Public outrage greeted the payola scandal in the 1950s when people learned that payoffs in cash, not the public's listening tastes, determined what records disk jockeys played on the radio. It is a measure of change in the country that a new form of payola, quite possibly legal, draws yawns and comments that that's just the way the record business is. It needn't be, and the allegations that smack of a corruption of the marketplace should be of concern in California--one of the recording centers of the nation.
The way it's done now, according to Times staff writer William K. Knoedelseder Jr., is that record companies pay independent promoters to win increased air time for their products. The promoters then pay consultants' fees to radio program directors. The suspicion is that the fees influence the selection of records that go onto the air.
A federal grand jury in Los Angeles is looking into the practice. Individuals who are involved in the operation say that they funneled at least $1 million to a group of program directors between 1981 and 1985. One promoter said that he was paying 15 to 20 program directors anywhere from $10,000 to $30,000 a year. Since radio programmers, unlike programmers in television, are not paid lavish salaries, the temptations are great. Taking the money may not be illegal, which just shows again how hard it is to legislate ethics. The law written 27 years ago doesn't prohibit taking money in exchange for playing a record. It just says that the public must be told that money changed hands. So the record industry's definition of payola has been limited to offering a specific amount of money to play a specific record. "Anything else is legitimate promotion," one source said.