Earlier this month, the Federal Communications Commission issued an Enforcement Advisory warning radio broadcasters not to engage in “payola” practices in connection with having musical artists perform at radio station events or festivals.  

As the FCC explained, “payola” is the “unreported payment to – or acceptance by – employees of broadcast stations, program producers, or program suppliers of any money, service, or valuable consideration to achieve airplay for any programming.”   If a payment has been made in exchange for airplay, the broadcaster is required to disclose that during the broadcast.

In its Enforcement Advisory, the FCC expressed a concern about the manipulation of radio airplay by a broadcaster based on a musical artist's agreement to participate in a broadcast station's promotion or event, often without receiving payment for the appearance.  

The FCC warned, “broadcast stations that host promotions or events that include artists (whether or not the artists are compensated for the appearance) must take appropriate steps to ensure that all such promotions or events comply with the payola requirements and general public interest components of the Act and the FCC's rules and avoid agreements that covertly increase the amount of airplay base don an artist's performance or appearance at a station's promotion or event.”