One thing is clear: the times they are a-changin', and a-changin' fast. The mainstream music industry is in such an epic collapse that some are predicting its imminent demise. While CD sales dropped more than 20 percent this year, Apple reported that, through 2006, it had sold over 2 billion song downloads through its iTunes online store.
       
        So where does the small but thriving ecosystem of folk music fit into all this? Is this the best of times or the worst of times; the dawn of a new era in which folk will thrive, or the coming of a long twilight?
       
        A lot of the early indicators are that the new digital revolution will be a huge plus for folk music, helping it to be heard by millions of people the old filters of the pop industry prevented it from reaching. All of the jobs required to sustain a grassroots music like folk, from recording to publicizing events to reaching new fans, seem at once easier and more affordable.
       
        The future looks bright; the question is, can we get there?
       
        Consider these factoids:
        The New York Times reported recently that many music industry experts predict the CD will be on its way to extinction after this year.
       
        On folk singer John McCutcheon's website, CD sales have increased 20 percent every year for the last five years. At the same time, he estimates that Internet publicity opportunities save him $20,000 a year, while vastly enhancing his ability to reach fans.
       
        Tower Records, which operated 9,500 stores in the 1990s, went out of business last year.
       
        Rounder Records, the country's largest folk label, has seen years of record growth nearly wiped out by the decline of retail record stores.
       
        If Sing Out's circulation is calculated the way most periodicals do - counting every sale and subscription as reaching 2-3 readers - its readership today exceeds its peak during the '60s folk revival. Last year was its best year ever, in terms of ad revenue - and nearly all those ads were placed by folk performers and businesses.
       
        Club Passim, the venerable folk coffeehouse in Harvard Square, currently sells out 80-90 percent of its weekend shows.
        The Ark in Ann Arbor, Michigan, which has presented live folk music since 1965, is selling out more shows than ever before. Still, it is bracing for bad times - but not for the reasons you might think.
       
        At WKAR, the public radio station for East Lansing, Michigan, longtime folk host Bob Blackman's weekly show, the Folk Tradition, attracts nearly the same listenership as the weekday average, even though it is on Sunday, the worst ratings night of the week.
       
        At WUMB-FM in Boston, a full-time folk music station, broadcast ratings are stable, while Internet listenership has more than quadrupled.
       
        On CD Baby, a website that functions as a co-op album merchant for musicians, folk sales rank third, behind only rock and pop - and far ahead of rap and jazz.
        Roughly 15 billion dollars exchanges hands in the live music business each year; but only 9 percent of that goes to the major concert market - and that part is rapidly declining.
       
        Internet radio station Folk Alley, in Kent, Ohio, had its best year ever in 2006, both in terms of listenership and member support.
       
        Minnesota folk label Red House Records was in a dangerous decline after hitting its all-time peak five years ago. Last year, however, it nearly reached that peak again, despite the collapse of Tower and other retail outlets.
       
        This story is not an attempt to survey the entire folk waterfront, but to focus on this remarkable moment in the history of music. The hope is to read the pulse of the folk world today, and perhaps offer a prognosis for its long-term health, through the lens of several folk and Internet businesses, including performers, record labels, radio stations, and merchants.
       
        Since the collapse of the '60s commercial revival, folk has slowly rebuilt itself into a sturdy, grassroots, community-based music that can function on its own energy, free of the fickle winds of the mainstream. It did this not only by continuing to support performers, but by finding ways that fans of the music could provide all the services necessary to sustain it, from labels and coffeehouses to publicists, retail outlets, and radio programs.
       
        So how is this modern folk biz weathering the strong winds of change? McCutcheon, who was onto the Internet revolution so early that his website is actually Folkmusic.com, thinks the early signs are good.
       
        "This is a ripe time for folk music," he says, rattling off a convincing list of ways digital technologies are strengthening his career. People find out about his shows from his own website, meaning that isolated fans, who would have had no way to know when he was performing in a nearby town, are now finding him.
        He can offer digital downloads of his mostly timely, topical songs, making them available to all his fans as soon as he writes them. His website offers his complete album catalog, which is spread out over several record labels, for the first time ever in one place. And he personally pockets about 50 percent of that money, as opposed to roughly 15 percent through record store sales.
       
