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When I was music director at KAOS in Olympia, we had this long standing 80% independent music policy. I was never too into it, because I maintained that Brian Eno makes better music than NOFX, and no label cred was going to change that.
However, the way that station, which at least at the time was often consider the voice of what indie was, defined indie was that a label could not have any support whatsoever from the big three (which has actually expanded slightly to Sony BMG, WEA (Warner/Elektra/Atlantic), EMI, and the Universal Music Group since).
If a cd or record was major we put red electrical tape on the spine. If it was indie, we put green on it. When Sub Pop sold 50% of it's shares to WEA, it went red tape even though it was started by Bruce Pavitt as a radio show on KAOS. Matador was owned by Atlantic at the time, so it got red tape too, but since then that relationship ended and Matador is considered all the way indie again.
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