The news that more major music artists are jumping ship from major labels and seeking out their own digital distribution methods shouldn’t shock anyone.

Music artists at their core want to connect with fans, and they want their music heard. Artists don’t need major labels or radio stations to do that anymore. Thus, you’ll see a continued exodus of top talent in the next few years.

The only stumbling block is exposure. Another old-media mainstay, radio is where most people hear music. That, however, is quickly becoming extinct too. Sites like Last FM, MySpace and others help users discover new music. Facebook is busy developing a new way for users to discover new music utilizing its vast social network, and social networking may be the future in how music is discovered.

The power that Facebook has over MySpace is its ability to allow developers to harness its social network. For instance, you could get music recommendations based on what your friends like, or you could get recommendations based on similar musical styles. What Facebook could do is allow users a new, organic way to discover music.

That’s the last thing radio stations want to hear. But they have been in bed with the labels for years. It became common practice for labels to pay radio stations to play certain songs and artists.

Many so-called popular songs weren’t popular because listeners requested them but rather because labels pushed them because they believed they could make a lot of money with them. Throw all that out of the window. The future is listening to music and discovering music that you and people like you want to hear.

Radiohead and Nine Inch Nails are big-time artists leaving the stables of major labels. They can afford to do this because they have an established fan base. Plus, they don’t really need the money.

They can take risks. For them, it’s about making music and connecting with fans. Labels have always gotten in the way of that and have become downright hostile towards fans in recent years. One thing labels seem to lose focus of is that when people illegally download music it’s because they like the product.

They may be downloading it illegally because they find your other distribution methods cumbersome or that the price you want to charge is too high or that they only want one song on an album you want $10+ for. But they fundamentally like the product, which means the labels need to find new ways of getting that content to fans and making money off of that content. This is a concept NIN’s creator Trent Reznor understands:

“Personally, I would like people to support artists,” Reznor said. “After all, we as artists dedicate our lives to producing the best music we can. It’s been a painful process for me personally (to see the changes in the music industry). But should I be angry at the audience that wants to hear music so much, an audience that is so passionate about hearing it they go online to get it two weeks before the music debuts? No, I want them to be that way.”

Reznor and others postulate that artists may begin transitioning over to a business model where they make less money off of their recordings (or even give them away free) and the bulk of their earnings off of merchandise, Web products and live shows. It’s an interesting thought, and I think it may work for many artists.

Artists can free themselves from major labels, which means they’ll make a higher percentage from each album or song sold, and they should make more per concert and for each item of merchandise sold. Artists could sell albums online from their own Web sites or other digital distributors for a so-low-how-can-you-not-pay-for-it $4.99. A price like that means a lot more people will be willing to take risks on new music, and it should allow for an artist to have greater exposure.

Plus, one of the fundamentals of economics is volume, volume, volume. How do you think Wal-Mart got so big? By selling a few products for a high price?

Greater exposure means a bigger audience, which should translate into bigger opportunities for concerts, merchandise, Web exclusives (how about either using ads or a subscription model to offer a vibrant Web community for an artist, which allows that artist to give fans something more than just standard music, while also making money?), etc. But this whole hypothesis only works for artists that have been discovered to an extent. What about the unknown artists?

MySpace, facebook and other social networking sites should be catalysts for tearing down the main stream radio hegemony. Radio stations play the same music over and over again, often because they have been paid by the labels to do so. In short, it’s a poor way to discover new music. That’s where social networking takes over.

Discovering music from like minded people is what social networking offers. Sites like Last FM and Pandora have been doing this for awhile now, and they are gaining popularity. If the labels don’t shut down Last FM and others (they have tried by upping fees) it and sites like it will be a water-shed moment.

The irony of this whole situation is that it could have been avoided, and the labels could have strengthened their grip on mainstream music and made a lot of money. Music labels could have offered music digitally before Napster erupted. They could have stop charging $15-20 a CD and offered singles before piracy became widespread. They could have encouraged sites like Last FM or even spurred the creation of sites like it.

Instead, they have chosen to fight all these changes along the way, usually being several steps and years behind the curve. It seems they know the least about what to do with their prized assets, and they are willing to openly battle their own customers over how they consume their assets and what they consume. It’s only a matter of time before we see major changes within other media industries like movies, television and even bigger changes in journalism.

It just goes to show that the aversion to change is not a unique newspaper or journalism problem. Media companies in general tend to be behind the curve. They want to hold onto what they know — what they know to eek the most money out with the least amount of effort. They aren’t in the business of innovation, which is why they constantly get out innovated by more nimble companies on their home turf.

And, of course, is the reason why those large media companies will cease to exist within time. They got to the top by delivering content to people in formats people wanted. Now, for some strange reason, they have turned their backs on trying to deliver products that people actually want. Then they have the nerve to complain when people don’t want them.

We are entering an era in which people can decide what content they want in which formats they want, and people can decide how they get it. It’s an era of choice, which is exactly what the big media companies can’t give you. And won’t.