Moving towards music distributors being required, as part of the licence, to divert a portion of revenues to matching patronage to artists would be an alternative. That way, person A, who would have supported one project for $100 000 can now support two, with $50 000 each of matching funds (assuming 1:1 matching) making up the other half. The distributors could also dis-intermediate the patrons, the difference between this model and the labels being that the artist would have the freedom to distribute their music for free as well.
Note that an un-intended consequence of this would be music losing mass appeal and catering to the tastes of the patron minority. Given the state of popular music I'm not sure if this would be a terrible loss :P.
My argument is there aren't enough dollars seeking that experience today as there are consumption dollars (which the industry has gotten used to). In the past, monetising that long tail of demand was prohibitive. Today it is not. As a single example, I would never contribute to support a musician yet my lifetime worth to the music industry is at least tens of thousands of dollars (including concert tickets).
There is enough money in that delta to fund the artists, lobby legislators, and enforce the status quo. That's the problem. If you aren't re-routing that demand you're proposing a nice but idealistic hypothetical.
The concentration of power is a good point, it would be best to have a healthy ecosystem of Kickstarter clones or at least some model that avoids a single "hottest projects" page, those damn things bleed money from everyone else to create blockbusters.
I guess there will always be a place for pay services dealing with recommendation or cloud storage but I'm assuming that the value of a digital copy of a song, streamed or not, will be zero pretty soon.
One could still have free music for those who value
dollars more than time.
There's no reason in principle that an ad-supported iTunes clone couldn't do everything iTunes does - it could be more convenient, in fact, as you wouldn't have to muck around with credit card numbers and passwords. The only reason piracy is inconvenient at the moment is because it's illegal.
I am thinking of Pandoras or Shazams, perhaps with features that let me say "someone make a song like this". One could see the emergence, as a counter-movement, of heavily DRM-protected "limited release" albums.
When you make something people value free strange things happen. The most likely is still the use of force to enforce profits, i.e. some form of copyright regime.
Google, Youtube etc are all free - it's obviously economically feasible to distribute media online for just ad revenues.
My comments:
I like the structure, but am concerned about the separation of consumption and patronage. Our society has become far more consumerist since Victorian times and ignoring that cultural shift could be problematic. I propose fortifying crowdfunded patronage with a matching fund that would match crowd patronage dollars.
In college I was cheap and pirated music. Now I care more for convenience than a few dollars and so download my music via iTunes, where cover art, filing, and synchronising is taken care of. I suggest adding an optional (or maybe not) extra $1 (or whatever) to be directed into a matching fund. This fund would then match, at a ratio to be determined after further thought (would probably be a moving scale), crowd patronage dollars to artists. Thus, the consumption and patronage are joined somewhat.
One could still have free music for those who value dollars more than time. The downside is the iTunes of this analogy would be a power centre. That said, it would be naive to assume any such system wouldn't concentrate power. It might be good to have an iTunes figure opposing the Kickstarter one.