Previously, money was made by adding on a “tax” to the distribution process. This worked well because distribution costs money, and so getting a copy involved a financial transaction. Thus, collecting a bit extra to compensate artists/recording companies/etc. was not a big problem.

Now that distribution costs nearly nothing, and anyone can make a copy and distribute it almost for free, this model breaks down.

The question now is “how does an artist extract value from music?” The Because Effect is one way — let the popularity of your music generate other revenues (e.g., concerts). Are there other ways that artists can make money from their music. Is there a direct means of extracting revenue or is the Because Effect all there is going forward?