The site Hypebot is running an excellent interview with Lee Parsons
, the CEO of Ditto Music, where he succinctly explains why new music distribution strategies will win (and are already winning), as well as why the major labels have failed so miserably to adapt. Here's a snippet:
Record companies cannot look into problems from a fresh, artist based angle. Problems are often solved but not in the way they were intended...
Shawn Fanning created Napster firstly for his own purpose. The new music models embrace as much technology and revolution as they can contain in a chaotic attempt to find a new and better path. Revolutionaries are prepared to make mistakes on the way; labels do not have this luxury. Many battles win a war, likewise through constant chaotic growth, development will come. Developing a new model for a major label is fuelled with risk so it is more likely they will continue to look for ways of containing technological advancement rather than embracing it as a new way of income....
The labels by being at war with the revolutionaries set themselves up as "The Bad Guy." Major label fat cats aren't going to convince a 9 yr old kid that sharing a song is wrong just because it affects their jobs.
People LOVE free music. Free music is always going to win.
By continuing with their argument instead of reaching out to new technology they push themselves even further behind in public opinion.
Unfortunately it isn't as simple as the "home taping will kill music" argument they thought it might be because the advancement of technology has overtaken even the revolutionaries' expectations. For a new generation of people music is now free. You CAN'T fight that.
You can't fight it, but you can embrace it. Unfortunately, as Parsons notes, the major labels, for the most part, are unable to embrace it because to them it still looks too risky. The problem for them, however, is that others are embracing it, and are willing to take the risks, and by the time "what works" is totally figured out, it'll likely be way too late for the majors to make the jump. Anyway, the whole interview is worth reading. Go check it out (and the link above is only for part I -- which has now been continued with part II