A fascinating article in The Economist called The Music Industry — From Major to Minor opens with this paragraph:
Woah.... Y'r business plan is toast, man.
The music industry has basically committed suicide. Sure enough, the business arrangement they gravitated to, involving a few large record companies, A&R people with focus groups, unfair contracts with musicians, a few large companies owning hundreds of radio stations, payola, playlists, retail stores with high prices and limited stock, the whole shebang, makes for an unsupportable industry.
It sounds bad, but it's not really. In fact, it's very good news. It means that the elements of mediocrity are in free fall and that there's a huge opening for an entirely new music business based on a more artistically favorable core. If anything, now is the time for the new music entrepreneurs.
Don't believe me? Okay, note that Apple's iTunes is currently the fourth largest retailer in the country. And note that iTunes didn't exist before 2001.
Also do check out this delightful article in Wired called David Byrne's Survival Strategies for Emerging Artists — and Megastars Which includes interviews with Brian Eno and Thom Yorke. The opening paragraph is here:
These are going to be very interesting times for entrepreours in the music industry.