Matt Nathanson

Digital music: The battle rages on

August 13, 2009: 8:00 AM ET

Squabbles over the rates and rights online radio should pay highlights a fundamental problem: the music industry is broken.

Musician Nathanson is frustrated with the recording industry. Photo: Chapman Baehler

Musician Nathanson is frustrated with the recording industry. Photo: Chapman Baehler

The music industry has become that annoying dysfunctional family you  don't want to hang out with. Think Everybody Loves Raymond, but not funny.

The latest episode: infighting among online radio stations, artists and labels over royalty rates and who should pay what to whom and for how much.

For two years, Internet radio webcasters negotiated with artists on rates and last month the parties reached a set of agreements that essentially sets royalty rates based on a site's size.

Across the web, it was declared that Internet radio had been saved. Listeners thought for a split second that perhaps the fractured music business had reached digital détente. And just maybe, fans thought, executives could focus on more important things, like making great music and figuring out how to grow the industry. More

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