Early digital music boosters predicted that the Net could help increase that market share. Independent labels and artists have traditionally struggled with distribution, and the Net -- in theory -- allows any artist to reach a global fan base, they reasoned.
In practice, the Internet hasn't proven to be a magic bullet.
A handful of established artists have attempted to move outside the major label system by going online, trading on their offline popularity to draw Web audiences. Most prominently, Prince maintained his own Web store throughout much of his self-imposed exile from major label distribution. Although he's now back with Sony Music, his latest album is still available for download on his site.
Indie rock band Wilco temporarily distributed its 2002 album, "Yankee Hotel Foxtrot" on its own Web site after being dropped by its record label, only to be picked up by a related label a few months later.
Some underground artists have found fleeting success. DJ Danger Mouse's recent "Grey Album," a mash-up mixing Jay-Z's "Black Album" with The Beatles' "White Album," was distributed widely through blogs and Web sites after record label EMI Group blocked its commercial release, for example.
But the most popular artists in today's download services, and on the biggest Internet radio stations, are still Britney Spears, Outkast and other superstars from the offline world.
"The Internet is certainly a way of showcasing music in a larger venue," said Jupiter Research analyst Michael Gartenberg. "The question is getting it heard and getting people to pay for it."
To iTunes and beyond
Independent labels and artists are beginning to play an increasingly visible role in download services such as Apple's iTunes Music Store, where bragging rights to the largest collections of tracks -- including obscure independent songs -- are a critical selling point.
In large part, this growing indie presence is due to the services of a set of aggregators that serve as middlemen between the labels and the big online services such as iTunes and Napster. These companies, such as the Digital Rights Agency and the Independent Online Distribution Alliance, help small labels place their albums inside the music services, even helping them negotiate royalty rates that might otherwise be impossible.
