With Online Music, It's a Buyer's Market

Shared, Often Eclectic Tastes Determine What Will Sell

For years, old recordings have piled up in the archives at Verve Records, including beloved jazz tracks that had no market big enough to justify pressing new discs. But thanks to the Internet, music lovers are rediscovering iconic titles like Ella Fitzgerald's "Sunshine of Your Love" and Quincy Jones's "Body Heat" -- rekindling enough popular demand to prompt Verve to reissue them through a project called Verve Vault.

"The demand for music has never been as big as it is today. We get all kinds of questions from customers worldwide, looking for a track name or an album, or asking, 'Why haven't you put that out yet?' " said Jon Vanhala, vice president of new media and strategic marketing at Verve. So far, about 2,700 albums have been brought back through the Vault, with more than 5,000 scheduled to follow.

Because the Internet has changed how people discover and share music, the rules of marketing it and the hierarchy of who determines what's hot have also changed. As radio-music listenership declines, the industry finds itself spending more time courting a broader field of tastemakers who, through Web sites, are popularizing songs that never get radio play. The primary tool in this transition is the playlist -- a sequence of tracks posted on blogs or shared on music purchase sites such as iTunes.

"I listen to way more music than I ever have in my life," said Robert Burke, a North Carolina quality assurance manager by day who spends nearly all of his free time searching through new music online, then compiling tracks in playlists with various themes, like rock songs that include a tuba, Top 20 bands from the 1980s with mullets, artists who sample riffs from Miles Davis, and so on.

"I kind of started it because I've always collected music, and I've become pretty obsessed with it since then," said Burke, whose blog on Yahoo Radish, Playlistradish.com, has published thousands of his playlists for the consumption of others.

With legions of new bands popping up online every day, fans need guidance just to keep up, said Oliver Wang, founder of Soul Sides, another high-traffic music blog.

In the online world, friends' recommendations or an endorsement from bloggers such as Wang and Burke, as well as podcasts such as "The Nashville Nobody Knows" and "Accident Hash," can yield significant marketplace results.

A duo called Gnarls Barkley, for example, found a huge following online. The band's songs, including "Crazy," were well established online before getting radio play. Its songs have been listened to on the band's MySpace social-networking site more than 6 million times. Transatlantic online exchanges made the British band Arctic Monkeys famous in the United States before any album came out here.

"Word of mouth benefits [independent labels] in particular, and we're only starting to see the benefits," said Kevin Arnold, founder and chief executive of the Independent Online Distribution Alliance, which disseminates music from 2,500 labels to digital music services.

To court the online tastemakers, the alliance last fall launched Promonet -- a system that maintains a master playlist of new releases for reviewers, Arnold said.

Digital music services themselves have become engines of recommendation. Music stores such as iTunes, EMusic, and Yahoo Music give users the ability to check out others' playlists, so people with similar tastes can find each other and discover new music. Additionally, services such as Rhapsody, Napster, Livefm, Pandora, AOL and Yahoo all have Internet-radio options with algorithms that register a person's taste and, based on the listeners preference, stream in similar, new music.

"I've found a few bands that way," including one called the Magic Numbers, said Alex Kilfoyle, 23, a Washington electrical engineer.