Starting May 1st, all Warner albums will be funded by Kickstarter.

Perennially third, the smallest of the three majors saw a need to shake it up, to move ahead of Sony and Universal in the game of music production. Lucian Grainge bought EMI, believing it was all about market share, economies of scale…but that’s positively old school. Today you drill down into the niches, you solidify your relationship with your fan base, you grow from the bottom up, not the top down.

Yes, Stephen Cooper has just thrown a curve ball so wide, Doug Morris won’t even see it.

Believing it’s about radio and retail, septuagenarian Morris is putting himself out to his own pasture. Didn’t he get the memo? Newspapers are dying, young people ignore mainstream media, to try to close young people via old media is like insisting baby boomers give up their Lipitor. Raw stupidity. Then again, the music business was always about muscle.

But now it’s about data.

Lucian Grainge hired Steve Barnett to run Capitol…he’d have been better off hiring a nerd, someone who knows the difference between a 0 and a 1…then again, does anybody in the music business truly know how digital works? I think not.

The nerds have inherited the earth.

And Perry Chen is the new Rick Rubin.

You know, Mr. Vibe. Rick doesn’t really produce records, not in the traditional sense. He just drives artists to capture the zeitgeist. And Perry Chen is riding the wave that Laird Hamilton is unable to get Rick to surf. Rick keeps losing his deal, whereas now Perry Chen is the king of deals.

And the man who executes is Yancey Strickler. Who once upon a time worked at eMusic, before he became one of the Kickstarter troika.

Yancey was in L.A. two weeks ago, inking the deal with Cooper.

You see in today’s market you can’t oversell. Oh, you can try to, but it backfires. You have one hit, and then your career is..sh**. We live in a land of one hit wonders. But even PSY got a couple of months. “Harlem Shake” was here and gone in a matter of weeks. You’ve got to play for the long haul. Something Doug Morris has never done, but Stephen Cooper is doing now.

It’s always outsiders that lead the revolt.

So from now on, every act that raises $100,000 on Kickstarter will automatically get a Warner Music contract. Assuming the act wants it. Which in most cases it shouldn’t, but acts are delusional and want a deal so they can tell mommy and daddy they’ve made it.

But there’s another way to get your Warner deal via Kickstarter. If you get 1000 people to donate, you get a deal too. Since most Kickstarter bands don’t have that many fans willing to pony up the bucks, don’t expect Warner to be overwhelmed with new talent.

As for the acts already signed to Warner?

Cooper’s stealth hire is Amanda Palmer. Unable to get anybody interested in her music other than her hard core fans, Ms. Palmer is now going where her talent truly lies, in marketing, in self-promotion. Her TED speech was just the beginning. Cooper had no idea who Palmer was, but when his niece told him at the seder to check Amanda out, Cooper did and pounced.

Palmer is now wrapping up her musical career, and will be holding boot camps for all Warner artists imminently. Unwilling to spend the dough to fly acts to L.A. or New York, Palmer will go on a bus tour across America, meeting with each and every Warner artist in his or her hometown. The blogosphere will light up with hype. This is the story true fans are following, not Lady Gaga’s golden wheelchair, not what’s on TMZ or Radar, those are positively last decade.

Palmer’s gonna teach all those Warner artists the new reality. That your bond with your fans is all that counts. Build up the hard core. Rip them off for as many dollars as you can. It’s all about the cash, baby. Palmer will teach them how to beg and sell, via Twitter, Tumblr and Facebook, even Pinterest! Finally, Blavatnik’s purchase will pay off.

The labels can’t compete with the promoters. It’s Live Nation and AEG that truly pony up the big bucks. But Cooper is smart, he knows that no act succeeds without fans, and that’s what his new strategy is all about, fans.

The old guard is toast.

Tom Windish has made an exclusive deal to represent all new Warner talent. CAA is too self-impressed, saying it can get acts into movies when we all know it’s about TV and the creators are the new auteurs and can’t be told who to use anyway. All the established agencies are missing the boat, they’re about commissions as opposed to talent development. It’ll be the death of them.

As for sponsorship… It’s toast. Now, the fans will sponsor the acts. It’s a direct connection. Heart to heart. In one fell swoop, Mr. Cooper is wiping away decades of music business b.s. As for the rumor that every Warner act will be given a copy of Clive Davis’s autobiography…that was a plant, by Mr. Davis himself, to goose sales, there’s no truth to that rumor.

But what can Warner do for you, after they’ve signed you?

Well, you do get a free pair of Google glasses. And a Nest thermostat, assuming you’re not living out of your car. But via a secret deal, Daniel Ek will promote you via Spotify. With Jimmy’s MOG/Daisy/Beats Music tied in with Universal, Ek is desperate. But Ek knows it’s all about talent, and he’s lining up with the innovator.

Cooper has also made a deal with Jeff Bezos. Every act will get fifteen gigs of cloud storage and their music will be available to all Amazon Prime members for free.

But it gets even better. Mark Zuckerberg will now allow all Warner artists to spam their entire fan base on Facebook cost free, in exchange for a record deal for one Facebook employee per year.

And five Warner acts, not those already signed to the label, but those who come to the company via Kickstarter, will fill guaranteed slots at Coachella. Expect similar announcements to come regarding Lollapalooza and Bonnaroo. Rumor has it ACL will be excluded, since Austinites don’t like to be told what to listen to.

Yes, what Warner is selling is relationships. Which used to be with radio and retail, but are now with the tech set.

Crowdfunding is here to stay. And Warner is guaranteeing results. If you pledge and the act doesn’t deliver, you get the equivalent of your pledge in Warner stock. If you’re under the age of eighteen, no stock will be forthcoming, but you can choose from the merchandise/rewards of other Warner Kickstarter artists.

Cooper is clueless when it comes to music. But he realizes it’s no longer about focusing on the few, but having a relationship with the many. Why sign a band with no following? Why not go with those who have a start, entice them with perks, and then wait for one of these acts to blow up?

And if they don’t, it doesn’t matter! There was no investment! The fans foot the bill!

And ultimately, in two years time, it’s going to take a while to write the code, Kickstarter and Warner will offer funding for tour buses and all the accoutrements of success. Yes, Cooper is gonna load the entire cost of music development and exposure on the fans. And instead of getting 5%, Kickstarter will get 20% of Warner branded exclusive services.

Just when you thought things were settling down, it’s clear that tech and music are becoming even further intertwined, and it’s those who think outside of the box who will win. If you’re doing it the old way, you’re on the road to failure.

Warner Music is not.