There are all kinds of theories about the next business model for the music industry, most involving a combination of increased emphasis on live performance and much more widespread use of free digital sampling of music as a promotional device. Here is a guy who is living it:

Every two weeks or so, I pack up my Taylor acoustic guitar, fill my backpack with CDs of my music, and head down into the New York City subways to busk away. I make good money, and I get to watch and study people, too. For example, I can now tell from about 50 feet away whether a woman is likely to give me money.
If she's walking fast, wearing headphones, angrily porting a briefcase, or chasing down one of her children, that's an easy no. She wouldn't throw a dime into Jimi Hendrix's case. Other women, who are more aware of their surroundings, have greater possibility. Usually it boils down to makeup and midriffs. If the woman is decked out, she may look at me, but only to see if I'm looking at her. But if a woman is dressed casually, walking slowly, and thinking about something beside herself, she's likely to listen for at least a few moments, and then I have a decent chance she'll enjoy the music, stop, and maybe buy an album.

This is but one of the lessons I've learned from performing in train stations that I think could be helpful to the floundering music industry, or at least to the many talented musicians stifled by it.

....Whatever the reason, it's clear that the music industry's old model of doing business isn't working so well in today's market. That old model relied on labels plucking out a handful of bands they believed would sell big, and investing millions of dollars in production, promotion, and marketing to get them the time on the radio dial or the space in the record stores they required to catch fire. The industry defended itself against complaints by saying they were simply meeting the demands of popular taste.

In truth, there was always a tautological element to this argument. The music industry functions like a cartel, and the public's preferences have always been limited by the choices they were given. Now that the market for music has changed, and CD sales are declining, the record industry is hiring lawyers and lobbyists to squelch the new technologies that are changing the music business.

....When I first started playing in the subways, I experimented with different prices for my albums: $2, $5, $8, $10. I sold slightly more CDs at $2, but far fewer at $8 or $10. The sweet spot seemed to be a price of $5. ... This could merely be the measure of what my music is worth. But my strong sense is that five dollars is what people will pay for a CD they like by a musician that they've never heard of.

....One might think that my only audience would be the Birkenstock nature-lovers and 14-year-old kids porting around their first guitars--and I do do well with that crowd. But I also do well with middle-aged black couples, 40-year-old white couples with kids, white blue-collar workers, and the Ecuadorian immigrants who sell jewelry in my favorite station. In fact, I have a much better chance of telling whether someone will like the music based on the way that they walk than based on their age, sex, or apparent income.

page 1 | 2