I agree in some ways with what you say, and it ring some of my own bells, but i would like to dig on one point i disagree with :
> In a free model there isnt any point in marketing the band
Why do you think this is the way, i would have said, quite on the opposite side , that promotion is the beginning and end of the free model, to make the only substantial income you have (gigs) worthwile.
Also, the reason i see this in a positive way is because, i personnally have very little esteem for the actual beholders of the music market, wich in my opinion, has a very conservative way of gauging the quality of music.
In fact, as releasing Cds is very expensive, and as we're talking about often multi-billion dollars companies, you see a phenomenon wich reminds me of the videogames industry, in wich you'll settle on very well known recipes that are proven to work. The amount of innovative stuff that reaches the mainstream is very very low. You could say that it is, by definition, but i would argue, and that's very subjective, that even some of the hits of the 80s wouldn't have been released by todays Record Companies standards , wich has never been so conservative.
Especially in artistic matters, quality can't only be gauged by the amount of stuff you're gonna sell, and even if it's a criteria, it shouldn't be the only one IMO. The generalization of music sharing on computers allows the growth of a much more liberal ecosystem here, and i think it's really for the better !
The question of wether people should be 'allowed' to think about music as a free thing, (in short , morally abbrogate copyright) isn't clear to me. Intellectual Property is one of the biggest foundation of today's economy. Questionning it is scary. I don't know if it should disappear in artistic matters, but i surely think it's a question we have to debate today.
We have a very important position in this, as the Open Source 'movement' is maybe the precursor of such conceptual trends. I think we owe to ourselves and to our peers, as hackers, to ask ourselves, and to question the facts deeply about these matters.