There's something new happening in the music world that might actually help bring a reluctant record industry into the 21st century.

Six retail chains are teaming up to offer customers digital music, both in their stores and over the Internet. The six -- Best Buy(NYSE: BBY), Hastings Entertainment(Nasdaq: HAST), Tower Records, Trans World Entertainment(Nasdaq: TWMC), Virgin Entertainment, and Wherehouse Music -- will operate through a joint venture called Echo.

Why might this be revolutionary? For one, the record labels have been extraordinarily inept at offering consumers a viable alternative to Napster-like download sites, such as KaZaA, Morpheus, and WinMX. Sony(NYSE: SNE), Vivendi Universal(NYSE: V), AOL Time Warner(NYSE: AOL), EMI(NYSE: EMI), and BMG have all tried to get music lovers who want to listen to songs on their computers and MP3 players, or who want to burn their own CDs, to pay too much money for too little in return.

Echo, on the other hand, has some advantages over the labels' offerings. For one thing, consumers will be able to download music piecemeal, without a subscription. Echo will also market to consumers in stores, and it has the ability to combine traditional CDs with digital downloads in creative ways. "I might buy a Sheryl Crow album, and then get two or three more downloadable bonus tracks for free," Yankee Group analyst Michael Goodman told Forbes.

Finally, the labels face tough regulatory issues. While some have teamed up, it's not feasible for the entire industry to get together and set prices. Yet Echo, run by retailers who will set prices independently from each other, has the potential to offer music from all labels.

That brings us to this story's big catch (and you just knew there had to be one, eh?): Echo still needs to work out licensing agreements with the labels, and total success is no sure thing.

Common sense says the labels should see the potential of Echo (it can offer consumers something they might actually pay for, and it might be a partial answer to the rampant pirating on the file-swapping services) and deal in good faith. Yet the industry -- spearheaded by the Recording Industry Association of America (RIAA) -- has been extremely reluctant to embrace common sense when it comes to this issue. Perhaps Echo will change all that.