According to Philip Hayward, the Internet has "offered minor and/or "independent" record companies a (limited, and arguably temporary) opportunity to attract attention to their operation, artists and products by establishing attractive web sites [18]. By August 1998, the World Wide Web 's Yahoo search engine listed around 2,000 labels with a web presence, including the major labels Sony, Polygram, Warner Music Group, BMG, EMI-Capitol and Virgin.

The music industry is notorious for being a cutthroat industry that either consumes or destroys small enterprises, but the advent of the Internet has allowed those with very little revenue or corporate clout to maintain a modest Web presence, and to compete against the major labels in the digital domain. While major labels compete by awarding their web sites more dynamic graphics, increased interactive possibilities, exclusive online sounds and/or videos and special offers, smaller independent labels can exploit niche markets by developing their brand names, to appeal to specific audiences. More importantly, independents are allowed to create a sense of identity among their target groups not offered by the sprawling, multi-genre major labels. A feeling of belonging to a virtual community is still important to many who use the Internet, especially in the music industry's main consumer demographic of Under-35s, and independent labels have always been more successful at achieving cult status in youth culture than the majors.

The Internet allows independent labels to target and cater for these specialised audiences on a global scale without the traditional barriers encountered in the industry, such as struggles for radio and TV airtime, magazine articles/reviews and, more importantly, retail shelf space. Record label web sites are fast becoming self-contained promotional vehicles for recording artists, offering every medium and marketing outlet previously limited to independents. Labels will eventually have their own radio and video stations, label magazines and retail outlets. Per pound/dollar spent, the Internet is by far the most efficient means of promotion for companies on a limited budget, and the most effective means of building and maintaining a world-wide fan base on a scale never before imagined by independent labels [19].

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