Turning toward the radio industry, the Federal Communications Commission is looking into whether iHeartMedia is compelling artists perform at its upcoming country music festival for free or reduced pay in exchange for more favorable airplay.
FCC chairman Brendan Carr, in a letter to iHeartMedia CEO Robert Pittman on Monday, said that the inquiry relates to possible violations of government rules requiring broadcasters to disclose payments or other consideration for airing certain programming. Under the so-called “payola” rule, all sponsored arrangements must be identified.
“I want to know whether iHeart is effectively and secretly forcing musicians to choose between, one, receiving their usual, ordinary, and full scale compensation for performing or, two, receiving less favorable airplay on iHeart radio stations,” Carr wrote.
In a statement, iHeartMedia said it looks forward to “demonstrating to the Commission how performing at the iHeartCountry Festival – or declining to do so – has no bearing on our stations’ airplay, and we do not make any overt or covert agreements about airplay with artists performing at our events.” It added, “The iHeartCountry Festival provides the same kind of promotion that that we see with artists on talk shows, late night television, the Super Bowl and in digital music performances and events: the promotional value to the artists is the event itself, and, in our case, is unrelated to our radio airplay.”
The radio and podcasting company is hosting on May 3 its annual country music festival in Austin, Texas. Performers include Brooks & Dunn, Thomas Rhett, Rascal Flatts, Sam Hunt and Nate Smith, with Bobby Bones hosting the event.
The FCC is interested in how companies like iHeartMedia handle artist solicitation and compensation, as well as the process put in place to ensure compliance with regulations regarding sponsorship identification. It requested information on artists scheduled to appear, any compensation (financial or otherwise) they’re receiving and typical performance fees for the musicians outside of the festival. The company must also state whether artists’ participation at the event will influence their airplay.
“Please explain how iHeart’s position has been conveyed to musicians, artists, and acts and how iHeart plans to ensure the relevant outcome,” the letter states, signaling concern into whether performers were manipulated into accepting reduced fees.
Additionally, the letter asks iHeartMedia to explain artists’ incentives for such arrangements and a list of musicians invited to appear but declined to do so. Other information that was requested includes special trainings that have been conducted to ensure compliance with government rules and policies over sponsorship identification requirements.
The letter referenced an enforcement advisory issued by the FCC earlier this month. “To the extent that radio industry executives believe that the FCC has looked the other way on ‘payola’ violations in recent years, I want to assure you that this FCC will not be doing that,” Carr wrote.
iHeartMedia was given 10 days to respond.
The letter to iHeartMedia is one of many moves from Carr, who has ordered an investigation into NPR and PBS over possible violations of government rules by recognizing financial sponsors on the air. He’s also asserted authority over parts of Paramount’s pending merger with Skydance by leveraging the agency’s control over the transfer of broadcast licenses.
Read iHeartMedia’s full statement below:
We appreciate FCC Chairman Carr’s interest in ensuring the radio industry is compliant with all applicable laws and regulations and will be responding expeditiously to the specific questions posed in the Chairman’s letter about iHeart’s upcoming Country Festival.
The Commission’s recent Enforcement Advisory to the radio industry as a whole stated that manipulating airplay based on artist participation in station events without proper disclosure violates federal laws.
We look forward to demonstrating to the Commission how performing at the iHeartCountry Festival – or declining to do so – has no bearing on our stations’ airplay, and we do not make any overt or covert agreements about airplay with artists performing at our events.
The iHeartCountry Festival provides the same kind of promotion that that we see with artists on talk shows, late night television, the Super Bowl and in digital music performances and events: the promotional value to the artists is the event itself, and, in our case, is unrelated to our radio airplay. We’re very proud that over the years we’ve had artists ask us to be a part of the iHeartCountry Festival, and in fact we’ve had artists make repeat appearances over the years because it is an important event that enables them to reach our audiences and enhance their careers.