That's my prediction. With all the pirating in China, and the existence and popularity of peer-to-peer software such as limewire (especially amongst the younger demographic) the profit margins will approach ZERO. Everyone knows CD sales are taking a nosedive. Costs of releasing an album includes marketing costs, royalties, manufacturing, etc.......too many costs associated when sales are decreasing. Where are the artists & labels going to generate any decent revenues?
Music will be free within 5 years (or most music). Artists are slowly finally getting it. Release music for free. Avoid the labels. Make money on your brand.......CONCERTS direct. The revenue will come from Concerts, T-shirts, advertising, website. There will be a bigger cut for bands that have quality loyal following. Ticket prices will go up but thats offset by free music. By making the music free, artists will open doors to more fans and demographics = generating more revenue by reducing costs. I can go on and on in much more detail but work is calling me.