I’m chatting with Steve Knopper, whose new book, Appetite for Self-Destruction, charts the travails the music industry has been going through, Part I is here. Part II is here.

HITSVILLE: I was just thinking about your list of what a record company does: “signing talent, buying studio time to make albums, bribing radio stations to play the albums, bribing record stores to display them prominently and bribing journalists with free albums to write about them.” Let me add: Manufacturing and shipping CDs and doing muscular national marketing. Look at those two lists, and really, with maybe one exception, you could make the argument that, in theory, everything on them can either be done by any band or … isn’t really necessary any more. (I think that the argument that some strength in national marketing is still important, in terms of getting artists on magazine covers and TV shows and so forth.)

Now, I’d be interested to hear if you think that’s all really true, yet. I felt like I needed the weasely “in theory” in the sentence above because I think it’s clear we’re still in a transitional phase. Has a star yet been created outside the label system? I thought Clap Your Hands Say Yeah was a candidate, but their presence seems to have faded. Industry haters like me love to visualize a world in which the labels don’t exist. Will all that is solid in the record labels really melt into air? Or are they going to still be around and rambunctious?

KNOPPER: It depends on what you mean by “star.” Some acts have broken through via the Internet, like the one-man pop band Secondhand Serenade or the MOR singer Colbie Caillat, both of whom became experts in MySpace marketing before becoming big enough to attract a major label’s attention. But yes, even these examples speak to the reality that you need a major label to get REALLY big. That’s because the most efficient way to turn an unknown artist into a star remains the traditional route—sign with a label, use its connections to get on the radio. But with radio and the labels shrinking, I believe we’ll soon start to see bigger examples a la Secondhand and Colbie or even OK Go, a Chicago rock band that made it big based on a random YouTube gimmick sensation. (Curiously, OK Go were signed to Capitol/EMI at the time.) I don’t see labels melting completely. I mean, you and I could own the Beatles’ catalog and make enough money off it to be pretty dang rich. And you’re right, some of the marketing and publicity functions labels do are difficult to find elsewhere. But they’re shrinking, even more so with the recession, and we’re already seeing artist managers take over the traditional functions of some of the labels. That will probably continue to happen on a greater scale.