        McCutcheon is now serving his 35,000 member mailing list by e-mail. He admits his "neo-luddite tendencies" kept him from making that step earlier, but "when I overheard two 85 year-old people exchanging e-mail addresses at one of my shows, I thought, okay, it's a digital world."
       
        Crooked Still's lead singer Aoife O'Donovan, 24, needed no conversion to the digital world; she grew up in it. For all her modern ways, however, her band is in the vanguard of the burgeoning stringband revival, and performs mostly traditional American folk songs. She sees a lovely convergence happening through cyberspace, with many new fans becoming open to folk music at the same time it is getting easier than ever to find.
       
        "I think folk music is definitely becoming cool," she says. "All these festivals we play are encouraging young people to come, and they are. One thing that's amazing about the Internet is your ability to reach fans, and have people find out about your shows. We've had so many people come up to us and say they heard about us through other people's pages on Myspace. That sort of social networking way of finding fans is totally new."
       
        She's referring to Myspace.com, the immensely popular do-it-yourself website service, on which performers often list one another as friends, making it easy for fans of O'Donovan to hear the music of similar singers and bands. And for fans of those singers to find her.
       
        CD Baby is also very good at that, allowing fans to browse for music they might like but don't know. They have "Try This" buttons on each artist's page that connect to similar performers and genres. But they also have fun search areas, called "Flavors," designed for idle browsing, such as "Music to Get Drunk To," "To Have Sex To," "When You Just Want to Laugh," and the always folk-friendly, "Depressed? Stay Depressed."
       
        CD Baby founder Derek Sivers, a musician himself, thinks the new technologies are destroying the music industry's power, its ability to decide which music is heard by the public. That's nothing but good news for folk music, he says.
       
        "In less than 10 years, that old gatekeeper mentality is almost gone," he says. "It's amazing to me that just anybody can record anything, pay us a small fee to put it up on CD Baby; and within a few weeks it's also up for sale in iTunes, Yahoo Music, Napster, Rhapsody, through Verizon cell phones and even Ringtone.com. All these companies are coming to us now, saying 'Give us everything; we want as much music as you have.'"
       
        "I love how that's put the musicians in power. All these big companies that used to act like filters, letting one in a million through, are now saying, 'Give us everything.' That's beautiful; it's amazing. The musician now has the chance to put whatever they want out there, and let the public decide."
       
        Over at Sonicbids, which offers electronic press kits and booking leads to performers and venues, founder Panos Panay is equally optimistic about folk's future. The troubles facing the big concert industry bode well for smaller genres like folk, he says. He is quick to stress that the only reason the major-arena level of the live business is as high as 9 percent is that they have been responding to declining attendance by raising prices. Selling less for more is rarely a recipe for success.
       
        "Paradoxically," he says, "our observation is that while the record business may be in decline, the music business is not. I think it's finally embracing and making room for so many more people to be part of it that it's actually exploding and becoming more robust than ever."
       
        He says that everything started to change in the late '90s, when the aristocracy that had controlled the music business from the top down, and basically only cared about the top, failed to recognize how easy the Internet was making it for people to find music without them.
       
        "Because of the tools the Internet provides,"  he says, "it's now possible for a robust middle-class to emerge in music. Artists in every class now have the tools to rise to the next level. It's never been more possible to have a kind of middle-class career in music."
       
        Of course, that perfectly complements folk singer Utah Phillips' old battle cry that, "In folk music, you can make a living, not a killing." The idea of a sustainable, reasonable career as a performing musician is nothing new in the folk world. It's just never seemed quite so doable.
        Folk makes up about a third of Sonicbids business, with pop only a few percentage points higher.
       
        "And folk people have been our more loyal members," Panos says. "I think that's because people go into pop looking for quick stardom. The folk artists tend to be more grounded; their expectations are tempered. They're not coming here to be the next Kelly Clarkson; they want to have a career."
       
        So if all this is true, and folk is catching such a rising tide, why does it seem to be losing ground in public radio? According to Pat Monteith, director of WUMB-FM, it is up against a strong drive toward single-format radio, largely to raise needed funding from big sponsors and advertisers. All the big sponsors generally want to know are the overall numbers, the cumulative hours the average person listens per week. In ratings-speak, it's called the CUME. And the CUME is not kind to diverse programming.
       
