My most recent article for The Industry Standard just went up – How MySpace Music could beat iTunes. If you’re interested, please give it a read!

The music industry is something that I’m really thinking about lately with the launch of Fat J Records and signing Cara Austin – so the recent news about iTunes overtaking Wal-Mart and MySpace Music’s launch are both of great interest to me. And there are a lot of things about the MySpace vs. iTunes topic that I didn’t have space to include in my article for The Standard. So I thought I would just list them here, kind-of stream-of-thought.

MySpace Music can beat iTunes by supporting musicians. This is the premise of the article that I wrote for The Standard. Basically, I think that if MySpace Music provides data about the fans that purchase music, ticket and merchandise to the musicians, it can beat iTunes. Go read the article for the whole argument.

CDBaby is a model of how MySpace Music could work. CDBaby is an unbelievable music retailer that caters only to independent artists. And this is what its privacy policy says (these points are directed at buyers who visit the site):

“Only the musician whose music you buy will know who you are. If you don’t even want the musician to know about you, just say so at the bottom of your order form.”

I use CDBaby to sell CDs for Cara Austin, and so far, NOT ONE person has requested that CDBaby withhold their contact information. This is because people who go so far as to buy a CD are usually fans - and they don’t mind the band or artist being able to contact them again in the future.  According to the company’s Website, CDBaby has sold 4,202,465 CDs to customers resulting in $71,482,212 paid directly to the artists.

iTunes is a store, MySpace is a community. I read this quote from someone involved in the deal, and this is a really important point. While there are millions of people who buy music from iTunes, the MySpace community that uses MySpace to discover new artists and read about what they are up to, will be a powerful environment for making a purchase. With the possibility of revenue coming from MySpace, artists will do even more to make sure that their pages are attractive, interesting and compelling. And the community of music on that site is going to get stronger and stronger. Imagine 5 million musicians adding content, video, new songs and new song versions - this is going to be incredibly powerful and impossible for iTunes to rival.

Facebook’s chance to win in this space is shrinking by the minute. Facebook is gaining on MySpace in the social networking space, but Facebook’s support of music is, well, pathetic. They are going to have one shot to try to release a music platform that users will like (and use) but it’s not looking good. With MySpace’s announcement of the support of three of the four major labels, one possibility is that Facebook already has the support of the fourth (but that is highly unlikely and just speculative on my part).

International will be huge. I read that MySpace Music isn’t going to be able to distribute music internationally yet. What? What is the licensing issue with that? My suggestion – sign up all the indies asap and start selling to Japan, England, Australia, and everywhere else that has an appetite for U.S. music immediately – or else that could be a place that MySpace Music will be vulnerable.

DRM free matters, but won’t be the thing that wins it for MySpace. As part of the announcement, MySpace announced that they music that is sold from its music store will be DRM-free. (DRM=Digital Rights Management, it is the protection that Apple places on its files that prevents people from being able to share them.) This is a big deal, but not the biggest, as this will just (finally) compel Apple to follow suit with iTunes.

There is still a perception issue that could cause MySpace some serious problems. MySpace has kind of a seedy image. The site’s design is fairly unattractive, and it’s hard to navigate the social network without running into something that borders on pornography or spam. The company is going to have to do battle against that perception to win back people who have become disillusioned by previous negative experiences with MySpace.

Can Apple prevent iPods from using this service? Technically, I’m not sure if there is a way for Apple to limit the sites from which the iPod can download music, but if users are unable to load music from MySpace Music to their iPods, that would be a serious setback to MySpace. It also would likely cause a revolt among iPod users against Apple, but it would still be a hiccup in the acceptance of the service.

I have written about my friend Cara a number of times in the past, and today I am proud to annouce the launch of her new CD and Website. The CD - Send Me - is available for download or purchase at all the standard musical locations - Amazon.com, iTunes, Rhapsody, and CDBaby - but it SOLD OUT in the first day from Amazon, so they are waiting to get some more copies in and are temporarily out of stock.

I highly recommend that you check out these tunes - you’ll hear interesting lyrics, a great message that gets into your head and your soul, and I am constantly impressed with her songwriting skills.

Cara is one of the people who I admire most in the world - this is someone who everyone will want to get to know, check it out.

In a recent article, I made a series of predictions about the future of the music industry - one of those predictions was that “many new online and digital services will rise and fall.” Now that I think about it a bit more, that prediction seems kind of cheap because in the course of researching that story, I came across lots of the new online and digital services that have already risen. So half of the prediction was more just reporting than prophesying.

Even so, I thought it might be helpful to include a list of the new music models that I found while doing the research. If my prediction holds, many of these will eventually fail, and most of the others will be acquired or consolidate. Staying on top of this quickly changing industry will be tough for awhile, but knowing what’s out there now is a good place to start.

