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The two biggest changes in music in the last ten years are the rise of digital distribution and the rise of digital production. In 1998 most records with any cultural impact (pop, jazz, classical, experimental, whatever) were recorded in professional recording studios and distributed on CD by record labels. Now, most music is recorded at home on computers at equal or better than 1998 studio quality and distributed through some form of the internet. Here are the stories:

Digital Distribution

In 1998, Napster, the first peer-to-peer file trading system to really take hold was just becoming popular on the college campuses. Using Napster entailed making a certain portion of your digital music library available for anyone to download and, in exchange, receiving free access to download everything anyone else had made available. The result was that all of a sudden an enormous library of music of all kinds — orders of magnitude larger than what you'd find in any real world record store — was made available for free with no effort to every college student. The major labels, and some bands (most notably Metallica), freaked out and sued the company out of existence (it has since turned out that the labels gave some consideration to making a licensing deal with Napster, which had planned all along to monetize their service, but they decided against it — a move that turned out to be a monumental mistake, as we'll soon see). Unlike the peer-to-peer technologies that succeeded it, Napster was centralized: each user's computer talked to one of Napster's servers to find out what was available. Napster's destruction made that technological model impossible and forced the users, who'd gotten a taste for free access to an infinite library of music, onto services with distributed architectures (Gnutella, Grokster, and, eventually, BitTorrent) which pretty much permanently eliminated the chance for a centrally-managed mandatorily-licensed service that would generally allow them to maintain their existing business model.

Enter Apple. In 2001, Apple introduced the iPod and iTunes. The original slogan for iTunes was "Rip. Mix. Burn." The idea was that the combination of iTunes and the iPod allowed you to transfer all of the digital music on CDs you'd purchased (mostly from the major labels, of course) and transfer them to be listened to on your computer, on burned copies for your friends, and, most importantly, on your iPod which you could take with you anywhere. One of the big effects of the iPod and iTunes (and, to a certain extent Napster, before them) was to accentuate the importance of the single over the album. In the world of digital music, the unit of currency is the individual file which corresponds to a song. And one of the most marketed ways to listen to an iPod was through its shuffle mode (allowing you a randomly programmed radio consisting only of your own favorite tracks).

In 2003, Apple released the iTunes Music store. You could now buy individual songs and full albums of major label music directly inside of iTunes, which more and more people were using to manage their music collections (mostly driven by the amazing strength of iPod sales). The catalog available on iTunes came from the major labels who, at first, didn't consider iTunes to be a serious business (Apple didn't consider it one either — the service was designed as a loss-leader for selling iPods). Apple sold all songs for the same price ($0.99) and included "Digital Rights Management" with each file — software designed to limit the user's ability to make an unlimited number of copies of the file and to use them on unapproved devices, such as iPod competitors. Much to Apple and the labels' surprise, the iTunes Music Store has turned out to be a runaway hit with 3 billion songs sold so far; Apple is the third biggest music retailer in America after Wal-Mart and Best Buy. As a result, the labels have become terrified of Apple's power and have started trying to create competitors so that they might get a better deal in the process (for example, they'd like to have variable pricing which would allow them to charge more for current popular singles and less for undesirable catalog and genre material, something Apple refuses) — thus the launch of the new Amazon MP3 store and a series of others. It's worth noting here that very little of the money paid for digital downloads makes it to the artists. The labels get about 70 percent of the purchase price and artists less than a penny (and that's a best case for major artists with the clout to audit their labels to ensure they're paid at all).

(One other major change to iTunes in the last few years has come from Portland business CD Baby. They are an enormously large online distributor for self-released CDs (they are the second biggest online retailer of CDs after Amazon). They managed to make a deal with Apple to license their entire catalog for inclusion in the iTunes store. So, now, an independent artist who wants to make their music available through iTunes can do so by submitting it to CD Baby. Other services, like Amazon's new MP3 store, have licensed the catalog as well.)

In the meantime, a series of increasingly popular social networks arose starting with Friendster and culminating with MySpace. These started out as basically dating sites but gradually became teen and twenty-something hangouts. MySpace, based in LA, was especially successful in luring small local and independent bands. Despite the site's terrible technical flaws (and the fact that it is now owned by Rupert Murdoch's News Corp.) it made it relatively easy for the technically un-savvy to get their music online in a form where other people could easily listen to it, engage them in conversation, and find out when their live shows were taking place. MySpace now hosts more than 3 million artists and has started a record label that draws from that pool. It is the coin of the realm of local music scenes around the country — club booking agents, local music press, other bands, all expect artists to have a MySpace page where their music can be heard. In the last few years, major label acts have started creating MySpace pages as well, which is a little like watching your parents sing along to Hip-Hop.

In the last few years, a new phenomenon has arisen: music blogs, as we discussed. They've managed to replace the print music press as the taste-makers and trend-setters for the most influential demographic: college students and music enthusiasts. The most recent news here is that the industry has begun figuring out how to market to these online music writers by leaking advanced songs off of upcoming records and otherwise flattering them with free stuff and attention. In fact, they've become so important to the labels promotion wings that the labels can't crush them for freely distributing their music (no matter how much they'd like to) for fear of a backlash.

The main upshot of these changes has been an ever increasing ability for independent artists to distribute and promote their music without the help of a major label (one side story I'm not going into here is the death of mainstream print journalism, MTV, and locally programmed pop radio, the main venues the major labels have traditionally used to make their acts popular); and for music fans to get access to major artists' work without needing to go through the labels. The labels have so far responded by trying to lock down their music with more and more restrictive DRM (and harsher deals with their online vendors), suing individual customers for downloading, and trying to re-negotiate their relationships with their artists so they get an ever greater chunk of the non-record sales parts of the business: concert tickets, publishing, and merchandise. The result has been a 30% drop in CD sales in the last year and an ever-growing flight of major artists away from labels towards alternative distribution mechanisms (like starting their own labels or working with major retailers (like Starbucks and Wal-Mart) directly). Though with the recent news of both Sony and Warner Music Group signing on to the Amazon MP3 store things may finally be starting to change both in terms of iTunes' dominance and the attitude of major labels towards DRM.

Digital Production

Since the introduction of ProTools in the early 90s, the ability to record, mix, and master music at a professional caliber has become ever more affordable, making its way from big expensive professional institutions to home hobbyist studios and finally to every laptop made today. With a normal consumer laptop, a couple of hundred dollars in microphones and conversion gear and/or software (depending if you're making music that requires outside-of-the-computer instruments or not), a talented recording artist can make recordings that are perfectly competitive with richly budgeted major studios (though not necessarily in the same style). This has lead to a number of new musical aesthetics arising from intimate parlour music (see also the work of Juana Molina to the pastiche of sampling (see The Gray Album by DJ Dangermouse — a mashup of the Beatles' White Album with Jay-Z's the Black Album is a paradigmatic example here and the first argument of most defenders of 'remix culture'). The prevalence of loop-based composition on the computer has also done a lot to spread the influence of dance music and hip-hop into all other genres (this year, in indie rock, nearly all of the big successful records are loop-based: Animal Collective's Strawberry Jam, Battles' Mirrored, Menomena's Friend and Foe, Bjork's Volta, Radiohead's In Rainbows, Girl Talk, etc. etc.).