Now fans call the tune

If you stroll down to the newest store on the Third Street Promenade in Santa Monica, you will find an elaborate mobile in the front window that spins gently as customers and the coastal breeze come through the door.

Revolving on the arms of that mobile are album covers that suggest a music boutique with a zeal for the eclectic -- there’s the Who, Willie Nelson, the Ramones, Marvin Gaye, 50 Cent, the Flaming Lips and dozens of others. Inside, though, you will find no CDs, much less vinyl, and with a bit of romantic license, you could imagine it’s the winds of revolution that make those album covers dance.

The shop is the new Apple Store, and in its sleek interior you will find the computer company’s hardware as well as assorted gear and software. The albums in the front window are essentially an advertisement for a music store that exists only in the digital ether of the Internet and sells songs for 99 cents apiece. It’s called iTunes, which you may or may not know firsthand but probably have at least heard about via a series of engaging television commercials with bubbly fans singing their favorite hits.

In a music world in upheaval, iTunes, with its paid downloads of music, is the closest thing to an interim government in the lawless land created by Napster and its revolutionary ilk, and while its future is uncertain there is no denying that the real estate on Third Street in Santa Monica is a foothold in a brash new world.

The sunny visions of those Apple commercials are hard to reconcile with the gloom and doom that have been pervasive in the music industry in recent years. The grim chorus is now as familiar to the public as any Top 40 hit: Piracy has gutted profits, CD sales are going steadily south for the first time since the format was introduced in the 1980s, corporate conglomeration has stultified any art in the commerce of record labels, radio and the concert business.

All of that is true, and in private even the titans of the business express fears that probably echo the anxious mutterings of railroad barons in the days when Model Ts began rolling down the line. But here is the funny thing lost in the histrionics: Today may be the very best time to be a music fan, especially one looking for a connection to a favorite artist or guidance and access to the exotic or rare.

Be it the iPod (the popular Apple portable digital player), alluring satellite radio services such as XM, the fan-beloved minutiae posted on Web sites, the availability of live music performances on AOL, the esoteric music videos streaming off Launch.com or the self-tailored satisfaction of burning a homemade mix on CD at home, there is a singular zest to the modern fan experience today.

All that has been flummoxing to the formal music industry, which has little control or obvious major profit source in any of the above. Mainly because, in the past five years, the experience of being a music consumer has been increasingly determined by that consumer, not the artist or the industry.

The impact of the CD

The big screen has a map of the United States and, with a click of a mouse, it is filled with red dots, more than 50,000 of them, spread through every state but clustered in metropolitan areas like hot spots on a thermal chart. The dots represent music fans, mostly teens, mostly male, and they are part of a curious and potent community that finds its hub at the Web site of StreetWise Concepts & Culture. StreetWise uses the members to market and promote bands, new films, video games and anything else that skews toward youth, and the members in turn get cool merchandise, backstage passes and, most interestingly, a big say in the shaping of products and projects before they reach the public.

The company is the brainchild of David “Beno” Benveniste, also the manager for System of a Down. The early grass-roots promotion of that band led to the StreetWise model, but now the company has been contracted to use the same “viral” approach for Radiohead, Nokia, Coca-Cola, NASCAR and many others. The lifestyle and wants of the new music fan may be a riddle to major record companies, but they are the basic programming at StreetWise.

“Look, the kids are so smart these days, they can find, retrieve, disseminate, produce any piece of music or technology now on the Internet. They can take a song, send it to a friend in North Africa, remix it how they want, make their own video for it and make it their own. And that technology makes them so powerful. It’s not about the radio programmers anymore or promoters. It’s about a kid in homeroom in Iowa now. Everything is different now.”

Still, the currency of the music industry remains the compact disc, and that is a problem. Sales of the CD are down 20% since 2000 and a major comeback is as likely as a boom in Laserdisc sales. In a wry twist, the CD itself is one major reason the business finds itself in dire straits today. The embracing of that format in the 1980s sparked a huge boom in profits as the digital quality and durability of the silvery discs inspired many consumers to replace their vinyl collections.

The windfall made the business more attractive to multinational conglomerates and led to huge investment. As profits waned, though, consolidation and a more strident corporate ethos pervaded. The “art” of music would now, more than ever, have to pay off on a quarterly basis. That set the stage for crisis when consumers, who have long complained about the price of albums, abruptly found MP3 computer technology in the late 1990s, an avenue for snatching any song they wanted for free. File sharing, via Napster and similar services, created a new model that the industry has yet to figure out.

The chaos inspires in some a belief that better times are ahead, not just for fans but also for artists and the business thinkers willing to jettison the view that giving away music is tantamount to condoning high-tech shoplifting. One of those thinkers is Benveniste. While many in the music industry have been scrambling to halt file sharing (indeed, the Recording Industry Assn. of America is now pursuing hundreds of subpoenas that would force Internet service providers to reveal the names of particularly prolific online music bandits), Benveniste exults in mailing out free music to fans and creating as much Internet buzz as possible.

