Roger McGuinn on MP3.com
Is it really this simple?
This story from DaveNet tells of Roger McGuinn's (of the 60's group "The Byrds") experience in the recording industry. Briefly, he has recorded 15-20 albums in the traditional recording industry way in the last 40 years and made little or no money in royalties. He has recently put some recordings on mp3.com and has made thousands of dollars.

From fairly consistant second-hand stories, bands who are signed tend to receive little money in way of royalties, but have huge budgets for recording albums, have much larger fan bases, and have better funded/promoted tours. And all the hassle of running the finances of the band are out of their hands.

It seems there are ways to make money in this industry fairly easily (via 50% royalty contracts on mp3.com for example), but at the cost of album quality and smaller audiences. The shift is moving toward downloading music... and people will forget they want glossy covers on their CDs. Is this a good thing?

Notes on Napster
Lets hope this subject never dies
Doc Searls has a nice long rant about Napster..

Thanks to Dave for sniffing these interesting stories out.