Spitzer the Blitzer goes after music label payola
The music labels, accustomed to bullying teenagers, appear to have pissed off the wrong man. New York attorney general Eliot "The Blitzer" Spitzer has served up subpoenas to the major labels, as he digs for information on their relationships with promoters who are thought to pay radio stations to play certain songs, according to a report in The New York Times.
The paper states that Universal Music Group, BMG, EMI Group and Warner Music Group have all been asked to turn over contracts and billing records that show their ties to these so-called song middlemen. This method of paying promoters goes around a federal statute most commonly known as the payola law that forbids bribing radio broadcasters.
Spitzer's investigation shouldn't be too troubling for the labels. It's thought that the payola practice has died down significantly from its glory days many years ago. In addition, the labels have faced a worse attack before when the federal government charged them with and made them pay up for large scale CD price-fixing operations.