Venture capital is way, way down, and that is forcing early-stage entrepreneurs to completely reframe their startups.  Some music-focused companies are still getting rounds - Pandora, Imeem, Clikthrough, and OurStage stand out - though the bigger shift is towards bootstrapped frugality.

One very early-stage example comes from the New York-based Your Digital Record, a small group aiming to develop a more advanced online album.  Artists can tap Your Digital Record to neatly package music, images, lyrics, artwork, liner notes, and ecommerce partner links into one place.  A portable album widget can then be ported anywhere, embedded into any social network, or emailed, IM'd, or tweeted to anyone.

The concept has cousins everywhere, based on a desire by artists to create a more comprehensive album opus.  An easy example comes from the iPhone app, a tool that allows artists to easily package their content into one bundle.  Elsewhere, Blackberry is soon pushing an app-based package of U2 content, based on the most recent recordings and live performances. 

At present, Your Digital Record is focused on early-stage stuff like ramping artist participation.  " We want to focus on getting some good content first," founder Christopher O'Connell told Digital Music News.  But this is more of a focused feature than a broader company, and according to O'Connell, Your Digital Album will probably fit better into a bigger model (ie, that of an acquirer).  But that discussion could be premature 'in this economy,' at least until the model gets stronger artist buy-in.

Paul Resnikoff, Publisher.