In music, coda signifies the concluding movement of a piece. And that's exactly what Time Warner (NYSE:AOL) is considering as it looks to hand over its struggling Warner Music label to EMI (NASDAQ:EMIPY). According to yesterday's UK Times, EMI has made a $1.5 billion offer for the Time Warner subsidiary.

After three years of declining CD sales, enough is enough. The five major labels may soon become four -- and possibly only three, if Vivendi (NYSE:V) finds a buyer for its Universal Music division.

Yes, it's not just hungry indie artists who want to sign record deals these days. The labels want to sign off on contracts, too: exit strategies.

The EMI deal, which would be paid mostly in cash, would help Time Warner reduce its debt load and also stem off the fiscal drain of an industry with no real turnaround in sight. More than 60 million people are reportedly downloading MP3 song files for free and even now as the industry turns litigant, there are few guarantees that the file swappers will come back as buyers. Even online specialists like RealNetworks (NASDAQ:RNWK) and Roxio (NASDAQ:ROXI) are starting to realize how frustrating it is to be a purveyor of music.

But there is value in the Warner Music library. Between Madonna, Linkin Park, Missy Elliott, and Red Hot Chili Peppers, the label has an enviable roster of artists. It's only a matter of finding ways to monetize musical distribution in a new age that values a blank recordable CD over a prerecorded one. That won't be an easy task.

You can't blame Time Warner for wanting out. But if EMI -- or any other remaining label -- ever finds a way to make it work, this will be a time when garage band Picassos change hands at garage sale Picasso prices.

First, Time Warner drops the AOL name. Now, it might be looking to shed its music business. Is Time Warner doing the right thing? Are the days of the diversified entertainment conglomerate coming to an end? All this and more -- in the Time Warner discussion board. Only on Fool.com.