That guy is a douche bag. The album is not dead. The revenue stream is just changing. In the past people heard music on the radio (where you had to pay a boatload of money to get played), now people hear new music in many places; satellite radio, internet radio, music blogs, services like iTunes saying 'if you like this band, you might like this band you've never heard of', YouTube, etc..
People with similar interests are able to connect better than ever before. More niches are emerging than ever before.
Everybody knows record companies are dated. Artists don't need them anymore.
To sum it up; it's the long tail. The tail is just getting longer and longer, and artists that sell a huge volume are getting less of the overall pie.
