The traditional music business, built around the sale of fixed music recordings, handles manufacturing, packaging and distributing, middlemen selling something they didn't make themselves, something never really theirs to begin with. These days, though, tech is trashing that model, by fits and starts turning the business of music from a product-based market into something more like a social media service directly connecting artists and listeners. As I noted in my conversation with composer Bob Ostertag, artists are wrestling with the new tools, using the freedom the Internet provides to bypass the middlemen entirely and using sales platforms like Apple's ( AAPL) iTunes, and CDBaby, social media audio-exchange services like SoundCloud and Internet radio pioneers like Pandora ( P) and Spotify to reach greater numbers of potential listeners. While recordings are still the primary currency of these artists, more and more are emphasizing the recordings as calling cards, samples of the more true, live experience.
Even now, the major labels can really market only the biggest draws, the acts competing for the top spots on Billboard's charts. Anything that can't sell hundreds of thousands of albums is not on their radar. Funding for the development of artists, for tours, for studio costs -- all of that is long gone. The music business will probably rebound from the current rout and reestablish a new role for middle men, but only after the landscape has settled and the new technologies have become common currency. Small labels that will add value to the experience through artist development will spring up, using the same distribution technologies as the artists themselves. Virtual media technology will continue to improve, allowing even closer representations of the live music experience. In the meantime, companies that don't necessarily represent artists but are, instead, working to expand the direct relationship between artist and listener are the surest bet for the future of the business. -- Written by Carlton Wilkinson in Asbury Park, N.J.