From the NYT:

In 2005, Starbucks looked like it was going to do for undiscovered music what it had done for the nonfat latte. The company decided to stock “Careless Love,” a CD of sophisticated pop-jazz songs by Madeleine Peyroux, who had attracted only a modest following in this country, plying her craft in small bars. Ms. Peyroux soon found herself at No. 81 on the Billboard chart, and has become a mainstay of jazz.

Starbucks was betting that its eclectic taste played to the upscale atmosphere of its coffee shops, where it enticed customers to pay $4 for their daily caffeine fix. And record companies saw Starbucks at the vanguard of a new class of unconventional sales outlets that could keep the CD alive in an age of digital downloads.

But the ardor for Starbucks has gone the way of yesterday morning’s grounds. Critics in the music industry say the company squandered its cachet by mismanaging the effort to broaden its music mix. The choices that reflect its early taste for the offbeat — like an album from Lizz Wright, a torchy pop singer — are now squeezed in with offerings not unlike those at Wal-Mart, including the latest releases from Alicia Keys and James Blunt. The shift has not been lost on some customers.

The music offering “is more popular now,” said Hazel Delgado, 33, a social worker and Starbucks regular from San Bernardino, Calif., who attended a recent concert presented in front of one of its coffee shops by another act on the company’s label, the singer Sia. “I want to come in and be surprised,” she said. “If they do get more mainstream, why bother?”