Just what, exactly, are all those Hollywood types getting in return for their investment in Barack Obama’s presidential bid? The Justice Department, a steady ally for the entertainment industry on copyright issues during the Bush administration, today opposed the studios in a potentially precedent-setting dispute with Cablevision over TV recording services.

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Are iPods changing our perception of music? Are the sounds of MP3s the music we like to hear most?

Jonathan Berger, professor of music at Stanford, was on a panel with me at a meeting of the American Academy of Arts and Sciences in Mountain View, Calif., on Saturday. Berger’s presentation had a slide titled: “Live, Memorex or MP3.” He mentioned that Thomas Edison promoted his phonograph by demonstrating that a person could not tell whether behind a curtain was an opera singer or one of Edison’s cylinders playing a recording of the singer. More recently, the famous Memorex ad challenged us to determine whether it was a live performance of Ella Fitzgerald or a recorded one.

Berger then said that he tests his incoming students each year in a similar way. He has them listen to a variety of recordings which use different formats from MP3 to ones of much higher quality. He described the results with some disappointment and frustration, as a music lover might, that each year the preference for music in MP3 format rises. In other words, students prefer the quality of that kind of sound over the sound of music of much higher quality. He said that they seemed to prefer “sizzle sounds” that MP3s bring to music. It is a sound they are familiar with.

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Last year, here on the Voices blog, I asked you all for your thoughts on how to finance and put out my next record. I got some swell advice, as well as some good wishes. Many agreed that the patronage system–asking fans to donate money–was a promising idea.

I really had no idea if I would make it, or end up embarrassed with just my mom donating at the “polished rock level.” By the way, the polished rock level (free early download) was $10. But you could donate all the way up to “weapons-grade plutonium” ($10,000), where you get to sing a duet with me. One businesswoman from the United Kingdom, named Jo Pottinger, flew in last month to sing and, honestly, did a bang-up job.

So, how have I spent my money so far? Well, I got production help from my pal Don Was (The Rolling Stones, Bob Dylan, Willie Nelson, Bonnie Raitt). He got me a great rate at the old A&M studios (where Carole King did “Tapestry,” Joni Mitchell did “Blue” and where so many of my favorites recorded). Normally, I would never be able to afford to record there.

He also hooked me up with some of my favorite old-time session players, like Jim Keltner, who played on all those Beatles solo records. We recorded old-school and played live with not much overdubbing–and that includes the vocals.

I wanted to have the energy and looseness of some of my favorite childhood records, before everything got so quantized and auto-tuned. And because of that, we did it really fast.

Oh, I have also booked a day where I will sing and play guitar on 10 songs to a click track. My idea is to release it with the audio files so that people (pro or amateur) can put the tracks on their garage band or pro-tools and mix, produce and deconstruct the songs as they see fit. Thinking of having a contest for the best production.

So, now that I have spent a little more than half my budget on recording, plus another $10,000 on various stuff (donation prizes, Webmaster fees, the PayPal percentage, iPhone apps), I have around $25,000 left to play with.

I still don’t want to license the record to any of the labels. But now I have to figure out how to do all the things they traditionally do (distribution, marketing, publicity) and take advantage of the opportunities with new media (which they have not been so great at).

There have been more than a few companies that have come to me with their new paradigms for how to make money in this digital age–mostly how they can make money. I am trying to look at all of them (some do sound sort of promising and intriguing).

Oh, and I still want to have hard copies available too–I have a friend who will make a mini graphic novel that would include two pages for every story (song).

So here I am, asking you smartypants AllThingsD.com people for ideas. You do seem to know more than most in the “industry.”

By the way, I reopened the Jillsnextrecord site recently, upon request, for those who told me they wanted to donate and have their names in the liner notes (or sung in a song). If any of you are interested–and I’m just saying–it will still be up until we go to the printers in a week or two.