Both axes, on display at CES’s gaming showcase, are MIDI guitars that also work as controllers in Guitar Hero and Rock Band. They’ve got actual, strummable strings for your picking hand and plastic frets that respond to the touch. Along several frets, there are also color-coded bars, marking them as buttons for music gaming.

I’m a guitarist and a gamer, so I couldn’t wait to give You Rock’s capable hired musician a rest and to try both guitars on my own. One thing’s for sure: Playing Guitar Hero on these instruments was considerably more fun than using the actual game’s paddle-and-buttons guitar controller. Being able to jam on strings brings the experience closer to real life (but still pretty far off, of course).

Playing the guitar wasn’t half-bad either. You definitely lose some important abilities, like bending strings and full control over muting, and it takes a little getting used to, but I was able to kick out some blues without too many problems. I actually preferred Gambridge’s guitar as a musical instrument, as it felt more responsive to muting and sliding, and its frets have a little give, making them feel more like real strings. But it’s heavier and its design isn’t as sleek.

It’s probably a good thing that there are two companies pursuing this, because it increases the chances that the product will get to market. The $179 You Rock guitar is available for pre-order online with ship date unknown (you’ll also need a $25 Bluetooth dongle for your game console of choice, available in Q1 for Playstation 3 and Wii and Q2 for Xbox 360), and the company is hoping to land retail deals at CES. Gambridge is shooting for a September launch with the $199 Z-1, whose prototype works with the Playstation 3 only (Gambridge eventually wants to support all consoles) via wired USB.

Would I buy one? Maybe, as the ability to use these guitars as instruments in Garage Band sweetens the deal if you’re an actual musician, but if I was looking to teach a Guitar Hero enthusiast how to play, I’d probably opt for a cheap starter electric guitar instead.

Update: I’ve clarified that the You Rock guitar can mute and slide strings, but it felt a little more natural on the Z-1 in my brief time with both.

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The station is “finally on safe ground with a long-term agreement for survivable royalty rates,” Pandora CTO Tom Conrad told TechCrunch today. SoundExchange, which collects royalties for rights holders, agreed to a 40 percent to 50 percent reduction in per-song-per-listener rates in exchange for 25 percent of Pandora’s revenue, through 2015.

Notably, that deal is good for other Internet radio stations, so Last.fm and Slacker could also benefit from the agreement.

Some users will end up paying for this change. Anyone who listens to Pandora for more than 40 hours in a given month — that’s roughly a tenth of the user base, says TechCrunch — will have to pay $0.99 cents to keep listening. The premium Pandora One service won’t be subject to the additional charge.

Given that Pandora can get a little repetitive after extended listening, the 40-hour cap is a small concession to make, and even then, a dollar ain’t much. Besides, my sense from other Pandora users is that they’re so enthralled with the concept that tiny trade-offs don’t bother them. Little reminders to click on the player window and an occasional ad are minor inconveniences, well-traded for a virtual DJ that knows all about your musical preferences.

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A new study by The NPD Group found that Twitterers purchase 77 percent more digital music downloads than other Web users. Put another way by NPD analyst Russ Crupnik, “Twitter users are simply worth more to record labels and music retailers than those who are not using Twitter.”

Not that NPD’s research is all great news for the music industry: Only 23 percent of Web users bought a CD in the last three months, and 16 percent said they bought a digital download. At least there’s a silver lining in the habits of Twitter users, 33 percent of whom bought a CD and 34 percent purchased a music download.

Is there something in the atmosphere of the Twitterverse that beckons the sweet sound of music? Perhaps not; correlation doesn’t imply causation, of course, and NPD avoids suggesting that Twitter is breeds more music buyers.

What NPD does suggest is that Twitter is fertile, yet delicate, marketing ground for the music industry.

“There must be a careful balance struck between entertainment and direct conversation on one hand, and marketing on the other,” Crupnick said. “Used properly Twitter has the power to entertain — and to motivate music fans to purchase more new albums, downloads, merchandise, and concert tickets.”

It’s not clear how the music industry can get on the ground floor of such an operation. There are already plenty of options for sharing music through the service, and none of them are discussed in NPD’s press release.

If the music industry knew which external services were helping generate sales, maybe record labels could help those sites flourish. That’s a better strategy than suing everyone, at least.

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Robin Pecknold, who is the lead singer of the band “Fleet Foxes,” told the BBC that file sharing helped him discover music that inspired him–music which he may not have otherwise heard. “As much music as musicians can hear, that will only make music richer as an art form,” Pecknold told the BBC.

