Music royalty will gather in Los Angeles on Sunday for the 51st annual Grammys but despite a dazzling star line-up, few big labels are throwing the glitzy after-parties of yesteryear given the recession and industry’s years-long malaise.

Some industry watchers even think the Grammys, which have seen viewership slide, need a facelift to revamp several award categories and change the show’s format to stay current with a generation of fans who have long bypassed mainstream music events.

“The Grammys are looking pretty long in the tooth when you consider the fragmentation of the music culture” said Robert Thompson, professor of culture at Syracuse University.

As usual, the broadcast will be performance-heavy, featuring best album nominees; best new artist nominees Adele and the Jonas Brothers; and veterans such as Paul McCartney and U2.
The night’s top contenders are rapper Lil Wayne with eight nominations and British rock band Coldplay with seven.

The economic crisis is just the latest insult to the music business which has lost its groove and 33 percent in U.S. album sales since 2000 amid a faster-than-predicted shift to digital distribution. But despite all the gloom and doom, the beat goes on. “A lot of people have in the industry have been beaten up in the past few years although the art form is vibrant,” said Mike McGuire, analyst with Gartner.

“We have to find a solution to the economic woes, but this is still a celebration of the artistic product, whether people are buying it or not,” said entertainment attorney Jay Cooper.

 Coldplay’s “Viva La Vida or Death and All His Friends,” is vying in the best album category against “In Rainbows” by fellow British rockers, Radiohead, which bypassed major labels to distribute the album on its own Web site at a price to be determined by consumers. It later released the album through a small label owned by rocker Dave Matthews.

Another indie release is considered the favorite: “Raising Sand,” an acclaimed collaboration between former Led Zeppelin rocker Robert Plant and American bluegrass singer Alison Krauss, while two rappers are also vying for the prize: Lil Wayne with “Tha Carter III” and Ne-Yo with “Year of the Gentleman.”

The album of the year is just one of 110 categories, with prizes to be given out in such genres as country, pop, reggae, bluegrass, polka, blues and spoken word. All but a dozen awards are hurriedly handed out before the main event kicks off at 8 p.m. EST (1 a.m. GMT Monday)

With a slicker format,  more stars and better jokes , “Idol Gives Back” showed just how to stage a mass charity fundraiser on its second outing on Wednesday. 

 Jimmy Kimmel’s roasting of Simon Cowell’s nipples (!!), his haircut (”Who parted your hair? Moses?”) and wardrobe;  Annie Lennox’s emotional rendering of “Many Rivers To Cross”, and Fergie’s  handstands across the stage made it a night to remember. Then there was the “Idol” stage manager who, when she had to come onstage to adjust Brad Pitt’s microphone, admitted: “I just needed a reason to touch him.”

Even Britney Spears — one of the few celebrities not among the more than 60 singers, actors, sports stars and comedians taking part — was reportedly moved to donate.

Life & Style magazine said the troubled pop star — who thankfully has been out of the headlines for at least two weeks — made a $25,000 donation.  “She watched the show and cried for like two hours over the children in Africa with malaria,” a Spears family insider told the magazine.

But just how much did the American public fork over in pledges and donations to the six featured children’s charities in Africa and the United States? Host Ryan Seacrest gave an early preliminary figure of $18 million during the broadcast.

Here’s hoping it won’t be too long before we get to know if the show reached it’s hoped for $100 million target.