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Clear Channel, CBS, Citadel and Entercom are talking with the FCC about paying fines of as much as $1 million apiece, but Democrat Jonathan Adelstein wants a price tag that could exceed $10 million per company.
FCC AND RADIO POW-WOW OVER PAY-FOR-PLAY
Government Now Negotiating with Clear Channel, CBS, Entercom and Citadel on Fine Amount
The FCC has finally entered the pay-for-play fray.

Egged on by New York State Attorney General Eliot Spitzer’s investigation of the practice at radio, the FCC and four of the nation's largest station groups are in active settlement talks, according to Saturday’s L.A. Times and N.Y. Times.

Clear Channel, CBS, Citadel and Entercom, the latter the target of a Spitzer suit last month, are talking with the FCC about paying fines of between $1.5 and $3 million apiece, but at least one Commissioner, Democrat Jonathan Adelstein, wants a price tag that could exceed $10 million per company. The N.Y. Times reports that FCC officials had balked at previous offers of between $500k and $1 million.

If the two sides do not come to an agreement, the agency is expected to launch a broad investigation with requests for internal documents and e-mail messages from the chains.

The radio stations disagree with the FCC's contention that the practice of labels supplying them with CDs, concert tickets and other goods in exchange for artist airplay and promotion violates federal regulations unless the deals are disclosed on the air.

Radio execs claim these practices are standard and that it would be difficult to disclose such a tacit agreement each time an artist is mentioned. Insiders report that the FCC has proposed that stations abide by a compliance plan similar to the terms negotiated by Spitzer's settlement last June with Sony BMG Music Entertainment that prohibits employees from giving radio programmers gifts or meals valued at more than $150.

Some FCC officials have OK’ed "spin programs" as long as payments were disclosed, which is reportedly what Entercom will argue in court after getting sued by Spitzer last month over allegations of illegal pay for airplay.

The FCC reportedly met with the radio companies for the first time in February. Spitzer's office has been slow to hand over documents, arguing that the agency's investigation is a day late and a dollar short.

Radio execs are also trying to get a hold of the FCC’s evidence in their investigation, but the agency, citing a confidentiality agreement with Spitzer's office, have so far refused to provide anything beyond summaries of wrongdoing.

People close to the negotiations said FCC officials and radio executives remain eager to reach an agreement.

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