Over the past couple of years I've been taking a different approach to this question, and so far it seems to be working....
So my approach is to make the gig I want and try not to mind the other stuff — an amateur approach, perhaps, but I'm making a lot more music with a lot less heartburn, and what's really more important? The music culture of 50 and 60 years ago is not coming back, and if we can find a few people who still appreciate what we do in the same space, I don't know that we can hope for a lot more.
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On multiple occasions I have pointed out (and a lot of people don't like to hear this) that the period of roughly 1900-1980 when the United States could support a meaningful number of professional musicians making decent money from performance, was an historical anomaly. Several factors played into this: reliable long distance travel first by railway then by automobile and bus; widely distributed sheet music; widely distributed phonograph records, which however had short play times, relatively poor reproduction quality, and fairly high cost; widely distributed radio broadcasts, but again with short play time, unpredictable programming, and relatively poor reproduction quality; and most important of all, the explosion in social couples dancing in the US that started in the late 1800s and started petering out about 1980.
For 90+% of the past of human music, professional musicians were extremely rare and most music was made at home or in local settings for minimal or no fee.
If you plan to set your sights on being able to earn useful money playing music in a market that's shrinking at an ever accelerating rate, you're signing up to invest in buggy-whip manufacture next to the Ford Model T dealer. There will always be a small number of people who make decent money (note, I'm not even saying "earn a living", just "decent money that makes it worth it ON A MONEY BASIS to leave the house") performing music. I'm not saying there will be none. What I"m saying (and this is a point that some people have trouble understanding) is that the percentage of people who make decent money performing music FOR MONEY is going down, it's going to keep going down, it's going to asymptotically reach some very low value and hang around there, and barring some completely unforeseen total social change, the days of "get some guys together, make a band, work up some set lists, and go make money playing for dancers" ARE GONE.
Now for all of you who read this and immediately start itching to write your three counterexamples, or tell me that "you could do it if you just wanted to hard enough", or try to argue that there will still be some pros out there, it won't all disappear, please READ AGAIN what I've written.
So what does all this mean?
To me, it means that musical performance is in many ways going back to what it was before say 1860. I believe most music performance will be done locally, for minimal or no money, and that eventually this will be understood and accepted. The difference from 1860 is that there will still be "pasteurized music product" produced by giant (probably AI) machines in LA and NYC, and that's what'll be piped into youth boutiques, the putative performers of it will continue to fill stadiums with pre-teen girls to watch and sway along to said pasteurized music product, delivered by beautiful young front-people dressed in not too much clothing and backed by a corps of exquisitely choreographed dancers... yeah, but actual music making is going to be further and further from that experience.
My smart-ass comment on the future of music making is that the Gammas, Deltas, and Epsilons will have a constant diet of mental white-out delivered in the form of this pasteurized musical product, probably all automated in its generation; Betas will get a diet of slightly improved product, maybe with some actual humans involved in it, to mitigate the sameness of the auto-generated stuff; and the Alphas will be going off into the woods with actual instruments and having bluegrass and jazz jam sessions.
So in many ways I'm where Steven is, only I"m not enough of an entrepreneur to create my own scene; but I"m so DONE with scuffling for an ever smaller share of an ever smaller pie, wiht pay rates the same (in devalued money) as they were 40 years ago, and no one cares anyway. I have found that those rare transcendent moments in music making don't require an audience, they don't even require that the people you're making music with be of virtuoso caliber. That's what I'm in it for, that's what I'm chasing, and I've given up the pretense that the money is meaningful.