Payola

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News broke yesterday that New York Attorney General Eliot Spitzer’s 11-month investigation into radio payola has resulted in a $10 million dollar settlement from Sony, with similar arrangements with the other labels to follow.

Everyone is “outraged” of course, but fighting payola is like crushing spiders — they lift up some rocks once in a while, valiantly stomp the offenders, and then go back to pretending like it’s not a naturally occurring state of affairs. The practice became a federal crime in the 1950s after the major labels complained to the government about independent labels bribing their way onto the scene — paying the DJs was the big boys’ game plan, and they didn’t like these new kids using the same tactics. So, the direct payment of a third-party gatekeeper for playing a song became illegal, which let the major labels invent a much more capital-intensive, complicated payola system involving “independent consultants” that continued the same game while keeping out smaller labels lacking the necessary “promotion” budget. (For more, see Fredric Dannen’s book Hit Men.)

The music industry is extremely unstable: What will “hit” is almost completely unpredictable and the companies involved must scurry around trying to figure out how to match consumers’ wildly fickle and protean tastes. The easiest way to stabilize the market is to secure exposure. Consumers don’t usually buy songs they’ve never heard, and with lots of plays on the radio or on MTV (which for you youngsters out there, used to play music videos), simple musicians become “stars” overnight to even the most passive, casual listeners/viewers.

So, payola is a natural thing for companies to pursue, but in the other corner, there’s the “odd” American liberal idea that the airwaves should be for the people, whether owned by a private or public company. Federal prosecutors do not normally pursue payola cases, but there is an ethical and legal precedent that bribing DJs and cultural intermediaries is a bad thing, and I would assume that most Americans agree with this principle. This current case proves again that the United States government takes pop culture seriously, and they should: Movies, magazines, songs, and images are not only big business, but define our identities, shape social discourse, and end up becoming explanatory agents for the world around us.

Meanwhile in Japan, there is no concept of “payola” or widespread consciousness of the practice, seeing that direct payment for the exposure of songs is a standard, semi-legal part of industry. The Japanese government has never shown much antipathy towards cartels — the dust is so thick on the Anti-Monopoly Law of 1947 that you can hardly read the text — and no one particularly thinks that media outlets should be under different guidance than supermarkets. If Coca-Cola can pay for an end-aisle display at a grocery, why can’t Sony buy time for Puffy on J-Wave?

But this attitude of Japanese policy-makers resembles another theme of Japanese society: Pop culture is rarely taken seriously. And that’s crazy, seeing how vibrant popular culture is in Japan. Some of this is that Japan’s pop culture market is relatively new, and I assume that the old men who run the country couldn’t possibly see the importance of a bunch of silly, frilly things primarily consumed by women and children (especially since you’re supposed to give up all interests in these frivolous matters after becoming a shakaijin).

Now that the Japanese “contents” industry is a ¥20 trillion market, JETRO and the think tanks are starting to look at pop-cult with a more serious eye, but if the bureaucrats and politicians continue to support oligopolistic industries and suppress competition as part of a national economic strategy, I doubt there would be any precedent on which to go after payola.

While the American government is hardly a noble knight for killing the occasional exhibition beast, as a liberal American distrustful of big business and collusion, I do agree with the anti-payola law. Payola ultimately benefits the firms with the most capital and acts as an entry barrier to smaller companies with innovative ideas. Creating a record costs almost nothing, but getting it played evidently costs hundreds of thousands of dollars, plasma televisions, drugs, prostitutes, and exotic vacations. But that’s all over now, right?

Update: Here is an interesting pro-payola article from Slate.com that brings up a lot of similar points. I am hesitant to agree with his overall idea that consumers can perfectly counterbalance industry collusion through their purchase power. Even if we all hate Celine Dion and don’t buy her records, she’s still a “star” if played on the radio a million times in the major markets, and a lot of other companies will use that artificially frequent radio play as a guide for their own organizational decision making. If successful, payola creates fake stars, who eventually create a distortion in the cultural code.

Marxy wrote a lot of essays back on his old site Néomarxisme. This is one of them.

