One of the greatest driving forces in human progress is the increased mobility of data and objects. The horse. The chariot. The boat. Writing. Currency. The train. Telegraph. Radio. The car. The plane. The space shuttle. The internet. With increased mobility, the price of interaction with others decreases, allowing for increased profits resultant from external investment. Larger and larger social webs develop and strengthen, and here we sit, reading blogs on the World Wide Web.
When nearly the entire planet can create culture and media (the driving force behind "web 2.0") and share it instantly, there is enough out there to satisfy even the most ravenous collector. However, because data can move so rapidly, it becomes ubiquitous. "Spam", or unwanted data, flourishes. Tools which allow people to filter out such unwanted memes become increasingly attractive, which is why we have Google and gated neighborhoods. With the right filters in place, one can "stumble through" page after meme after blog after video after social network devoted to nearly any topic.
As such, niche cultures quickly form. Joseph from Albuquerque, NM used to think he was the only person in the US who loved old B-studio horror flicks. Now he chats regularly with DontGoIntoTheWoods and NailGun1985 over an Instant Messaging service. This has been an absolute boon for independent artists. When the only way to experience music was either going to a local live show, buying a professionally printed LP or listening to the radio, you had to be able to appeal to a wide audience to merit the investment of a record label. The label, then, would print up your record, put out a few ads, send it to radio, and hope that they were right when they thought everyone would like you. When anyone can upload a track they record in their basement with their laptop built-in microphone and a open-source multi-track audio recorder and have it tagged with the appropriate genre-related metadata, the fans can find you.
This is kind of like free trade. The textbook argument for free trade goes as follows: when countries are allowed to trade freely, they will specialize in what they are best at, and trade it for whatever they need. As such, more of everything/better everything is made, and people's consumption frontiers expand. This applies quite easily to creative endeavors: when everyone can make what they're really good at, and find an open market without the big-corporate-studio "tariffs" of entry, people will specialize, the market will diversify, and everyone will be able to consume more, better product. (If you want to know what I actually think of free trade as it is typically meant in current political discourse, you can read some of my other posts, but I digress)
This is why last.fm, which tracks users' listening habits when they install a plug-in on their media players, has charts (MGMT, Andrew Bird, Glasvegas, Rogue Wave, Fleet Foxes) which read quite differently from the top singles on mass-market radio (Beyonce, TI feat. Rihanna, Kanye West, Britney Spears, Katy Perry). To generalize, everyone can listen to and at least partially enjoy Kanye. Not everyone can listen to and at least partially enjoy Andrew Bird. But, with piratebay.org, last.fm, pandora, myspace music, youtube, and the rest of the plethora of online music sites, everyone at least has the chance to know about Mr. Bird should they know how to look.
Now, Mass Media is not going to die. At least not any time soon. But what more and more people are beginning to realize is that Mass Media is not really so massive. Not too many people actually actively listen to Miley Cyrus. People are beginning to find that there's music out there that they like more than what appeals to their lowest common denominator, if they invest a little time, effort, and emotion into it.
Of course, then the resulting question is: where do we go from here? Not to cop-out, but we really don't know. Well, at least we don't know the specifics. But, if we step back and blur the picture a little bit, I think we can expect a few trends to emerge which have really been there all along.