Spend about five minutes Googling the state of the music industry, and you’ll find doom and gloom reporting that is hard to rival in any other sector. Unfortunately, much of that opinion is not unfounded. It’s easy to collect myriad statistics supporting the idea that even the most talented artists should give up on making livings as professional musicians ( Exhibit 1, Exhibit 2, Exhibit 3). Musicians and composers are sold the idea that nobody wants to pay for their music. The only chance for financial success is to have a single become a viral sensation. While that may be the last viable model for the old school record label, it’s a terrible approach for the indie artist. As David Byrne points out, if services like Pandora and Spotify continue to grow as the principal way casual music fans consume songs, then the revenue from that group of listeners will be woefully inadequate to financially support all but a handful of artists. Free streaming audio is essentially a parasite that artists have willingly ingested.

Songs are currently sold as commodities, the same as toilet brushes and pink flamingo yard ornaments. This made sense to some degree when people paid for a physical album in order to obtain a song. This model simply doesn’t work in the digital age, where songs are represented as a bunch of effortlessly copied bytes of data. As blogger Seth Godin points out, the economic principal of scarcity doesn’t exist if it takes essentially no resources to duplicate your product. Those who keep fighting to find a way to monetize these digital copies are in denial. That battle is over. The genie is already out of the bottle.

In the Album 1.0 world, the artist lumped a bunch of static content into a package with the quantity mostly determined by the technology of the day. If you were releasing on vinyl, you filled up a record. If you were releasing a CD, you filled up a CD. The consumer got a thrill opening the jacket, looking at the liner notes, and holding a physical representation of the artist. Sometimes the whole record was brilliant, but often many of the songs were forgettable. Digital downloading meant you could pick and choose songs. It also made it extremely easy to get a copy of a song for free. But the key factor is that it meant casual fans no longer needed to make the same commitment as serious fans. Casual fans didn’t have to purchase anything. If they did purchase something, they’d just purchase the one song they liked. And they sure as hell weren’t going to the record store to buy a single anymore. We are still trying to force the Album 1.0 mentality on the digital world, and it just isn’t working.

If the casual fan has all but been eradicated from the picture of financial success for an artist, what are we left with?

Patronage. The future economy for music artists lies in connecting with fans who are passionate and loyal enough to provide the money and support needed to continue making music. Patrons are those people who love an artist so much they want to invest their most valuable asset: their time. They want to interact with the artist on a higher level. They want to watch interviews. They want to talk about the artist with other patrons. They cherish being in the elite group that hears a new song first. And, they adore anything resembling a direct interaction with the artist. Incidentally, fans who have that level of commitment also don’t think twice about spending money on the artist, because it’s an honor to do so.

So, how do we encapsulate that behavior so the artist can monetize the relationship to earn a reasonable living? Enter Album 2.0, where artists distribute their projects as apps. The traditional album may be on its way out, but that doesn’t mean people aren’t interested in larger artist statements. We just need to add a distribution format that is a better fit for the times. Apps can provide a much richer experience than the static model of music distribution we’ve essentially been using for over 100 years. As I discussed in my previous post, there are many capabilities provided by apps that are not available in the current model, such as dynamic songs and pushing out album updates to users. But, apps also have tremendous potential for a new level of intimacy between artists and true fans. When you have an artist’s app, it’s a destination. When you tap on an app’s icon, you are saying I want to spend some time with this artist. Apps not only recapture the thrill of exploring a physical album, but they offer a continuing relationship with fans that is scalable in a way that was impossible before now.

There’s a very nicely put together app called Jimi Hendrix: The Complete Experience. It is immersive and beautiful, brimming with content. It’s a fascinating look at how an app can take static content and make it very satisfying and interactive. Now, though, imagine Jimi is still alive, working his butt off in the studio (like he loved to do), constantly putting up new content on a server. Picture that you have his app, and you can subscribe to him for a small monthly fee. This gives you access to all of his content. He makes a track with 38 versions of a guitar solo, and your app has a mechanism so it can pull these solos from the server and play them along with the rest of the song (without pulling 38 individual singles like you would from iTunes). He pushes out special fan-only editions to the patrons who have the app. He writes a new verse to an old song and bam, you’ve got that, too. It also has something akin to a Twitter feed that is only accessible to patrons who have the app. Maybe there’s a game in the app that changes the music as you play, and unlocks songs as you win levels. All this is doable! But, most importantly, the app is a conduit between an artist and a real, human fan.

When I say “musical entrepreneur”, what comes to mind? Chances are it was somebody like the creators of Pandora or Spotify. Somebody using technology to make money off musicians. Why can’t the musical entrepreneur be the artist? Musicians become more technologically savvy all the time. Is it really that ridiculous to ask them to put out apps? Not if you give them, or the studios they use, the training and tools to get the job done. Perhaps it’s an opportunity for new jobs to be created for students who go to recording school and also get training in programming. It could be an ancillary operation, such as what happens now when recording studios pass along their tracks to mastering studios.

Does this new model mean artists need to be more sober about the definition of economic success? Yes, it probably does. As Jeremy Schlosberg writes, how artists will find financial security in the digital age is the “$64,000 question”. More than just a reference for a gameshow from the 1950s, it’s a great target for what success could mean to an artist as a yearly income. More than ever, musicians need to think like small business owners, and embrace both the challenges and flexibility of being one’s own boss. It’s time to abandon the idea of the rock star, bathed in riches and glory, propped up by extravagant major label support (i.e. debt, as Steve Albini illustrates). But, guess what? That crap wasn’t happening for you, anyway. How about trading it in for an app, 1,000 patron subscribers at $5.99 a month, and a full time career in music?