Pay-for-play scandal entangles Celine Dion - Friday 12th of August 2005
Celine Dions record company sought to artificially boost her popularity in the months before her 2003 Caesars Palace debut by bribing radio stations nationwide to play her music, according to documents released this week as part of a burgeoning pay-for-play scandal rocking the music industry.
Sony BMG, the nations second-largest record company, agreed Monday to stop bribing radio programmers and pay $10 million as part of an agreement springing from an investigation by New York Attorney General Eliot Spitzer.
Calling the pay-for-play practice "pervasive," Spitzer suggested other industry giants still under investigation could face similar penalties.
The agreement between Spitzer and Sony BMG indicates that in most instances Sony BMG bribed radio programmers with cash or electronics to play songs by artists such as Good Charlotte, Gretchen Wilson and Audioslave.
But in Dions case, the company used a more elaborate scheme that New York prosecutors called "equally deceptive" to the public, according to the agreement.
Although Dion has sold some 140 million records worldwide, by late 2002 she had gone five years without a releasing a hit song.
According to the settlement, around that time Sony BMGs Epic Records struck deals with stations around the country to play two of her new tracks a certain number of times each week.
In exchange, Epic financed contests where those stations listeners could win trips to Las Vegas, rooms at Caesars and concert tickets to see her show, "A New Day... ."
One e-mail Spitzers office released Monday indicates Dion was personally involved in the contest, but that could not be confirmed this week.
"There will be one grand prize (meet Celine, play blackjack with Celine, have lunch with Celine)," an Epic records employee wrote to Infinity Broadcasting, which operates 180 stations nationwide.
Attempts to reach Dion for comment were not successful Wednesday. A spokeswoman for "A New Day..." said the singer and her management representatives were traveling and could not be reached.
The type of promotional support offered to those willing to play Dion songs can be even more enticing to stations than a cash bribe because "it lowers overhead, draws listeners and boosts ratings," the settlement states. "This support influences programming decisions, a fact not disclosed to consumers."
A 1960 federal law bars record companies from offering undisclosed financial incentives in exchange for airplay, a key driver of an artists record sales. During radio scandals that unfolded decades ago, the practice was called "payola," a contraction of "pay" and "Victrola," the old wind-up record player.
"Sony BMG has provided this support to exert the same influence over the stations airplay decisions as when a bribe goes directly into a station employees pocket," the settlement states. "The practice is equally deceptive."
In one e-mail released by Spitzer on Monday, an unnamed Epic promotions employee complains that a radio station wasnt giving Dions song proper exposure. The station only played Dions "I Drove All Night" during late night hours, when fewer people were listening.
The e-mail states, "Ok, here it is in black and white and its serious: if a radio station got a flyaway to a Celine show in Las Vegas for (adding Dions song to its playlist), and theyre playing the song all in overnights, they are not getting the flyaway. Please fix the overnight rotations immediately."
On Monday, Sony BMG acknowledged in a statement that some of its employees had engaged in "wrong and improper" practices, but did not say whether it fired or disciplined any of those employees.
It is not clear whether the people who won the trips to Las Vegas were always listeners.
Spitzers investigation found Sony BMG gave gifts to radio station employees by disguising them as contest prizes going to a listener.
"Sony BMG promotion department employees go to considerable lengths to conceal such fraudulent transactions within Sony BMGs accounting systems," the settlement document states.
"Because the law requires Sony BMG to record a winner name and social security number for each contest prize in excess of $600, Sony BMG employees have solicited false `winner names and social security numbers from the radio programmers who in actuality received the `prize. "
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