Most music industry veterans look back on 1999 with the same mixture of sadness and dread that stock market analysts reserve for Black Monday. 1999, as we all know, was the year Northeastern University student Shawn Fanning irrevocably altered the way millions of future consumers would acquire and consume their music by releasing Napster. Since then, the variously acrid remarks of major label CEOs and the litigious actions of the Recording Industry Association of America (RIAA) and the British Phonographic Industry (BPI) - both of which have actively pursued criminal charges against everyday music consumers for illegal file sharing - have contributed to the faulty characterization of the Internet as something inherently damaging to the business of music. Not coincidentally, the last seven years have seen majors largely responding to the digital sphere in one of two ways: with callous indignance or boorish marketing schemes that hit as many wrong notes as right.

Apple's iTunes may have dragged major labels kicking and screaming into the digital world, but it hasn't made them unplug their ears. Despite snake-bitten profit margins and increased competition from video games and DVDs for the home entertainment dollar, the major label music world, for the most part, has continued to cling to an increasingly-outmoded worldview. As consumers' consumption habits evolve at increasingly rapid speed, the majors continue to plunder along at mach dinosaur, making them a stubbornly reactive animal in a changing climate that's evolving into one where only the proactive will survive.

Another interesting landmark happened to the music industry in 1999. It was the year Connecticut techno artist Moby made history by becoming the first-ever musician to license every single song from a full-length record for commercial use. Upon its release, Play couldn't get arrested by traditional radio and music video outlets, but once its 18 songs began to show up as the soundtrack to hundreds of television ads worldwide, Moby exploded. By the time the album's engine came to a lurch in 2002, it had sold close to 10 million copies globally.

Every music supervisor will tell you Play helped open the floodgates on the licensing frenzy that has since come to define the world of music and advertising, but some don't think it necessarily has to stop there. According to Chris Munger, onetime A&R at major publisher Warner Chappell and current resident music supervisor at Yessian Music's newly established licensing division Dragon Licks, the past five years have seen the power dynamic between labels and publishers begin to change. "The publishing companies used to be the underdogs and the record company was the top dog, but now it's kind of flipping around a bit," he says. "People always wanted songs for ads, but it was so hard to get them - now the label's almost throwing them at them."

POWER SHIFT
That labels are increasingly relying on publishers for revenue is telling of their slipping foothold on the market. With musicians enabled by cheap technology and consumers discovering music from within a sphere far outside the majors' comfort zone, the parameters that define how an artist gets discovered and distributed have started to change. And, just as it's done with Moby and countless other artists, the advertising industry is the one picking up the slack. In other words: major labels aren't the only ones on the hunt for saleable musical talent anymore.

"I feel like I haven't left the A&R world," says Munger. "I feel like I'm more involved in it now than I even was before. I'm always looking for new acts, new bands and new songwriters to get plays for commercials. I'm getting stuff sent to me on a constant basis, and I'm always listening, because you never know where it's going to come from. It's kind of ironic. The labels will turn down these songwriters or bands, and I'll wind up finding them and getting them placed inside commercials. That winds up hurting the labels more than anything - I think they're kind of starting to feel the damage from that."

Not only has the music supervisor's role started to mirror that of a traditional label A&R person more closely over the last five years or so, agencies and music houses have also become increasingly adept at marketing new music to the online contingent. When Sarah Gavigan started the Venice, CA-based Ten Music six years ago, she says the company - which finds commercial work for its roster of independent labels - "was just about licensing." Nowadays, Ten is more proficient in marketing than ever. "With the accepted birth of online as a true advertising and marketing format, it opens up a tremendous amount of more doors for us as representatives and labels," she says. "And I don't just mean digital distribution. I mean the opportunity for a label or an artist to work in conjunction on a project or to lend their music to something online. It's a more direct way for a consumer to find an artist."

Like a handful of other music houses, the BBH-backed London music publishing and consultancy service Leap Music has gotten into the ownership and distribution game. According to founder Richard Kirstein, the new subsidiary company Leap Masters is "effectively a digital record label" that acquires the master recordings of commissioned scores or re-recordings and releases them as a download. Leap's most recent project is a cover of John Denver's "Leaving On A Jet Plane" by Sophie Barker, a singer most famous for her work with British electro-soul duo Zero 7. Commissioned for a Daniel Kleinman-directed spot for British Airways, the spot is currently available as a download via most of the UK's digital download services. "So in that space, we are acting exactly like a record label," says Kirstein. "We're acquiring master rights, we're involved in the A&R process, we found the singer, we helped develop the recording and we're selling through a distributor and taking it to market as a digital download... for me, that's a good thing. It shows that the discovery of talent isn't the monopoly of labels and publishers, the ownership of music rights isn't the monopoly of labels and publishers, and you can launch a track off the back of anything, whether it be an ad or a film or a game."