        Let's say a folk show runs two hours a week, and does very well. That's good, right? Not necessarily. Very often, people who tune into the folk show only listen to the station for those two hours a week. If the overall CUME is, say, five hours a week, those folk listeners actually pull down the overall average. And the more of them who tune in, the lower the CUME goes. In short, the folk program's very success works against it.
       
        "That's not widely known," Monteith says. "Station managers don't like to talk about it, but it's a fact. If people are just listening to that one show, and not  the rest of the station, the station's overall numbers go down. It's a big problem when going to big corporate sponsors, because all they want to hear is the CUME."
       
        Once again, however, the level playing field of the Internet makes folk music look more vibrant and viable. When Monteith approached the Internet multi-station service Live365, they at first refused to allow WUMB to be categorized as folk. They didn't have folk as an option, even though they had lots of folk-friendly stations. Once folk was identified as a Live365 choice, however, it quickly rose into the top-10 of all formats listed.
       
        "This happens a lot," Monteith says. "They try to put you into an alternative category, into pop or public radio. But when we step up and fight that, and insist on being called what we are, people find out that folk is a lot more popular than they thought it was."
       
        When Kent State University's station, WKSU, wanted to create an Internet station, it looked over all the formats if offered, decided folk provided the best opportunity, and created Folk Alley. Nearly 2,000 listeners sign up every month now, from all over the world.
       
        "The audience who listens to WKSU's folk shows is so passionate about the music, and so strong at fundraising time, that the station knew this was a community that was very active and supportive," says Folk Alley programming and marketing director Linda Fahey.
       
        Suddenly, the quality of the folk listener, which ratings services can't calculate, mattered tremendously. And again, folk pushed to the top.
        So how is all this good news translating to folk businesses, like record labels, venues, and music stores?
       
        Elderly Instruments founder Stan Werbin saw the possibilities of reaching a global folk consumer base in 1975, beginning a mail-order outlet for his music store. Instrument and accessory sales are generally stable; but intriguingly, while CD sales are declining 10 percent a year, music DVDs, most of them instructional videos, are way, way up. That suggests to Werbin that interest in playing music socially is on the rise, which is always a healthy sign in the folk world.
       
        Werbin thinks the power of the Internet is protecting Elderly from the dire economic realities that are destroying many music retailers. For example, they now send out only one catalog a year, as opposed to three or four in the past. They use the catalog as a connector to their website, rather than as the sole representative of the store in people's homes. New printing technology allows them to make much more attractive catalogs for less money and manpower.
        Even more importantly, Werbin thinks, the ability to group people by sales habits allows Elderly to have a more personal and rewarding relationship with its customers. Banjo fans get banjo news; ukulele players get ukulele news. And it's all done by e-mail, so it's free.
       
        "That's something we never would have been able to do before the Internet," he says. " It would have been far too expensive. We hope it keeps us on people's radar, without having to send them a whole catalog every three months."
       
        At Club Passim, the bimonthly calendar has become more of a premium item now, mailed out as a member benefit, and available for free at the club. Even better, they are now selling most of their tickets on their own website, saving both the club and fans the often exorbitant service fees charged by agencies like Ticketmaster.
       
        "Plus, we have links to performer's website on our online calendar, so people can hear what acts sound like," says Passim manager Matt Smith. "It's a more hands-on, complete, and easy experience for fans."
       
        At the Ark in Ann Arbor, which Werbin called a model for how to run a coffeehouse as a business, program director Dave Siglin reports that business is good, and insists that the troubles of the pop industry don't affect him in least.
       
        "What is affecting us, and will even more," he says, "are the plant closings and major corporations leaving town. That's going to affect us big-time, definitely in grants and funding, and likely in audience. When the auto plants closed around here, our blue-collar music took a dip. That's what affects us: what's real and what's local."
       
        However, he does say the declining concert market has had a push-down effect that benefits the Ark. "Some of the people who used to play arenas are now playing big halls," he says. "And people who used to play big halls are calling us."
       
        That's helped the Ark offset the toll the sagging economy is taking.
       