This list is obviously not exhaustive, so if you know of others, or have feedback on any of those listed below, please leave a comment. Also, some of these companies have revenue models that are clear, but others were a bit less so. If you have any input, let me know.

Goombah - Music recommendations based on your iTunes playlist and a comparison of what other people who share similar music interests are listening to. Goombah scans your iTunes library, finds other people who share your musical tastes, and then recommends songs to you based on the songs that they listen to. Revenue model: Affiliate income with potential to get into paid placement, with labels paying for their artists music to be part of the recommendations.

finetune- This site lets you type in an artist and they will createa custom playlist of songs based on that artist and others “like” them. Alternately, you can build your own playlist of up to 45 songs from 15 artists. You can then take your custom playlist and embed it on your blog or MySpace page. Revenue model: advertiser-supported

Groove Mobile - The leading music-for-your-cellphone provider, they have mobile downloads, P2P sharing, music recommendations, streaming radio and music subscriptions. Groove Mobile also powers Orange’s Music Player (U.K.) and the Sprint Music Store. Revenue model: Subscriptions

Livewire Musician - This Web application lets bands, labels or managers book gigs and tours, communicate with fans, manage radio promotions, manage the press, and track radio play. A basic account is free, and there are a la carte premium services available. Revenue model: Licensing fees

matchmine - Suggests other songs (and movies and blogs) that you‘ll be interested in based on your preferences. The company is a product of The Kraft Group/New England Patriot’s interactive media and innovation team. Revenue model: Sells general user data to partners

Nextcat - Social networking for the entertainment industry, which in the entertainment industry looks more like traditional networking. Revenue model: Advertising and sponsored listings and placements

nimbit - Business management tools for the indie musician. The company’s mission is “to put musical artists in complete control of their own music business and brand, enabling them to reach their full potential as quickly as possible.” They do this by providing solutions that allow artists to sell CDs and digital downloads, merchandise, and provides assistance with online ticket sales, e-mail list management, Website design and content hosting and a variety of other services. Revenue model: Paid services

OurStage - This site works kind of like a traditional “battle of the bands.” Bands upload their music, users of the site vote on what they like the best. Every month there are winners of cash prizes. Revenue model: The site sells the music that is uploaded to the site.

Sonicbids - Connecting bands and music promoters. The site allows musicians to put together one digital press kit (DPK) that is then distributed to promoters and helps the artists book gigs without having to send out physical press kits. Revenue model: Promoters pay a one-time fee and artists pay for submissions.

Amie Street  - This site allows indie artists to upload their music - the more popular the song, the more expensive it is to download. All songs are free to start and then move up in cost the more popular that they get. When users recommend songs to their friends, they get credit to buy more music. Revenue model: Earn 30% of every song sold

Strayform - Artists put proposals online and they are (or aren’t) funded by the fans who see them. According to Strayform, “Fan funded proposals let artist get paid without giving up a big cut, without blowing money on ads, and without long term restrictive contracts.” All the media is Creative Commons licenced, so fans can use everything freely on any device and share on P2P networks. Revenue model: ?

SellaBand - With this site, musicians need to find 5,000 people who “believe in them” (people prove this by giving $10 to the artist) and then SellaBand takes the artist to the “best producers and studios in town.” Then the three (artist, believer and SellaBand) split the profits from sales of $.50 downloads. According to this article from TechCrunch, some artists have hit the $50,000 mark and have already headed to the studios. Revenue model: Splits revenue with the artist and users

CDBaby - Online record store that sells albums by independent musicians. They only sell music that comes direct from musicians, and pay the musicians directly, weekly. They also help to facilitate the digital distribution of music. Revenue model: They take $4 per CD sold, plus an initial $35 fee.

iTunes - This is a site that probably needs very little introduction. MP3 library, from which users can download songs for $.99 per track, $9.99 per digital album. Revenue model: iTunes takes 30% of each sale.

Amazon MP3 Downloads- Works just about the same way that iTunes does, except that users don’t have to download a special player to get songs, and digital albums cost $8.99 each. Revenue model: Amazon takes a percentage of each sale

Rhapsody- Another MP3 download site, this one features unlimited downloads based on various subscription deals. Revenue model: Memberships plans starting at $12.99 per month

TuneCore- This site allows artists to upload their digital tracks, and then TuneCore manages their relationships with digital distributors, including iTunes, Amazon.com and Rhapsody. I wrote a more in-depth assessment of the site here. Revenue model: Charge artists a yearly fee

In compiling this list, I relied heavily on TechCrunch and Xconomy. Thanks!