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FROM THIS EPISODE

This is Celia Hirschman with On the Beat on KCRW.

According to Soundscan, the music sales monitoring chart, the highest selling CD this week sold less than 100,000 copies. It's a new low in the music business.

The large American record companies are rapidly becoming obsolete. These dinosaurs of the star-making machine have outlived their usefulness, and it surprises no one but the labels themselves. Once, the kingpins of smoke and mirror power, major record labels are now desperately attempting to hold onto the industry they once helped build.

This kind of turn in business gets ugly quick. Walk through the halls of these large, empty buildings, and you're likely to witness employees whispering in hushed tones, for fear of who might be around the next corner. Indecision dogs their every move. No one wants to get behind on a record, unless the right team at the top is sanctioning that action. And, as often is the case, the team you talk to today, may not be there tomorrow. Executives take each other down regularly when they sense vulnerability on either side. It's a real jungle.

So middle management does very little, which is often the safest move on a chess board in an uncertain game.

Underneath all the petty power plays lies an undeniable truth -- that the record business has been built on an intricate web of financial relationships with a large group of radio stations, media outlets and retail chains and their relevance is becoming increasingly questionable.

The new consumer doesn't care. Many don't listen to commercial radio anymore. They don't run to Best Buy the way they used to for music. They're more interested in reading MySpace.com than reading music magazines. The major label business hasn't updated its marketing tactics to suit the lifestyle of the new music consumer, and it will pay dearly for turning a blind eye.

This new music consumer lives, listens and breathes online. It's where they are exposed to music, build their relationships with artists and feel connected. The internet is a huge win for consumers, having previously been spoon fed access to their favorite artists by the label giants.

Independent labels have been far more aggressive online. They've long understood that building relationships with consumers is the key to their success, and the internet is ideal for this. Most independents have interesting and extensive websites, full of free downloads, podcasts, icons and other goodies.

Leave the confines of big business, and you'll likely find smaller labels a lot more reasonable all the way around. Sales that make up lunch money for major labels, feed a stable of artists at a small independent label.

More importantly, the culture of small label life is vastly different. Often living under the aegis of the little train that could small labels earn their stripes working twice as hard, twice as long. It is their sheer voracity that often wins the day.

So it's not suprising that some of the newest big wigs at the majors want to make their large labels look, feel and sound like the independents do. Setting aside the corporate structure, I think we're going to see a bit more downtown step in their style. It's not the first time the establishment went looking for a face lift, but it's hard to believe anyone with savvy wouldn't notice the difference.

This is Celia Hirschman with On the Beat for KCRW.

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