Promoters Hurt by Record Industry’s Reaction to Probe

Independent record promoters say they are reeling in the economic aftermath of the major U.S. record companies’ decisions last week to cut back or eliminate the use of outside help to get their records played by radio stations.

The record companies’ action came within days of an “NBC Nightly News” report linking two prominent independent promoters with alleged East Coast Mafia figures. However, other independent promoters--of which there are an estimated 200 across the country--say they now are facing economic ruin.

“We’re getting destroyed,” said Cliff Gorov, partner in Dudley-Gorov Organization of Hollywood, a long-time independent promotion company.

According to Gorov, his firm’s business has dropped more than 60% since the record companies began announcing their withdrawals from independent promotion. “Last week we were working seven records, this week we have two, with nothing in the future.”

Layoffs Likely

Gorov said he has told his six staffers that “I’m going to observe what happens over the next few days and if nothing changes by next Friday I’ll have to let you go. There’s nothing else I can do.”

“I’m one phone call away from being completely out of business; I’m waiting to hear from my last remaining account,” said another Los Angeles promoter, who asked not to be identified.

“I don’t have a single record I’m working right now,” said Houston-based Bill Cook, a 20-year veteran of independent promotion. “I can’t even feed my family. I don’t know what the answer is, but it doesn’t look like there’s a future in this business.”

Among the hardest hit is Joe Isgro, who on Friday closed up his opulent Hollywood office and laid off a staff of 30. “My business is lost, it’s history; no matter what happens, I’ll never be able to rebuild it,” Isgro said in an interview.

It was Isgro’s alleged meeting with several reputed Mafia figures last month at a New York hotel that started the record companies’ stampede to disassociate themselves from independent promoters--after years of increasingly expensive dependence on them.

Federal Investigators

Videotape footage of Isgro’s alleged meeting was included in the NBC report, along with allegations that federal investigators were looking into possible Mafia connections to a resurgence of payola.

Other promoters say the record companies’ dramatic reaction has harmed their profession.

“There’s no question it’s a baby-with-the-bathwater situation, and a lot of innocent people are getting hurt,” Cook said.

“The record companies seem to be lumping us all together based on allegations against a very few,” Gorov said. “They know who the bad guys are, so I can’t understand why they aren’t differentiating among us.”

Record companies traditionally have employed independent promoters to augment the efforts of their own marketing and promotion staffs. In recent years, the use of independents has increased as the record companies--reacting to economic downturns in the industry--cut back their promotional staffs.

Gorov says most legitimate promoters work for fixed sums sometimes as low as a few hundred dollars a week per record. However, a few--estimated to be no more than a dozen--have come to dominate the industry and reportedly receive up to $200,000 per record because of their proven ability to deliver widespread air play on key top 40 radio stations.

Those promoters are also paid bonuses for getting records played on certain key stations that report their play lists to industry trade publications.

“The record companies and the radio stations know that most of us are clean and above reproach--we do an honest day’s work for an honest day’s pay,” Gorov said. “Everyone who loves this business is glad that there is an investigation going on and if any improprieties are found they hope it will be cleaned up,” he said. “But in the meantime, all my people and myself could be put out of business.”

Federal investigators have told The Times that the investigation into practices of some promoters is in the very early stages and so far has not revealed any evidence of widespread payola practices.

“Which is not to say it’s not going on,” said one Justice Department official.

Asked if he expected any indictments or arrests in the near future, one official replied, “I wouldn’t hold my breath.”