Everyone loves to talk about the death and the demise of record companies, as if they’re all going to curl up and die today, returning the power back to the artist. Personally, I think this is a load of crap. While certainly the record industry is in decline and huge changes to be made, none of those changes will involve the death of all the major record labels. There are, however, some interesting possibilities for the future of the industry, and I will present one of my theories for you now.

Why won’t the record labels die? Well, one good reason is that bands like a lot of the things labels do. Consumer advocacy groups, pirates, lawyers, and other sorts of interesting people have brought a lot of attention towards the fact that the record labels do many evil things. But at the same time, they do a lot of things that bands can’t easily live without.

Musicians want to make music, and most of the time, it really is that simple. That is what they want to do. They do not generally want to also be their own managers, negotiators, producers, web developers, graphic designers, audio engineers, merchandisers and accountants. This is where the record labels come in. They handle all that stuff and let the artist be the artist.

Do the record labels need to change? Yes. Of course. But let’s not throw the baby out with the bath water. There are a lot of things the labels do that artists need.

And that brings me to my theory, one that I am personally betting in, as I am considering getting into this market myself. I call this article one future of record labels because in the future, there are going to be many different options for artists to choose from. But I predict that this will be one of them. I predict that a new sort of marketing agency is going to emerge to handle all of the things a record label currently handles for artists, but while conducting business differently.

This new sort of marketing agency would have the resources and talent to produce records, book shows, design and sell merchandise, and handle all the business stuff. But unlike the current balance of power, the marketing agency would be hired by the band in exchange for some percentage of the band’s income. Maybe something like 20%.

In the end, this could change the whole industry for the better. Bands would no longer be screwed out of money in record contracts. They could still provide creative input for how they would like their records/websites/artwork to turn out. (In fact, they could fire the marketing agency if they did not do a good enough job.) Yet, they’ll still end up with quality results, as the work will have been done by creative professionals who specialize in what they do.

In fact, I would bet the quality would be higher than what comes out of record labels currently, because there would be more of an incentive to do well once their commission was determined by how well the band does in the marketplace.

Furthermore, this could be a very profitable endeavor for the marketing agencies. Taking a commission could seem like risky business, but in fact, if you worked with enough artists, the money would be more than enough to turn a nice profit… especially if you do a good job.

So that’s my theory. Time will tell whether or not I am right.