“The record companies had been way up in the air, far away, and they don’t have tentacles down into the street, down into the boiling area below,” he said. “Look, you can either fight all this -- and lose -- or realize that if you have a band that is blowing up with kids online, you will find ways to make money.”

A consumer revolution

Revolutions are nothing new. In the 1950s, the rebellion was in the sound of rock ‘n’ roll, in its swagger and raunchy swivel, and in the 1960s the lyrics reflected and shaped youth culture, fashion and politics. The 1970s had punk and disco skirmishing with big-money rock, while the 1980s saw the rise of hip-hop, music that waged (and won) a street fight against the music industry status quo.

By the end of the 1990s the new revolution, for the first time, wasn’t in the music itself but in the medium -- and for the first time the consumer called the tune.

The result is a sea change in how consumers can shape their music experience beyond radio and buying recorded albums. Take the iPod -- by taking songs off of CDs or from the many Internet sources (where the vast majority of song trafficking remains unsanctioned) and transferring them to a computer and then the iPod, music fans can walk around with thousands of high-quality songs and create mobile soundtracks for their lives.

Among them is Alan Price. He’s 41, works in sales in the aviation industry, lives in downtown Los Angeles and for a year and a half has carried an iPod as religiously as his car keys and wallet. The 383 songs it holds range from the luminous pop of the Alan Parsons Project to the Swedish death metal of Dark Tranquillity.

“Look at it, it’s pretty scarred,” he says, holding up the small, hard plastic device, which is roughly the size of a television remote control. “It goes where I go. I listen to it driving, when out, when I travel, everywhere.”

Price now abhors commercial radio and constantly scours the Internet on a sort of musical safari to find the next underground sound to add to his portable archive. He can’t remember the last CD he bought, and that makes him part of the music industry’s problem. After years of paying for CDs that had only one or two good tracks, he feels less than guilty about his collection.

The iPod has also had an impact on his longtime relationship with music. “I have never been more active in finding something new I like,” he says. “I’m constantly changing my collection, constantly finding something new. It’s not like radio, where they play the same 10 songs over and over.”

The “gee whiz” factor of the iPod is matched on other frontiers. Take XM Satellite Radio, whose 101 digital channels might be simultaneously playing Bing Crosby, the Roots, the Jam, a Jerry Seinfeld stand-up performance and several BBC broadcasts. There’s also Launch.com, where hundreds of videos are ready to be watched, including fare by Venus Hum, Rascal Flatts and a legion of others you won’t see on the “TRL Live” stage at MTV studios.

Then there’s the massive world of Web sites devoted to artists, set up by the musicians, their record labels or their fans. Whether you are a devotee of Beyonce or a fan of Fatboy Slim, you can track down a boggling amount of biographical data, engage in chats and hear streaming live performances. There is plenty of cyberspace for the esoteric too. Take the band Ween, for instance. The quirky rock duo’s Web site plays concert recordings from the band 24 hours a day, shares their backstage photos, and lets fans vote on what songs the duo should perform in online performances. “It’s great, I guess, because it gives the fan as much as they could possibly want,” says the group’s Gene Ween. “But there is something to be said for mystery, too, you know. There’s not a lot of mystery today.”

Artists and control

The in-flux music world that makes tech-savvy fans swoon has a disconcerting effect on many artists. Some see a loss of control and an attack on their hard-won success in a business that was already chaotic. A public stance of embracing the download revolution invites a loss of revenue, while criticizing the pilfering is to pick a fight.

“I had no idea what I was walking into, the shrapnel that would come my way,” Lars Ulrich of Metallica says now about his leadership of a legal battle with Napster.

“If I had known, I wouldn’t have done it. I didn’t know there was this whole world into this. Now everybody knows.”

Metallica fought Napster even though it had invited its fans through the years to freely record and exchange bootlegs of the band’s concerts. “The difference,” Ulrich said, “is one of control. This is our music, our art.”

Singer-songwriter Michelle Branch is one of the young artists who have immersed themselves fully in online activities. She used to visit online bulletin boards devoted to Hanson and Alanis Morissette and try to drum up support for her own music. Before her debut album climbed the charts, she performed in an America Online forum devoted to breaking promising new acts. She turned 20 last month and received three iPods as gifts (she already had one of her own) as well as a purse that cleverly disguises speakers for playing the device without earphones.

After finishing the follow-up to her 2001 hit debut album, “Spirit Room” (which led to a Grammy nomination for best new artist), she visited AOL offices this year to play the music for executives.

“I know that sounds like something you would do for a big radio station, but now, with the way music reaches people, it’s not strange to go to AOL, believe me,” she said. Branch is among the 250 million worldwide users who visit Kazaa, the music swapping entity that has replaced Napster in the online lives of many fans, and also iTunes.

“Really, everybody in the music industry needs to learn to not be afraid of all this,” she said. “It’s not going away. And it makes things so great. In a few seconds I can find any song ever. How great is that?”

The interactive age has wired a bond between her and her fans, too.

“It’s a wonderful time to be a fan and a wonderful time to be an artist because the connection is there in a way that’s really new,” Branch says.

