FCC Deals, Spitzer Squeals

The Federal Communications Commission is going behind New York Attorney General Eliot Spitzer’s back to secretly negotiate with music companies targeted in a “payola” probe, Spitzer charged April 3rd.

Clear Channel Communications, CBS Radio, Entercom Communications and Citadel Broadcasting are reportedly negotiating settlements with the FCC, according to ABCNews, which has been covering the issue on its “Primetime” news magazine.

Spitzer, speaking after an AFL-CIO event in New York City, said the government’s negotiation of settlement figures with the companies “would be a substantial evisceration of the negotiations we’re involved in.”

If reports of potential settlements with the FCC are accurate, Spitzer could have a point. A settlement offer of $500,000 reportedly made by Clear Channel was so low it was “laughable,” FCC and record industry sources told ABCNews.

Clear Channel reportedly upped the ante to $1 million when the half-mil was laughed off. Now, it is reportedly negotiating in the $1.5 million to $3 million range, a high-level FCC source told ABCNews. Entercom and Citadel have made offers of $1 million, the source said, while CBS Radio had yet to make an offer.

Andrew Levin, Clear Channel’s chief legal officer, confirmed a $1 million offer to the San Antonio Express-News and added he was cooperating and sharing information with both the FCC and Spitzer probes.

“We’re willing to pay a reasonable amount to put this matter behind us,” Levin told the paper. “We want to go back to focusing on our business and not on ancient history.”

Spitzer has targeted nine of the nation’s largest radio conglomerates in his probe of major artists and songs that he claims received air time because of payoffs by recording companies. He accused the FCC of being “asleep at the switch.”

Spitzer is also a Democratic candidate for governor of New York. He charges that instead of helping his case, the FCC – with a Republican majority among its commissioners – is actively working against him.

“We have asked them several times to participate and they have not only not done that, but they are now furtively going out there negotiating behind our backs,” he said.

“This is not the way government agencies should deal with each other, but it’s what I’ve come to expect from this FCC,” he said, adding that his office has shared all of its payola information with the feds.