19 Responses

  1. jaykayess Says:

    It doesn’t seem too naive think that Japanese pop culture is probably so vibrant because it’s not taken seriously, not in spite of the fact. After all, it’s hard to take risks, be creative, be funny and new when the stability of a multi-billion dollar industry and its fabulously overpaid execs. is riding on your creative output.

  2. Chris_B Says:

    Have pity on the poor programming directors, without the independant consultants, where would they get their luxury goods and hookers?

    One tiny correction, no company “owns” any frequency spectrum in the USA. They may be granted the right to use a certain frequency range by the FCC through various methods, but they do not own it.

  3. marxy Says:

    It doesn’t seem too naive think that Japanese pop culture is probably so vibrant because it’s not taken seriously, not in spite of the fact.

    I think I meant vibrancy as “size,” which is a product of economic growth and GDP more than anything else. (Although this is hard to disprove, and therefore prove, since Japan is #2 in GDP.) There are a lot of very, very stale sectors of the Japanese pop world – J-pop, variety shows – which are due to the management companies’ control of the market. I don’t know if you’ve noticed, but the Johnny’s Jimusho gang aren’t much in the way of singers or actors, and yet they dominate both music and drama worlds – always and forever. It’s like if NKOTB had a twenty-year streak as the host of every show on TV.

    I think that anything like the Sopranos, the Simpsons, and the Daily Show can’t exist on TV in Japan primarily because nothing is marketed to serious adults or semi-intellectual/political college students. Society’s most intellectual developed citizens are not home to watch TV anyway due to the employment system, so some of this “not taking it seriously” is somewhat set in stone. (Unless for some reason, they make everyone start going home at 6 every day.) Oh, this is complicated… I feel like I’m taking on too much.

    I’m intrigued by your comment though. What are some ways in which we can concretely say that Japanese popcult is more interesting because the government and the critical, adult media rarely interefere?

  4. Chris_B Says:

    See http://somafm.com/payola/payola2.pdf for some nice juicy details on the issue in question.

  5. nate Says:

    i feel like an ass anytime I attach “ian” to the end of a name, but approving of this kind of tactic for creating a useful narrative to motivate a consumer body is tacit approval of the straussian methods used by pnac and potus.

    Momus has nothing but praise for the “useful lie” approach to top-down culture, but man this stuff gives me the willies.

    (but I can’t be the only one that watched “the power of nightmares”).

  6. guest Says:

    Yeah, and Momus (like Strauss) owes a philosophical debt to Walter Lippmann as well…

    And Machiavelli before that…

  7. guest Says:

    All of which would make him- to his own chagrin, no doubt- a neoconservative!

  8. alin Says:

    pop culture is rarely taken seriously. And that’s crazy, seeing how vibrant popular culture is in Japan.

    don’t you think this is part of a more general, quite strong tentency to separate what could be lumped together as ‘asobi’ from , ‘shigoto’ – in a wider sense. Pop culture, regardless of it’s volume and intensity would by default fall into the first category. which would mean it can’t be taken too ‘seriously’.

  9. marxy Says:

    I think that’s a good rephrasing. Momus, though, may not like that “asobi” and “shigoto” are stern opposites in a land of supposed neither/or post-modernism.

    There is an American tendency to take pop culture WAY too seriously – one part literary deconstruction, one part trust-busting free-market protectors. As an American myself, I tend to think this attitude leads pop culture into interesting directions, and I’m not sure how much this exists in Europe or elsewhere.

  10. porandojin Says:

    i may be wrong but i think there are two countries where pop music may be smth more than just sound wallpaper- Great Britain and Russia …

  11. alin Says:

    Momus, though, may not like that

    well momus can do the dirty job this time. (though i wouldn’t see a reason for it here // not yet) i don’t think the opposites are actually stern; they’re very relative and volatile (just like soto/uchi etc). for example in this case luxury cars or gadgets or computer games are in themselves equaly ‘asobi’ as music. yet (and this is not meant to explain the whole mystery of it) possibly because they’re and have been for a while much closer to the heart of the economy, and have a kind of universal aura of credibility to them they’re taken a bit more seriously. That’s one way to look at it.

    pop culture WAY too seriously
    pop culture is by definition american. to put it differently, i don’t think any other country has a pop culture to stand comparison with the american pop culture. in just about every other culture there is the issue of how much the local element can withstand it or be drowned by it. I know this is a 30 or so years old discourse but it’s still valid. (don’t know for how much longer.)

    there surely is something, something massive, in japan that fits any description of pop culture but to try define it by the dynamics and rules of american pop-culture is a wrong place to start from. for many reasones one being the fact that much of it has developed as an effort to keep back american pop-culture. (this would be a long essay in itself and i know i’m jumping from economy and politics to content)

  12. alin Says:

    man, another earthquake, the end of japanese pop culture is nigh.

