Executives at the big music labels tend to get a bad rap. But some of the most innovative people in the music business began their careers at the labels. Take, for example, Ethan Kaplan, the VP of Product Development at LiveNation.com who used to be SVP of Emerging Technologies at Warner Music Group. Not only is Kaplan an irreverent blogger, but he’s also brutally frank about the failed business model of the music industry.

I caught up with Kaplan last week at the SFMusicTech event, where he explained to me why selling CDs is no longer longer a “sustainable business” and why the “nuclear option” has been pulled on the music industry. The problem with this old model, Kaplan explained, is that doesn’t incentivize anyone except senior record executives. The industry is “finished”, Kaplan explained to me, it “no longer exists.” Kaplan believes that the movie industry needs to quickly learn from the mistakes of the music industry if it is to avoid a similar meltdown. Kaplan’s message to Hollywood is that for the industry to survive, it has to transition from its windowing strategy to a much more innovative way of pricing its products.

At LiveNation, Kaplan doesn’t have to deal with problems of windowing his products. “Live music is always authentic,” he explained. Which may, of course, be one reason why he quit Warner Music last year and moved to LiveNation.com where this innovator is now focusing on designing products that redefine the live musical experience in the digital era.