How do radio stations work? Who pays whom?

In most countries, radio stations do have to pay artists, music publishers and record labels to play their songs. In the UK, the fees for this are around 8-10% of total radio station revenues, depending on the size of station. In the US, the figure is more like 2 or 3%, since a different historical deal was done with the record labels (a deal which they're trying to change). Artists don't pay radio stations to play their songs. Record companies do, however, reward radio stations for playing their new artists: for example, a big interview with an established artist might only be given to a radio station that plays one of the label's favoured new, upcoming artists.

The vast majority of commercial radio revenue comes from advertising revenue. In the US, public radio stations are funded by listeners and corporation underwriting. In Europe, some radio stations are run by public-service broadcasters who either get a grant from the government (like in Ireland) or revenue from a government-mandated licence-fee (like the BBC in the UK, or ORF in Austria). Many European public-service broadcasters also carry commercials.

Most radio stations are thinly staffed: some, like JACK fm stations across the world, may only have one or two presenters, leaving the rest to automated playout. Others, particularly public radio, are more generously staffed to reflect the more complex output.