I can’t argue with him (well, aside from the stealing part). The Internet has revolutionized music discovery. It is shocking that the music industry never envisioned that broader exposure to music through the Web could yield some positive developments. Where were the music lovers in the business when the industry stood opposed to the Web?

Don’t get me wrong, something had to be done about Napster. There was a substantial loss of intellectual property happening, and piracy is not excusable. However, there was another way: The industry could have embraced the medium instead of going to war with grannies.

That tactic has been successful before. DVDs are a good example of copyright holders working in partnership with technology companies. It’s an obvious conclusion, but the music industry has made some major missteps with how it has handled the Web. Maybe the pirate artists will help save it.

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Following in the footsteps of CDBaby, but with a crucial difference, TuneCore and Amazon will launch an on-demand CD printing service, Wired’s Eliot Van Buskirk reports. The musician pays $31 per year for printing, labeling and delivery of a 10-track CD. Amazon sells the CDs for $8.98 each and keeps 60 percent. The rest goes to the musician.

In terms of keeping a low barrier to entry, CDBaby and TuneCore’s services are fairly similar — I could break down the differences in price and process, but I’m sure things will change once the two companies start competing. The real distinction is the muscle TuneCore brings to the table. Buskirk notes that Trent Reznor, Keith Richards and Joan Jett are already clients of TuneCore for other digitial distribution services, and they’ll likely be itching for yet another way to escape the major labels. With TuneCore, they only have to sell nine CDs each to break a profit, and they keep all the rights to their music.

Not that online printing is without drawbacks for consumers: The immediacy of purchasing a CD in a store is absent, and so is the chance to own something with elaborate packaging, as TuneCore’s liner note options are a fairly standard set of sleeves and inserts. Buskirk also raises the issue of selling CDs at a concert, but I don’t see why the band itself couldn’t order a thousand copies and sell them for a premium at the show.

Paramount to all this nitty-gritty is the not-so-novel idea that the music business as a whole is decentralizing. The cleverest musicians, big and small, are finding ways to advertise and sell products without major labels. Meanwhile, entrepreneurs are capitalizing in spaces where the music industry was too big, dumb and slow to venture.

These monoliths will shrink, and companies like TuneCore will be the catalysts.

Update: So we’re all clear, TuneCore’s Peter Wells, who comments below, breaks the pricing down in an e-mail as 19.98 for a year of maintenance and storage of the physical CD, plus 99 cents per song, plus a flat fee of 99 cents to sell the album through Amazon, totalling roughly $31. An extra dollar distributes the song to iTunes as a digital download.

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Setting out to tackle this problem with a study of sustainable CD packaging, the Recording Industry Association of America and the National Association of Recording Merchandisers offered up an interesting possibility: Buried deep in the 66-page report (PDF), released this week, is a suggestion to sell carbon offsets to individual consumers.

The study notes that Orbitz (and now Expedia and Travelocity) offer a similar option to their customers. The price of the offset is added to the bill, and the money goes to creators of sustainable energy and other eco-friendly causes.

In the music industry’s version, a customer could either buy a credit online or at a retail store when purchasing the CD. For incentive, the report talks of “exclusive access to merchandise or special offers.” Digital downloaders could get in on the act as well, as online music also carries “significant environmental impacts associated with running download servers and maintaining IT infrastructure, in addition to the amortized impacts of CD recording and production,” the study says.

As recently as today, Washington is considering a cap-and-trade program that would likely apply to CD packaging. Loading some of the burden onto the consumer would take pressure off the recording industry, but it runs the risk of guilt-tripping customers. Hopefully the incentives offered by the record labels would make carbon offsets feel more like a partnership than a way for big business to dodge taxes.

Of course, all of this is theoretical at the moment. I’ve called a spokesman at the RIAA to ask where this initiative stands, and I’ll post the response if it comes. Update: Okay, this came in pretty much immediately after I clicked “Publish.” Spokeswoman Cara Duckworth said the study is analysis and advisory. “It’s up to each company to determine what best works with their individual business plan,” she said.

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In a scathing, profane forum post, frontman Trent Reznor said the objectionable content resided in music from NIN’s “The Downward Spiral” album. If you’ve ever heard the tune “Closer,” you can probably imagine what lit up the censor button.

These songs could just as easily corrupt virgin ears through iTunes, except that the iTunes Store has parental controls. It’s high time the App store added similar functionality, if only so adults capable of withstanding the occasional f-bomb won’t be subject to draconian censorship.

