Oh please! Don't be so melodramatic. There was a huge music industry before recordings and there will continue to be after recordings (as we know them) pass from the scene. Speaking of rock bands, there are hundreds of good rock bands who never got that big record deal. Yet they make a damn good living doing concerts. In fact, even the superstars make more money in concerts than they do from recordings. That's why you have old farts like Mick Jagger pathetically shaking his 60-year-old ass on stage for $100 a pop. That's where the money is - the Stones sure aren't selling a lot of copies of "Beggars Banquet" these days.
If anything, file sharing has given lesser known bands a chance to become more widely recognized. Case in point, I recently bought a CD at Amazon.com from a group called "The Reverend Horton Heat." Awesome stuff (if you like full-throttle George Thorogood-type supercharged blues/rock). They've been around for 10 years but I never heard of them until I stumbled across one of their MP3s while searching for something else. Now I will probably buy more albums from this band thanks to the file-sharing that is supposedly ruining the recording industry.
But I can see where the major labels are complaining. For instance, they can no longer put out a hit song and then sell us a $15 album of mostly crap. We can now download the other tracks on the album and if they don't measure up, guess what? We don't get the album. And why should we? In the long term, recording artists are going to have to just put out better albums that we will actually want to buy (or download for a fee).
Personally I think the CD is going to go the way of the vinyl record pretty soon. This is how I see the recording industry evolving:
Increasingly, radios, stereos, etc., will contain hard drives - or "music" sticks - that can easily be removed and reprogrammed from a computer (or a kiosk, which I will talk about later). These music sticks will hold thousands of songs. Instead of selling albums, the recording industry - or whatever passes for it in the future - will sell "downloading rights." Consumers will be able to purchase downloading rights directly from the record label or from a "middleman" that is acting as a sales agent for the record label (much like the function a record store serves today). Consumers can either purchase the downloading rights to entire albums or individual tracks a la carte. Of course, they will be able to sample the MP3s first from any of the file-sharing services such as KaZaa or Morpheus.
Once the consumer has purchased downloading rights, he/she can either download the music files directly from a website or they can bring their "music stick" into a store or kiosk and download to it directly.
What is the advantage of doing this as opposed to downloading and keeping the free MP3s? Well, once one has purchased downloading rights, he/she will have the right to download it whenever they want and how ever many times they want. So if you lose your Walkman, you can buy a new "music stick" and instantly download the music you have already purchased onto it at the point of purchase. For you will have an account on file with all the music you have purchased. So whether you own 10 songs or 5000 songs, you will always be able to stop at one of these kiosks (sort of like a ATM machine) and fill your music stick with these songs (or download them off the web thought this would take much longer).
I believe that people would pay for this convenience rather than go through the hassle of finding the MP3s online. Imagine if you stored 5000 MP3s on your computer and your hard drive crashed? Now you would have to individually search and download each song and then you would have to play it back to ensure its integrity. What a major hassle! It would take you weeks. But had you already owned the downloading rights to this music, you could go to a kiosk and blast those songs into a music stick in about 15 minutes over a Firewire or similarly fast connection.
That is the wave of the future.
You are incredibly wrong. Mny of the old classic albums continue to sell well and make up the bulk of music sales today. In the recording industry, they have what is called "catalog," which is essentially old stuff that still sells and perovides the bulk of the industry revenues. The industry has been making noises for about 5 years since very little of the music in the last 10 years has any shelf life -- music is now made like NFL teams -- to get the $ now, NOT to last. THAT will kill the musing industry far faster than the internet,