        "We've sold out so many shows in the last year, because we consciously book what I would call nostalgia acts. I don't mean that in any insulting way; but we've had people who were popular in the '60s and '70s, out on reunion tours; and they've sold out big-time. We use that to compensate for the fact that some of the the music we really like is going to draw less."
       
        Smith thinks those real-world realities are far more important to folk as a live music than anything else. This is show business, he stresses; it's going to bob up and down. "You can always find things to blame," he says. "When the Red Sox were in the World Series, it hurt us. After the 2004 election, people were so depressed, they weren't going anywhere."
       
        Brad Paul, a Rounder Records executive for the past 24 years, works on radio promotion and video production, among other things. He says the ravenous hunger of the starving pop industry often co-opts Rounder's historic creativity in finding new ways to reach fans.
       
        For example, Rounder was among the first to offer records through the Starbucks Coffee chain, and Rounder jazz chanteuse Madeline Peyroux was one of Starbuck's first success stories. Now, Paul is sadly watching Paul McCartney and Bob Dylan move in to exploit the Starbucks opportunity created by adventurous indie labels like Rounder.
       
        Another thing hurting folk's mainstream visibility, Paul says, is the dearth of what might be called "O Brother" moments: films, or spectaculars like Riverdance, that focus mainstream attention on folk music; and that folk is especially good at exploiting to reach new fans. For example, while the industry largely ignored the phenomenal success of the "O Brother, Where Art Thou?" soundtrack, Rounder quickly released several anthologies of old-time and bluegrass music, like the hugely successful two-volume series, "O Sister: The Women's Bluegrass Collection."
       
        Paul, who also hosts a folk show on WGBH radio, says commercial radio is suffering from the same appetite for sameness that is hurting folk in public radio. It's called "formatics" in the radio biz, and it means having the same sound available whenever anyone tunes in. As a result, even very successful artists like Alison Krauss have trouble getting commercial airplay, because of their folky, acoustic sound. He doesn't see that changing anytime soon, despite how vibrant folk appears on Internet radio.
       
        "What's happening to commercial radio is very analogous to what happened to Tower and HMV, and led to their bankruptcy," he says. "The first thing a radio station will do when it's in trouble is slash its playlist, just as record stores slash their inventories. More labels compete for fewer slots; so when you've got an independent label up against majors with far more resources, who gets squeezed out?"
       
        The smaller Red House Records was experiencing a steep decline a few years ago, until they realized they were responding too much to harsh market realities; and not enough to their own tastes. They're now going great guns.
       
        "As we got more conservative, it got sort of depressing," says Eric Peltoniemi, who succeeded founder Bob Feldman as president, after his untimely death last year. "Nothing about our business recommended expanding, except that hunkering down wasn't getting us anywhere. And we weren't having any fun. I guess we're good potting soil for artists, because all these artists we signed put out very strong records. And that's what affects us the most, we realized."
       
        In short, by turning inward, and focusing on folk's enduring strengths, rather than the music industry's continuing weakness, Red House turned its little ship around, and is sailing as well as ever.
       
        That's a lesson everyone stressed in one way or another. Folk works best when it sees itself as a community, rather than a marketplace; and never before has that been easier to do on a global scale, thanks to the digital revolution.
       
        Sing Out editor Mark Moss says that this era of globalization can also be an era for specialization. A business can serve a small, focused customer base that may be spread over several continents.
       
        "I think there's a real difference between now and 30 or 40 years ago, in that if you have a focused area of interest or expertise, there's more ways to find others who share your passion, and communicate with them," he says. "If I were to set up a folk music store at the local mall, I'd lose my shirt. But we live in a world today where it doesn't really matter if your store is up the street, or a thousand miles away. Especially where something like folk music is concerned, which has an audience that's a little more Internet-savy than the general public, those things become even more true, and important."
       
        As much as it's important to see the global possibilities of folk music today, it's also crucial to remember that this music works best face-to-face, as the profoundly human musical language it has been for thousands of years. Could folk's new global potential endanger its strong sense of localism?
       
        That is a big concern for many folk radio people, who worry that the new Internet opportunities won't feed local folk communities by publicizing upcoming shows, and nurturing new local artists. As Monteith pointed out, when people aren't listening in real time, or are a thousand miles away, it can't help local venues.
       
