This week, the FCC’s Enforcement Bureau entered into a Consent Decree with iHeartMedia to resolve its investigation into whether iHeart violated the FCC’s sponsorship identification rules. Interestingly, iHeart does not admit that it violated any rules, nor does the FCC suggest any specific conduct by iHeart violated any rule.  So why the Consent Decree?  The Decree say that it resolves an investigation into whether iHeart “violated the Commission’s sponsorship identification rules in connection with allegations that iHeart provided artists additional airplay on the Company’s radio stations in exchange for the artists’ performances at Company events, without the disclosure required under the Commission’s sponsorship identification laws.”  What is the disclosure that is required, and when is it required?  Again, the Decree does not make clear what identification would be required, nor does it say exactly what circumstances would trigger the requirement for a sponsorship identification.  So we have to look at the terms of the Decree itself to see if we can piece together exactly what is prohibited and when on-air sponsorship identifications are required. What we ultimately find is that the Decree really conveys a message that applies to broadcasters in many situations – when the station gets free or discounted “stuff” (whether it be a band’s appearance at a station event or free meals at a local restaurant) in exchange for something that is broadcast over the air, the audience needs to know that the airplay was sponsored.

The first place to look in trying to draw some specific guidance from this Decree is at its history.  The Decree stems from an Enforcement Advisory released by the Enforcement Bureau in February 2025, after Senator Blackburn from Tennessee alleged that bands had complained to her about some station practices in strongarming them into playing at station events for free or at reduced pay. The 2025 Advisory warned that any “deals” for bands to play at station events in exchange for more airplay, or any threats (express or implied) to reduce airplay if a band did not appear at an event, would be seen as a violation of the payola and sponsorship identification rules.  The Bureau referred to such threats as “covert manipulation of radio airplay.”  The Advisory states “[w]hen payola causes stations to broadcast programming based on their financial interests at the expense of community responsiveness, the practice is inconsistent with localism.” We wrote more about the Advisory when it was released, and included a broader discussion of the payola rules.