Fighting pay-for-play

Meanwhile, there is strong suspicion that individual stations receive additional payments from indies above and beyond the agreed-upon annual "promotional budgets."

For instance, imagine that a label desperately needs an add; it offers the indie $6,000 to get it done and the station makes room for the song on its playlist. Will the station see a portion of that $6,000 payment? Says the head of promotion at one label: "I guarantee you. Otherwise, there's no incentive for the station to make room."

Adds another indie: "You can't see it, but you sense it's out there; the kickback."

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The extraordinary amount of money spent on indies has another, perhaps, unintended effect: locking small labels off the mainstream, commercial airwaves. "The only people who can play that indie game are the ones with the deep pockets," says the head of promotion at a independent label. "There's no way we can compete."

Consider this hypothetical situation: If a small label releases a single that becomes a runaway hit and is added to Top 40 stations across the country, almost overnight the fledgling record company would face a potentially fatal financial crush -- invoices for playlist adds from indies totaling nearly a quarter of a million dollars. Because of the established rules, even if the indies never even heard the song, let alone pitched it to programmers, the invoice would be sent out once the song was added to their stations. And if the label didn't pay promptly, indies could do their best to get the song yanked off the air.

So why do the major labels pay the extraordinary fees and vest so much power in outside sources like indies? That complex relationship has been forged over years. But the bottom line is the music business is wrapped in rampant insecurity and revolves around one simple, short-term question: Where is the next hit coming from? Period. And the strain internally at record companies to make those hits happen is immense.

"You have no idea what the pressure is like Tuesday at 3 o'clock, if you're VP of promotion at a label," says one person who has held that post at a major label. He's referring to the weekly ritual when radio stations inform labels -- and indies -- which new songs will be added to the playlist. Those adds will determine whether a song continues its rise up the charts, stalls or begins its descent. In a business built on perception, either of the latter two are considered the kiss of death.

If a single seems to be cooling, programmers nationwide often suddenly lose interest. Without airplay, the chances of CD sales diminish greatly. So labels are desperate to maintain momentum behind new songs, often at any cost. And the indies know it.

"How'd you like to have [Columbia Records president] Donnie Ienner in your office screaming at 3 o'clock on Tuesday?" asks the promotion veteran. "If you have to pay [an indie] $10,000 to shut your boss up, goddamn it, you pay, let me tell you. You're looking for every scrap of information to give you the edge or to give to your boss. And if Tri State [is] able to do that, and you have to pay a premium, so what? It's not your money."

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