Major record labels are the venture capitalists of the music world. They invest large amounts of capital in a small number of artists, hoping for big hits that

Major record labels are the venture capitalists of the music world. They invest large amounts of capital in a small number of artists, hoping for big hits that are highly profitable. Most aren't, so they're savagely dumped. Worse, unlike venture capital, record labels insist on control over the reproduction rights of the music they fund, so artists lose control over their own work. It's a really crappy deal for musicians, unless they're one of the lucky handful who go platinum. When these articles talk about "the music industry", they're really talking about the major labels. They're getting beaten up, and for good reason. It's not piracy - it's distribution costs, which are converging on zero due to Internet technology. The labels were needed when it was an incredibly expensive and difficult proposition to put copies of a record in thousands of record stores. Today, artists can just put their music out on the cloud basically for free, and pay a very reasonable and competitive fee on download costs and payment processing from the likes of iTunes, CDBaby, Bandcamp, and others. At this point, what are the major labels bringing to the table? Their increasingly irrelevant marketing prowness? Their marketing was based heavily on de-risking due to the investment expense (which is why the major labels pushed so much tame, crappy music - it was safe). That's exactly the opposite of what many musicians need! So yeah. Musicians are doing fine. It's not as easy to get filthy rich now, but it's a lot easier to make a decent living doing what they love, without compromise. As for the major labels? Don't let the door hit you on the way out.