  13. Chris_B Says:

    hehehe, yeah that quake kinda set off nerves in our house.

  14. marxy Says:

    I didn’t feel the quake, but I was in Otemachi and I think they’ve outlawed earthquakes in the richer areas of Tokyo.

    have a kind of universal aura of credibility to them they’re taken a bit more seriously.

    Maybe. I still think that a lot of it is that older men are not consumers of music, TV, fashion, movies, and most other pop culture, and therefore these fields cannot possibly warrant any attention from the government. On the other hand, I’m not sure the golf market is regulated or expertly analyzed either.

    The bigger picture is that the principles of anti-payola prosecution in the US don’t exist within the framework of the Japanese government or economy. I don’t think that METI or politicians are going after these kinds of cartels in other more “serious” industries, and in fact, the government is often trying to knock firms out of the market to create more stable oligopolistic arrangements. And seeing that a lot of the talent jimusho head have direct and indirect connections to the LDP (Rising Pro’s Taira was instructed in tax fraud from Kato Koichi’s secretary, etc.), I doubt that anyone is going to start busting up the entertainment world soon. The only thing not tolerated is excessive tax evasion, because that’s the government getting bilked out of their cut. They opened up an investigation against Nigo last year and seem to pretty regularly look at these small, non-public “cultural” firms.

    the dynamics and rules of american pop-culture is a wrong place to start from

    Maybe so. I think Germany may be a better comparison, and a lot of German TV shows remind me of Japan. America must be the only country where normal TV dramas are still shot on real film stock and not cheap video. Overall though, to get a handle on what is “pop culture,” Japan provides some major clues. They shouldn’t be expected to be the exact same as America, but how the markets differ could suggest a lot about how culture is made in general.

  15. Chris_B Says:

    The little I saw of German TV was no where near as boring as what I see on TV here, but I didnt watch really enough to compare.

    On the other hand, I’m not sure the golf market is regulated or expertly analyzed either.

    Actually the real estate companies and the holding companies who ran the golf courses are definitely regulated since they were essentially dealing in securities and securitization of product. If you mean the golf club/ball/whatever companies, well I’m sure that there is some minister of something whose job it is to measure and regulate said such… Of course when that minister retires, he is guaranteed a sweet golfing amakudari job.

  16. alin Says:

    Japan provides some major clues.

    how? what do you mean more concretely? am i thick? i still don’t quite see the point nor the logic of this exercise. there does seem to be a point other than chatting (might if i read all your blog from the start). i mean the arguements usually go from a mildly america-centric stance to stuff like little I saw of German TV was no where near as boring as what I see on TV here and the occasional disruption by momus. and then it slips into an overall critique of japan which is sometimes balanced by a pseudo-critique of the US, which really comes across as some sort of homesickness rather.


    anyone watched thai tv? it’s even more boring. sometimes they have people just talk for hours in front of the camera in a foreign language, no camera cuts and no comercials breaks. (come to think of it that’s actually thai radio, they have one person just talk shit for hours non-stop but thai tv is pretty fucking boring too)

    yep, i still don’t quite get the point of this comparing game. i’m sure the intentions are good.

  17. alin Says:

    where does takarazuka fit in ?

  18. jed Says:

    the old men who run the country couldn’t possibly see the importance of a bunch of silly, frilly things primarily consumed by women and children (especially since you’re supposed to give up all interests in these frivolous matters after becoming a shakaijin).

    What if these old men finally did see the importance, & what if people decided not to give up these frivolus matters?
    just a thought.

  19. alin Says:

    the backbone of Ishihara’s career is his family’s popularity in the pop industry. dj koizumi is releasing records so it can’t be that frivilous to the old men