Paying the Piper a Little Something Extra: A Short History of Payola

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Payola became a household word in 1959, thanks to a high-profile trial that made examples of two legendary disc jockeys – Alan Freed and Dick Clark (above).

In 1959, Alan Freed, the most popular disc jockey in the country, was fired from his job at WABC after refusing to sign a statement that he’d never received payola to play a record on the air. For most of America, the word payola was a new one. But for anybody in the music business, it was as old as a vaudevillian’s musty tuxedo.

19th-Century Pay to Play

Coined in the early 20th century, the word payola is a hybrid of “pay” and “Victrola” (the first popular portable phonograph, the Victrola was a crank-driven turntable with a built-in speaker that looked like an oversized trumpet) - and it's been a fact of the business since the late 1800s.

Back then, music publishers routinely plied traveling vaudeville performers with gifts to spread the latest songs across the country. When audiences from Schenectady to Sacramento heard the featured songs, it would result in increased sheet music sales, then the industry’s main source of revenue.

It didn’t stop there. Often there were shills in the vaudeville theaters, paid by publishers to applaud a little louder for particular songs, driving up their popularity. And then there were the guys in charge of stocking the song rolls inside coin-operated player pianos in saloons, who weren’t above taking a little extra to load in certain titles.

As the new medium of silent movies flourished in the early 1900s, publishers cozied up to theater organists, paying them to add specific melodies to their repertoires. Today, we all complain about the fifteen minutes of commercials before big-screen fare. But a hundred years ago, payola-supported entertainers called “illustrated slide singers” projected still photos with song lyrics before a movie and invited audiences to “follow the bouncing ball.” The prospect of a forced sing-a-long with “In The Good Old Summertime” makes a promo spot for Taco Bell’s XXL Chalupa look a little more tolerable.

By the early 1920s, payola was an accepted fact of the business. Publishers were gambling as much as $20,000 on the promotion of every hoped-for hit. With the simultaneous rise of radio and cheaper phonograph records, it wasn’t long before every record jacket that arrived at a radio station had a twenty dollar bill tucked inside.

So rampant was the practice that in the early 1930s, the National Broadcasting Corporation even proposed bringing it above board, by charging music publishers and record companies a flat rate for each exposure of a new song. The problem was, this would’ve interfered with the individual deals that the era’s singing stars and big band leaders already had in place.

Tips for the Poo-bahs of Musical Fashion

In the mid-1940s, performers began sharing the payola pie with a newly emerging class, disc jockeys. One early pioneering DJ said that the money that came along with a new record was merely the equivalent of a head waiter’s tip for a good table in a nightclub.

In 1950, there were approximately 250 disc jockeys in the US. By 1957, the number had grown to over 5,000. The increase was partially due to the sheer amount of new records being produced. As the name suggests, a disc jockey was responsible for sorting through all these releases. These on-air personalities had so much clout with younger listeners, Time magazine called them the “poo-bahs of musical fashion and pillars of U.S. low- and middle-brow culture.”

Aware of their rising status and their importance to the success of a single, disc jockeys cut deals with record labels and distributors. A typical deal for a mid-level DJ was $50 a week, per record, to ensure a minimum amount of spins. More influential jocks commanded percentages of grosses for local concerts, plus time-honored swag like cars, cases of liquor and the services of prostitutes. One DJ later described the decade “as a blur of booze, broads and bribes.”

As payola escalated, Variety and Billboard did lengthy features, calling for reform and government intervention. Fingers pointed and words flew, but it wasn’t until the TV game show scandals of 1958 (famously portrayed in the movie Quiz Show) that the government got seriously involved. Once the “Do you now or have you ever...?” questions began, the jig was up.

With the threat of losing their licenses, some radio stations took the precaution of firing disc jockeys who might put them at risk. In November 1959, in closed and open sessions before the U.S. House Oversight Committee, 335 disc jockeys from around the country admitted to having received over $263,000 in “consulting fees.” That figure was only the tip of the payola iceberg (before the hearings, a Chicago DJ confessed that he had once taken $22,000 to play a single record). The trial heated up when the two most influential jocks in America took the stand.

The Tale of Two DJs

Alan Freed and Dick Clark both played important parts in the rise of rock ‘n’ roll. Freed embodied the incendiary spirit of the music more than Clark, famously refusing to play white cover versions of black songs, such as Pat Boone’s “Tutti Frutti.” And though they both denied ever accepting payola, it’s almost impossible to imagine two young, popular disc jockeys not succumbing to a little temptation. Guilty or not, it was Freed who ended up taking the fall for DJs everywhere.

Why was he singled out? Freed was abrasive. He consorted with black R & B musicians. He jive talked, smoked constantly and looked like an insomniac. Clark was squeaky clean, Brylcreemed handsome and polite. Once the grilling started, Freed's friends and allies in broadcasting quickly deserted him. He refused to sign an affidavit saying that he’d never accepted payola. WABC canned him, and he was charged with twenty-six counts of commercial bribery. Freed escaped with fines and a suspended jail sentence. But he died five years later, broke and virtually forgotten.

Previous to the trial, Dick Clark had wisely divested himself of all incriminating connections (he had part ownership in seven indie labels, six publishers, three record distributors and two talent agencies). He got a slap on the wrist by the Committee chairman, who called him “a fine young man.” As Clark told Rolling Stone in 1989, the lesson he learned from the payola trial was: “Protect your ass at all times.” Surprisingly candid words from the guy once called “America’s Oldest Living Teenager.”

After Freed went down in 1960, Congress amended the Federal Communications Act to outlaw “under-the-table payments and require broadcasters to disclose if airplay for a song has been purchased.” Payola became a misdemeanor, with a penalty of up to $10,000 in fines and one year in prison. But no one has ever gone to prison on payola charges, and the loophole in the legislation was that it didn’t say anything about undisclosed payments.

And so payola has continued, taking various forms - everything from a line of coke to the services of an independent promoter to a spot ad masquerading as just-added song – while playing duck and cover with the law. But maybe it’s worth remembering what a commissioner of the FCC said in the mid-1970s: “Hell, there’s payola in every industry. It’s common knowledge that most products and services are sold not just on their interest quality. I mean, payola is just an American Business practice.”