Is this the day the music died?

Meanwhile, social-networking sites and Internet distribution are making it possible for lesser-known and unsigned bands to boost their 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.”

Some established major acts are using the same tactics as their new albums post lackluster sales but their concert tours keep selling out.

The strategy doesn’t help record companies. The industry has seen a 14 percent drop in the number of CDs sold in the U.S. compared with the same time last year, according to Nielsen SoundScan.

Sales of digital tracks online are up 46 percent over the same period, but have yet to offset the industry’s losses during the past decade.

To adapt, the major labels are trying to cut deals with artists that go beyond album sales and encompass income from concert tickets, T-shirts, music publishing and other sources.

New acts need old labels to break into industry
New bands with their eyes on superstardom still need the deep pockets of the major labels to pay for the promotion, marketing and distribution necessary to get heard above the din of countless other acts.

Even superstars can use the boost.

Take Prince. Famous for scribbling “slave” on his cheek during a bitter dispute with Warner Bros. Records in the early 1990s, he has released most of his music over the Internet during the past 10 years while striking CD distribution and marketing deals with different major labels to get copies of his albums in stores.

Radiohead has said they want to get their latest album in stores in a few months and are said to be shopping for a possible major label distribution deal, if not a multiple album contract.

And it’s widely expected that Live Nation will have to strike a distribution deal with an established label to handle promotion and get Madonna’s upcoming albums in stores.

In theory, that could lead Live Nation back to Warner Music, home of Warner Bros. Records, where Madonna signed as a new artist in 1984.

“It comes down to, do you need a label? Possibly not. Do you need the expertise that a label traditionally brought? Absolutely,” Cohen said.

Despite the turmoil in the industry, the major record companies continue to exert considerable influence in the marketplace.

Major labels are not likely to disappear or become irrelevant, although the role they play might change as digital music overtakes CDs and other physical formats, Flohr said.

“I don’t think this is the death of anything,” Flohr said. “I actually think this is the rebirth of all of us.”

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