Such a feature is on the way with the iPhone’s 3.0 operating system, and rumor has it that apps with explicit content may have a better shot at approval. iLounge reports that one developer, Makayama, heard as much when its Newspaper(s) application was blocked for including The Sun, a British paper notorious for including a naked centerfold in each edition. In a rejection notice, Apple reportedly said it “would be appropriate to resubmit your application for review once this feature is available.” (Makayama instead removed The Sun and successfully resubmitted the program.)

We’re still waiting on an official release date for the 3.0 OS, but it’s losely scheduled for this summer. In the meantime, Reznor has no plans to ditch the iPhone (though he may take nin:access to jailbreakers) because “nobody has an Android phone,” Blackberry has “inconsistent” hardware and “WinMo straight-up” um, does not meet his quality standards. (We have self-imposed parental controls here, Trent.)

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The relaunched Yahoo Music intends to become a “starting point for music fans,” according to the press release. The logic goes that curiosity or love for a recording artist will compel you to visit the artist’s page on Yahoo Music, which acts as a content hub. Widgets, or “modules,” can be added, removed or moved around the page for each individual viewer, allowing you to nix iTunes if Amazon is your preference and dump Pandora if you prefer Last.fm. There are modules for YouTube and Rhapsody as well.

Yahoo Music currently hosts 500,000 artist pages, but down the line, the company wants to open artist page creation for any musician or record label. That sounds like an ambitious undertaking, but it could work well for indie bands with enough devotees.  A spokeswoman tells me that other modules will follow, such as online merch shops. CNet says this is all part of the company’s “Open” strategy of adding third-party features to its existing Web services.

I poked around the old Yahoo Music site today, and actually enjoyed its current form. The listening limit on the embedded Rhapsody links are a downer, but otherwise the site was clean and easy to navigate. Hopefully, the addition of extra modules won’t clutter the screen or grind down on my poor little netbook.

My other concern is remembering to visit when my first instinct for any curiosity is to plug a search into Firefox’s Google toolbar. Yahoo searchers will find the stuff easily, but it’d be really great if Yahoo Music could get enough Google juice to land on the front page of those Web searches, above or near Wikipedia. That would probably be too friendly.

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Unfortunately, the service had some serious usability issues, such as limits on playlist size and a slow music player, and the song selection wasn’t comprehensive. Courtney Holt, who stepped in to lead MySpace Music in January, three months after launch, is candid about the problems in his chat with Wired, calling the original service “plumbing and a playlist.” He covers similar ground as he did in a New York Times Bits interview from March, when the service started adding new features and improving the interface. Perhaps Holt is trying to get the word out that MySpace Music isn’t all bad anymore.

And for a free service, it could be worse. The ability to search for bands and build playlists directly from the results is nice, and I like the pop-out player. I’m wondering why playlist management is stunted — it can’t be done in real-time and new songs add themselves to the top of the list, rather than the bottom — but as a tool for discovering new music, it’s functional enough. Links to the Amazon MP3 download for each song are enticing, too.

Holt is also looking to “bring back the album,” as Wired puts it. Entire pages will be dedicated to individual albums, packed with bonus features and a forum for fans to discuss the music. With greater support for indie bands, MySpace Music is starting to look pretty robust.

If I were the record labels, I’d be looking to duplicate this service on other social networks. Design-wise, I’ve always found MySpace to be sloppy, and that’s keeping me away more than the content or the way it’s managed. Obviously adding streaming music to my network of choice (Facebook) can’t happen overnight, but I’d much rather get two dozen streaming track recommendations from friends than read 25 of their obscure personal details.

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Posts began unceremoniously in late February with a few Pet Shop Boys videos (kudos to Wired for picking up on this now) and continues along at a post or two per day, with sporadic days off. On its face, the blog looks like any other site dedicated to the latest music happenings. There are announcements regarding a variety of groups — the text doesn’t explicitly mention that they’re all EMI bands, but they are — and embedded links to music videos. Today, there’s a post on a really interesting demo package that showed up at the A&R office.

The bloggers seem open to hearing about unsigned bands, too; a box at the top of the screen encourages readers to send tips, and promises to sign groups that the staff really enjoys.

Scanning a couple pages, I quite like the relaxed and open feel of the blog, and that seems to be the point. “As far as we can tell, we are the only major label with this level of openness about who we are and what we do,” the blog’s About page reads. “We hope you respond to that with openness of your own.”

Indeed, the music industry is often stigmatized as a bunch of cold, careless suits. Whether or not music industry blogs such as this can translate into sales is up for debate, but the young, smiling faces of the In Sounds staff are, at minimum, great PR.

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