"This is the new frontier. This is the beginning of a new era for the music business," Flohr said.
Executives at the four major record labels would not comment on the record for this story. But several noted privately that their companies are still the best at artist development, promotion and physical distribution of their product - something even big acts can't entirely do without.
The four majors are Warner Music Group Corp., Vivendi's Universal Music Group, EMI Group PLC, and Sony BMG Music Entertainment, a joint venture of Sony Corp. and Bertelsmann AG. They accounted for more than 88 percent of all U.S. music album sales this year.
Still, some headliners are becoming convinced they have the clout to change the rules.
Madonna is said to be close to signing a recording and touring deal with concert promoter Live Nation Inc. after turning down an offer from her longtime label at Warner Music Group Corp.
Under terms of the new 10-year deal,! Madonna, 49, would receive a signing bonus of about $18 million and a roughly $17 million advance for each of three albums. Live Nation also would have to pay $50 million in cash and stock to promote each Madonna tour.
Warner Music just couldn't afford to pay that much to re-sign Madonna, Michael Savner, an analyst with Bank of America, said in a research note.
Meanwhile, Radiohead created a stir - and plenty of publicity - when the British rockers disclosed last week they would bypass signing a new deal with a record label and make their new album available online, letting fans decide how much they wanted to pay to download it.
Earlier this year, Paul McCartney signed with Hear Music, a startup label launched by coffee retailer Starbucks Corp. and Concord Music Group, rather than going to a major.
Even the Eagles are going it alone with their upcoming album, "Long Road Out of Eden." The group, which has sold more than 120 million albums worldwide, ! will release the album exclusively through Wal-Mart stores.
The trend had Nine Inch Nails frontman Trent Reznor exulting over being "free of any recording contract with any label" in a recent post on his Web site.
"I have been under recording contracts for 18 years and have watched the business radically mutate from one thing to something inherently very different, and it gives me great pleasure to be able to finally have a direct relationship with the audience as I see fit and appropriate," he wrote.
Music industry insiders say the bids for independence only make sense for the most popular acts or those with devout fans who fill concert seats, buy T-shirts and seek out their music.
"These artists are in the position to basically set their own rules and set their own course," said Ted Cohen, managing partner of media consulting firm Tag Strategic and a longtime record label executive.
Meanwhile, social-networking sites and Internet distribution are making it possible for lesser-known and unsigned bands to boost th! eir profiles and sell CDs.
"The game used to be really simple," Flohr said. "You get your record played on radio, you get your face on Rolling Stone (magazine), and you get on 'Saturday Night Live.'
"Now, it's you put your video on YouTube, you get your MySpace page happening, you do your deal with Facebook, you tour ... all these things add up, hopefully, to a successful record."
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Source: http://www.sacbee.com/954/story/429403.html
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