack anticipate using Spitzer's results to clean house? Stay tuned ...”