SONG REMAINS THE SAME GRAMMYS UPBEAT WHILE MUSIC BUSINESS IN A WHIRL.

Byline: >>STORIES BY FRED SHUSTER

>LA.COM 

What's the difference between the Titanic and the music industry? A cynic might answer that at least the Titanic had a good band before it went down.

Actually, the quality of the music these days is just part of a chorus line of problems facing the troubled music world.

As celebs prepare to walk -- or in some cases stumble -- down the red carpet at Staples Center tonight for the 50th annual Grammy Awards, the talk is again of a once-thriving industry in free fall.

The latest bad news includes business down 36 percent since 2000, massive layoffs in all corners of the industry, and a dramatic drop in sales in every major genre for the first time. This was the year when record companies realized hip-hop and alt-rock weren't going to pay the piper. The final insult: The biggest music-related hits of 2007 were the video games "Guitar Hero" and "Rock Band."

"It's an industry in the midst of significant transition," says Neil Portnow, president of the National Academy of Recording Arts and Sciences, which hands out the Grammys. "There's still a tremendous demand and interest in music. But it's a matter of a business model being employed and delivery systems developed."

Part of that transition includes moving from the manufacture and sales of hard copies of CDs to new digital services that, with the backing of labels, distribute music by both established acts and new ones, sometimes for free. The move would require a significant change of thinking for an industry that only recently sued fans who illegally shared their music online and companies like Napster that helped facilitate that concept. Another important way music is being sold today is as ringtones, sales of which are as closely watched now as the Top 40 used to be.

Meanwhile, fans were busy showing the most heavily hyped acts the door. Kanye West's latest, for example, hardly scratched the Top 10. New offerings from Maroon 5 and 50 Cent never even managed to trouble the Top 15. And with all the talk about an audience hungry for new challenges, the No. 1 album of 2007 was a Josh Groban pop-opera Christmas album. Meanwhile it seems all anyone's excited about is "High School Musical" and similar kiddie confections.

"Certainly there's been some interesting albums produced, and when you look at the (Grammy) nominations, you see the tried and true and the new," Portnow said. "Long-term artists are still doing well, making the better albums of their careers. And there's a whole new crop."

So, what's going down at tonight's Grammys (which almost didn't happen at all until the striking writers agreed not to picket the show)? West leads with eight nominations, followed by Amy Winehouse with six, and the Foo Fighters, Jay-Z, Timbaland, Justin Timberlake and T-Pain with five nods each.

Here are profiles of three nominees: best new artist contender and r&b newcomer Ledisi, jazz pianist and album-of-the-year nominee Herbie Hancock, and top pop producer Phil Ramone, who's looking at his 34th Grammy nomination, this year for work with the saxophonist Dave Koz.

Fred Shuster, [phone];

[e-mail]

GRAMMY AWARDS

>What: Record industry trophy handout in 110 categories, 12 of which are presented on air.

>Where: CBS (Channel 2).

>When: 8 tonight (tape-delayed).

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Photo:

(cover -- color) 50 YEARS OF GRAMMY GOLD