As always, I take the technological standpoint on how the future of music will change.
I think with the advent of incredibly powerful tools, as well as a super-fast Internet, it will breed into new subcultures that largely create their own music from home, with either free, or very cheap tools. A lot of this musical software that will be created will use very natural, intuitive concepts that the average human can understand (body movements, gestures, singing, dialogue, touch, and even thought processes), and essentially shape the music in the way they want it. This will be, in essence, a supercharged remix culture, whereupon anyone can remix any music, at any time, at their own will. Musical collaborations will appear all over the world, where people can work on music with people across the globe (in different countries, continents, cultures, and even speak different languages), real-time.
Computers will be embedded in every wall, on every device that you can possibly think of. They will be as small as a speck of dust, and literally be cheaper than water (this is called Ubiquitous Computing, for those playing at home). Every surface will be controlled by computers, especially on your musical devices. Simply by going up to a grand piano and playing will mean it starts recording the audio, in higher quality audio than we've ever seen before, with completely invisible microphones. You won't ever have to tell it to record, because it will know you wanted to record. Creating and recording music will be as simple as just playing music. All the parameters will be able to be changed later (as well as the audio waves itself, much like auto-tune, Melodyne and VariAudio can currently do, but with anything).
Music will become personalized, and there will be algorithms to determine what you prefer in music. Each song will be able to dynamically alter (that is, remix) itself based on the listener's feedback loop, changing itself until the listener prefers it. No longer will it be that songs are a linear form, but will instead be dynamic, and constantly changing. As such, every time we listen to music, rather than listening to the artist's exact vision of the music, we will be listening to an implementation of that music. Every implementation of said music will be different, depending on the context of the listener, and the listener themselves.
I see music as being largely electronic, yes. Largely algorithmic, yes. Largely generative, yes.
I see your music following you around wherever you go. The idea of a personalized soundtrack, that algorithmically figures out what you want to listen to, and plays it.
I also see music largely being free, paid for by advertising, done on your phone. Your phone (or personal device of the future, whatever that may be) will be the central repository of this. When you look at your phone, the ads will be based on local musical events, or even premium music that you can pay for. Live music demand will skyrocket, as music fans will be constantly reminded that seeing live music is better than algorithmic music.
As such, there will still be an overwhelming desire to play acoustic instruments (even though they will be able to be perfectly synthesized electronically), and vinyl records will still sell. This is largely based on our primitive, cave-man behaviour where we only inherently trust the tangible parts of our lives.
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So there you go. That's my vision for the future of music production and consumption. I'm doing my part on algorithmic, generative music.