        Folk Alley is working on an online way to make show listings available to listeners. Performer websites, which Folk Alley offers easy links to, are helpful that way; but Fahey worries that, as the Internet grows, that sense of localism could be damaged. No matter how many opportunities the Internet may provide, there's no online substitute for the local coffeehouse.
       
        "The way I really hope Folk Alley can fit in is as a supplement to local folk shows," Fahey says. "I wouldn't want it to be a replacement, because we can't do what local programming can do for local communities."
       
        Blackman suggests that the best way for local shows like his to thrive in a global arena is to become even more local.
       
        "There's one thing a national and international show cannot provide, and that's a sense of what's available in each community," he says. "There's a significant portion of people who listen to me in part because they want to know what concerts are coming up. But beyond that, when programming is done by people who know who's performing locally - whether they're local or national - and who regularly interact with local fans, a personality inevitably emerges that is pleasing to local listeners - and that they cannot get anywhere else."
       
        What about the CD; is it really in its death throes? For folk performers, selling albums at shows remains a vital, popular, and profitable way to interact with fans.
        "Lately, there have been all these stories about the death of the CD," says CD Baby's Sivers. "The funny thing is, in our corner of the word, CD sales are way up, 30 percent in just the past year. The number of musicians signing up has remained about the same; so it means that, on average, each artist is selling more CDs this year than last. The sales of the Top-100 artists that fuel the big Billboard numbers may be declining; but it's growing at the bottom, because it's never been easier for independent musicians to reach fans. And it's easier than ever to buy something you hear and like. You don't have to go to Walmart and just hope they stock it."
       
        Monteith sees the new technologies making it easier than ever for new fans to find folk music. As a result, it's more important than ever to welcome people who may not be familiar with it.
       
        "Don't be afraid to admit this is folk music," she says, "and take pride in that. We shoot ourselves in the foot on such a regular basis by arguing about what is and is not folk music. Probably a dozen times a week, someone will call and say, 'How can you call that folk music?' But it's always something different; to one caller, folk means more traditional; to another, more singer-songwriter; to another more country, or acoustic, or older '60s stuff."
       
        "But if you want to hold on so tightly to the idea that Doc Watson is folk music that you can't allow that the Indigo Girls are also folk music, then you put it into somebody's mind that we're a much smaller music community than we really are. Sometimes I get so discouraged by people who complain; I wonder if maybe they really don't want to invite people into their little world. They want folk music to only include them."
       
        Over at Passim, Smith finds the folk label invaluable in creating the broadest possible umbrella to describe the diverse music they present; and in suggesting the kind of experience people will have at the club.
       
        "The word 'folk' is useful just to say we're not a rock club, not a jazz club," he says. "You just get an idea from 'folk club' that it's more a space where people get to listen to something, not to drink and vomit."
       
        "For me, it's an umbrella term for all the different genres we play at Folk Alley," says Fahey. "You look at the Americana format, and it's 80 percent stuff that we play - but they don't play a lot of stuff that we do. Other terms just leave too much out."
       
        McCutcheon, and several others interviewed, say this is a perfect time for folk to be trying to reach new fans. Pop has never been less popular; people are craving a more human sound in their music. It is revealing that the top-selling female pop artist of the decade is not some rapper or hip-hop diva, not Britney or Madonna, but the folksy Norah Jones.
       
        "In the '60s," McCutcheon says, "people like Harold Leventhal and Albert Grossman and Manny Greenhill were finding all kinds of ways to turn isolated little strings into strong ropes that artists like Pete Seeger and Peter, Paul, and Mary, and Bob Dylan could use to climb above the radar. What we need to do is some kind of Frankenstein thing, and channel Leventhal's spirit into some 20 year-old, give him a cigar to chomp, and send him out into the world. We could really use some impresarios, with a broader vision of how to reach the masses with this music."
       
        Paul is excited by the young artists he meets, who grew up in the computer age, and believe there's nothing they can't do for themselves. But they also have a deeply grounded sense of community, and a love for folk music, precisely because it is a community music.
       
