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I agree that it's not viable for unknown artists yet. However, I know that NIN and Radiohead both made money from their ventures through taking donations and offering special deluxe editions that hardcore fans. Though, of course, unknown artists are going to have few hardcore fans that would buy such.
I think the Internet and file-sharing is evolving so fast that the record industry can't keep up, and no one's really sure where it will eventually lead. But anytime I can get something free, I don't complain.
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