Publishing in the 21st Century

I always found that one of the core features or tasks of a publisher it to spend money made with best-selling artists on the newcomers. This applies both to publishers of music (a.k.a. labels) and literature.

Call it a cross-subsidy (and yell fire if you are too neo-liberal for this).

Over the last decades it appears that this is no longer the case.  

It seems that corporate financial controlling measures are being applied to each author or book of its own (or artist/album), and if it can not turn a profit, it will not be published. Profits from say Harry Potter [1] stay with the Harry Potter team and division and are not invested to find the next promising author.

That's because everyone hates cross-subsidies. Even within one company.

I especially find this is the case in music:

Take the recent rant of Taylor Swift against Apple. She complained (whether rightfully or not) about the fact Apple will not pay the artists during the 3 months trial period, because they, Apple, themselves don't receive any money.[2] Let's for a second ignore whether this is fair or not, let's turn to a separate aspect:

Taylor Swift claimed in her open letter to Apple that she's is not complaining for herself (as she gets enough money) but for the young / indie artists:

This is not about me. Thankfully I am on my fifth album and can support myself, my band, crew, and entire management team by playing live shows. This is about the new artist or band that has just released their first single and will not be paid for its success. ...

So is she asking Apple to take on the role of a publisher? She is asking them to help (i.e. finance) the young artists. Shouldn't the labels be doing this with the revenues they already make?

Interestingly she does not mention that this could be done out of the revenue streams from her music, only from the young artists themselves. That's odd.

So this is only a little less greedy than actually asking for herself - as she claims this is not doing.

Not so philanthropic after all.

Where are the publishers or labels in all of this? By taking themselves totally out of this equation, they will get by-passed in the future. Why would anyone need a publisher, when they don't even fulfill one of their core tasks? What's the value of a label/publisher to a young artist?

Instead of greedily clinging to their old business model, which is falling apart, they should think of creating new and relevant offerings to their customers, i.e. the artists.

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[1] I admit I have done the research on this author/book/publisher, I just use it as an example. Correct me in the comments if I'm wrong.

[2] Apple of course changed this after her open letter.