In the ever-evolving (despite the efforts of RIAA) music industry, I find TuneCore very interesting. They have a fee-based music distribution system, under which an artist pays a fee and can have their single sold through iTunes, Rhapsody, etc. One of TuneCore’s most striking offerings is a flat $10 fee to distribute a song to 11 online music stores. The potentially transformative effect of this service should be obvious; not only does this service reinforce the move back toward the single and away from the album, but it also takes on some of the marketing and promotion function of the record label. If your primary market channel is live gigs and word of mouth, this distribution model may be more profitable for you than the traditional record label route.
Now they are starting up a service by which musicians can earn money by driving traffic to sponsor web sites.
Artists can promote free songs at their web sites, encouraging fans to visit the corporate sponsor to download the songs. It’s up to the band to decide how they want to promote that link and get people to those sites whether by displaying an adbox or in-blog links. Once at the site, users will interact with that web page to generate their download code, likely being polled at least for their e-mail address. The traffic fees will be split between the musicians, based on the number of downloads generated. More fans means more downloads, which means more money for the band in the end. It’s basically a way to monetize fame outside the traditional boundaries of record labels.
The whole Ars Technica article is well worth reading, because it’s full of insights about the connection between social networking and the production and distribution of creative work.