“I just think how it must have been with the stacks of fan mail coming in and how a lot of it would just sit -- now I chat with the fans online, I see the messages they post and I recognize their user names when we meet. I look for the ones that say they want to get backstage and then I find their pictures online and before the show I find them in the crowd and give them passes. I mean, it’s amazing.”

There is the promise that technology will create for adventurous music fans a personal safari experience -- there are systems coming in place on portals such as XM Radio that would not only track a listener’s tastes but also suggest new material based on those preferences, like a personal DJ and tastemaker.

Many of these innovations raise the question: What about the CD and its future?

Mike McGinley is a music industry veteran and a consultant to numerous companies, ranging from Best Buy to Universal Music. He says that while the date of the CD’s demise remains in question, the location will likely be Detroit.

He points to one of his clients, PhatNoise, a Los Angeles-based company that has a new digital device, the PhatBox, now becoming available as a manufacturer-installed, $795 option in new Volkswagen and Audi models. Like an iPod, the PhatBox can store MP3 files (a jolting 500 CDs worth of music, in fact), and McGinley says it’s just a matter of time before the drive-time popularity of music listening shifts to new technology.

“When you get that element of portability, that ease and quality, and you get it in the major American models,” McGinley says, “that will be the end of the CD for a lot of people.”

Even with the rush of new technology, the pace and direction of this revolution are not satisfying to all of the freedom fighters.

Take Marc Geiger, a music industry veteran who is well known for co-founding the Lollapalooza festival as well as helming ArtistDirect. ArtistDirect was an Internet venture that sought to set the standard for the digital age marketplace but became one of the many ambitious casualties of the bursting dot-com bubble.

A week after the Apple Store opened in Santa Monica, Geiger was among the customers. These days he is back working for the William Morris Agency, where he made his way as a savvy player in the concert industry, and he has mixed feelings about the store’s promise and premise.

The Apple formats and gadgets have been heralded as a new demilitarized zone between the music industry and the outlaw digital territories, and with good reason.

The online iTunes store opened April 28, and by mid-July, 6.5 million songs had been sold. The third generation of the iPod, which ranges in price between $300 and $500 and holds up to 7,500 digital song files, was also introduced in April and by the end of June, Apple had shipped its 1 millionth unit to the marketplace.

For Geiger, though, the technology candy of Apple makes great sense for a hardware merchant but seems like appeasement for the music sector. He calls Apple chief Steve Jobs a “rock star genius,” but he also said the whole notion of selling songs is limited with a generation of fans now snatching music files for free.”Jobs pushed it out two years,” Geiger said. “If the music business had not thought that they found a digital solution here, there would be more pressure to find new models. Now they have a reprieve. The last 10 years, for myself, I’ve been on a digital music evolution quest; I think the Apple iTunes store may be a one- to two-year delay in getting it where I would like it to go versus the record industry and maybe the media, which thinks this is a big jump forward.”

Geiger is a music fan and collector with 15,000 CDs, tapes and albums. “And I want to throw them away so bad,” he said. The future of music, in his eyes, is to make music like gas, electricity or water -- a ubiquitous service that comes into homes and consumers’ lives for a metered charge. Or for a flat-fee (a la basic cable services) or a mix of the two (in the fashion of cellular phone service).

A basic library would feed into the homes of America and (again, like cable television), specialty niches would be served by more tailored extras, say, rare classical or rock bootlegs. Geiger says music guides, DJs such as Nic Harcourt or well-known music critics, would become brand-name parts of the system, picking tunes. The result must be that the listener has control so music consumption becomes more like surfing the Internet than the passive posture of a radio listener.

“And then it will truly be your music,” Geiger said. “Everything you want it to be. The revolution is huge.”

The size, duration and priority of the revolution remain a topic of debate. This summer has seen a distilling of a new world order.

Along with the blossoming of iTunes, BuyMusic.com (run by Buy.com founder Scott Blum) entered the fray in July looking to copy the success story with the far larger audience that runs Windows software (iTunes is, for now, available only to Macintosh machines, which account for only 1 percent of the nation’s computers).

At the same time, old-guard Web sites that hoped to shape the digital music sector are falling away -- two of the highest-profile among them, MP3.com and Tonos, have been shuttered in recent weeks.

The iTunes success has been a mix of timing, Apple’s special brand of artsy simplicity, marketing and pricing. But it is also, so far, a minor victory in a major war. By some estimates, 35 billion music files are now downloaded each year, and only the tiniest trickle of that colossal tide creates any revenue for the music industry.

Still, on July 19, Billboard magazine launched a new chart in its venerable pages. In addition to CD sales and radio hits, Billboard now tracks the best-selling music downloads.

The arrival of the chart was duly noted within the music industry as a sign of the times, and it clearly is, but for now the chart and its barely-there business seems like installing a traffic light in a one-horse town.

The first No. 1 song for the new chart, for instance, was “Crazy in Love,” the summer hit by Beyonce Knowles, which earned that historic title with a feeble 1,500 documented and paid downloads.

The chart is, for now, a reminder that in the music industry, consumers have elbowed their way between the music and the industry.