        "A lot of these musicians are in three or four bands at once, because they don't want to just focus on one thing that drives their career upwards," he says. "They want to build their music in a way that sustains them over the long haul, not just lifts them to stardom. Artists who know how to do that are going to succeed more than ever before."
       
        O'Donovan is a textbook example. Her main band is Crooked Still, but she also performs in her own band, and a songwriting trio called Sometymes Why, with Uncle Earl's Kristen Andreassen, and the Mammals' Ruth Ungar.
       
        "In this generation," she says, "I think we definitely have more options. And people are cooler with making different choices, keeping their lives in order, and their creative juices flowing. For a lot of people, when you're focusing on just one project, you're inevitably going to be cutting back on something else you love to do. It's great to be able to have the means to do different things. You don't have to be just a starving artist on a tour bus, struggling along with your one band."
       
        So does all this self-reliance mean record labels might become obsolete? Hardly, says O'Donovan. While Sometymes Why saved money by self-releasing a CD they made on a laptop computer, she is delighted with Crooked Still's label, Signature Sounds.
       
        "You need a record company to get your record in stores, do publicity for you, get you on the radio, tons of reasons," she says. "You can definitely be successful without one; but for Crooked Still, it's been amazing to have Signature Sounds. They have name recognition, licensing deals with placement firms; and they can get your records onto listening stations. I think having a label can get you out there on a national level."
       
        McCutcheon also stressed the invaluable service that larger labels like Rounder provide in keeping archival albums available, long after their commercial viability has dried up. Rounder has reissued all the Carter Family recordings on CD, as well as folklore legend Alan Lomax's epochal series of field recordings, and long out-of-print works by blues legends like Mississippi John Hurt.
       
        Internet entrepreneurs Panos and Sivers also urge folk activists to think about ways to make it easier for new fans to find the music. Search engines that refine browsing in ways that please both novices and experts, Panos says, may be the next online music wave. And Sivers thinks the Internet is ripe with possibilities for coming up with creative, fun new ways to get folk noticed above the radar.
       
        As one example, McCutcheon suggested that somebody could start an online musical newspaper, offering the latest topical songs from any who wanted to post them, laid out in some kind of  headline form, such as "Cheney-shoots-friend-in-face songs." Imagine the possibilities.
       
        As Panos points out, business models like Sonicbids and CD Baby are better right now at serving music professionals than fans. "That's okay," he says, "because it's natural for professionals to seize these new opportunities first. But it needs to go to that next level, where it's serving the fan just as well."
       
        "What folk needs now, I think," Sivers says, "are creative people willing to market and promote the music in new ways. That's something that will always be needed, and it's something that needs to be done hands-on, because there's no button you can push to capture people's imaginations, hearts, and minds. That's not a career that's going to be replaced by a piece of software."
       
        Sing Out editor Moss said that folk also needs to be mindful of tradition's greatest lesson: passing it along is how art stays alive.
       
        "Don't be afraid of listening to something new, every day if you can," he says. "And of letting that leak into the work you do. I mean, it's simplistic to just say we'll bring young people in. The trick is, how do you get them interested? You go where they are, then invite them to come where you are - and to lead."
       
        "I really think folk is going through a renaissance right now," says Red House's Peltoniemi. "I see all these kids in string bands, playing banjos and singing the Harry Smith collection. I think they're trying to reclaim something genuine in our culture, in the midst of so much that's not genuine."
       
        And that, in the end, may be folk's saving grace, just as it has always been. It is real people's music, folk's music, whether it's coming from an edgy urban songwriter determined to tell the hard truths in song; or a string band plunking out old banjo tunes just the way they used to. Folk music is human - and human never goes out of style.
       
        "I know I sound like an old dog saying this," McCutcheon says with a gentle laugh, "but I think the biggest challenge, while we're learning to master and exploit these new technologies, is that we don't forget this music is interactive - and that when you reach out, you should be actually touching something. We can talk about a folk music community, but unless we're interacting as a face-to-face human community, then we're just a marketplace. One of the things that has been so healthful and sustaining to me over the years is the feeling that I was serving, and being taken care of by, a real community. Folk music is a way to make a living; but it's also a way to make a life."
       
        Originally published in Sing Out! The Folk Music Magazine, used by permission, Sing Out Corporation.