"Ron and Dick, I'm getting conflicting messages here.

What's the scoop? ARE the artists receiving royalties? "

It depends. Dick is probably accurate about Smithsonian-Folkways and some of the other services. The performance rights for many of the recordings they release have expired, and as Dick points out - Moses Asch was not in the habit of paying regular royalties anyway.

OTHER download services have paid royalties to the artist, but these are services such as e-folk.com where they have agreements with the artist and/or record label. With e-commerce options, artists can also set up their own websites and offer their own deals and manage their own product.

Dick points out a a very important factor - quality. An MP3 will not sound as good as CD, even at higher bit rates. Most ears won't notice, but it is a factor. Also, consumers are still used to the tactile feel of CD's with artwork, booklets and other information. I feel those days are numbered as processes improve and you can get as much info online, but it takes a while for human beings to alter their own habits and processing.