He is also buoyed by an independent music scene that is thriving, creatively.

"There's so many people making really interesting albums," he said. "Indie music has never been better. It's never been easier to find. There's a ton of great stuff out there and I think people are finding more and more diverse artists and they're priding themselves on the diversity of their tastes and are really searching for music. The primary orifices of exposure have changed. The big magazines, some of them are shutting down. MTV stopped playing music a decade ago, and radio isn't really a place to find new music. People are going to non-commercial radio stations, satellite radio, going heavily to the internet."

The changing business models have had a wide-ranging impact on fans, labels, artists, and would-be artists. The next generation of musicians will enter a world much different than when he started out.

"I think of a young musician growing up right now," he said. "The tools have been democratized. Anyone can make a record right now. You don't need special access. You still need some talent, but you don't need special access to the tools. Now that's been democratized."

All this democracy and the changing models might make it more difficult to become that "Next Big Thing," but Phillips doesn't see that as such a bad thing.

"There are more musicians making a modest living than their have been in a very long time and less musicians making it really big and I think that's absolutely fine," he said. "All that means is there's more exciting, good music out there.

"The filters are gone. It's what the record companies used to be. There were particular labels, whether it was Sub Pop or 4AD or Stax that you kind of count on. There was a thing that they did. It's often genre labels. That's worked out very well. Labels still will have some significance in that world and a few of the things affiliated with majors still have that- Nonesuch you know is going to be interesting and challenging. There are labels that can achieve that. Lost Highway has that as well."

While there are still a few labels that are offering up special records by artists that share a common bond, he sees himself stylistically in the company of some musicians who exist on the edge of a lot of radars because there isn't an easy label to describe their place on the musical landscape.