SONY BMG settle payola claim

September 2005

Record Labels

Sony BMG is paying $10M as a settlement following Attorney General Eliot Spitzer’s payola investigations in the US. The money will be paid to non-profit organisations that promote music education. The investigation illustrated that to get Franz Ferdinand played on radio station WKSE, the label paid $4,000 which was used to send radio executives to Miami. It is also said to have disguised ‘payoffs’ such as flat-screen TVs by referring to them as “contest giveaways”. It is expected similar settlements with the other majors will be arrived at soon. Sony BMG responded by firing its promotion executive at Epic and disciplining four other executives at Sony Urban and Epic. Spitzer is now thought to be investigating radio stations in the United States on the similar matters.


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