Music Industry Embracing Digital Revolution

Aug. 18 - KGO (KGO) -- The digital revolution empowering music fans to download music for free over the internet triggered a series of lawsuits, pitting artists and record labels against consumers. Yet the digital revolution continues. And so do the battles.

They're mostly young, tech savvy, and forward thinking. As much as they have in common, they are at odds over the future of music and technology. The battle lines were quickly drawn when fans started sharing music over the internet.

Darryl Taruc, Hayward resident: "If they can find a cheaper way to download this music, and free is as cheap as they come, they'll do it."

There seems to be a sense that the division between music fans and the artists is closing, for the better. Terry McBride runs a record label and manages a stable of artists, including Sarah McLachlan, who have sold 100 million albums.

Terry McBride, Nettwerk Music Group CEO: "Artists now see the net as a good thing. They don't see it taking away their sales. They see all these kids that are file sharing as actually music fans that will market and promote their music, versus kids that are just stealing the music."

Today's music fans aren't just talking about their favorite artists. They have a profit motive now. For example, San Francisco based good storm lets bloggers sell albums for sale on website the albums of artists they're writing about. The blogger gets a 50 percent commission.

Another way to get artists and young fans on the same page.

The future of radio is another challenge created by the digital revolution. Competition from satellite radio and internet radio has cost AM and FM stations three to four percent of their audience.

David Louie, San Francisco: "The one question people can't seem to answer is how long will this technological warfare continue? It may depend on how deep the players' pockets are. In the case of satellite radio, the two major services have burned up $5 billion in the paste five years and haven't turned a profit. "

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