An Internet band (also sometimes called a virtual band or online band) is a musical group whose members collaborate online through broadband by utilizing a content management system and local digital audio workstations. The work is sometimes released under a Creative Commons license, so musicians can share their 'samples' to create collaborative musical expressions for noncommercial purposes without ever meeting face to face.
Internet bands, also known as virtual bands or online band became popular in early 2000s, when music technology, file sharing and collaboration software became more prevalent on the internet, making the technology more accessible. While the amount of collaboration between bands may vary the main characteristics of an internet band is that band members collaborate on music projects via the internet.
The advantages of joining an online band include the ability to collaborate with musicians, vocalists, audio engineers, etc. who reside in any part of the world with internet access. Also, since many online bands do not perform or record in "real-time", it allows members to record their track (their part of a collaboration) at their leisure.
Artists, teachers and record producers
With the development of Internet musicians came Internet session artists, Internet music teachers and Internet record producers. There are numerous people over the Internet that offer teaching services for a fee. Others, often very talented musicians and producers in high demand or people with an instrument that is expensive to gear up to record properly, charge fees for high quality tracks.
Music hosting and netlabels
Due to all of this music floating around on the internet, websites have been established by a variety of organizations to host and distribute this music. There is a large range of different policies, examples being SoundClick, AcidPlanet and goldenflair.
Online music collaboration is an internet based system designed to help coordinate online music projects. Most platforms provide a virtual space to upload recorded music files, a community forum where members cans offer feedback or make alterations to the uploaded music.
Each musician usually needs to record to a click track or metronome and upload the instrument or vocals for the song independently. Then a designated internet music producer can edit for timing and tightness between all tracks, arrange, optimize and mix all instruments together and do a final mastering process to get a complete song out of single tracks.
http://www.ohmstudio.com/ takes this concept one step further and provides a multiuser multitrack software environment where you can record directly into the fully featured DAW (Digital Audio Workstation) without having to manually upload / download files. The software is VST compatible and many people can record at the same time with the results showing up for the other users usually within a few seconds.
Internet-based music collaboration can be done by individuals who never form a permanent band. The Playing for Change Foundation is musical charity that releases music recorded by musicians from all around the globe, only some of who have gone on to play to together live. Even more decentralized collaboration happens between YouTube users; one Cracked columnist praised the cover of the "Game of Thrones" Theme performed by violinist Jason Yang and guitarist and sound engineer Roger Lima and directed by Paolo Dy.
And these people have never met. The Internet isn't just causing collaborations between people who would otherwise never have got together, it's creating collaborations between people who still haven't got together. There's just so much creativity being uploaded that we've reached collaboration critical-mass, where mixes can be generated across the world with nothing but HTTP. The result is a "super-feit" -- a copy superior to the original.
- The ClipBandits, known as "the first internet band," collaborated without ever having met each other, were featured on ABC World News, Good Morning America and ultimately met and performed on the Tyra Banks Show.
- Frozen Coco (online rock band trio, formerly a quartet, hailing from UK, US and Chile; music catalogue consists of 28 tracks)
- Slice the Cake (three piece deathcore band; vocalist living in England, bassist living in Australia and guitarist/programmer living in Sweden)
- Decimated Humans (slam death metal band; vocalist living in Nevada USA, guitarist/bassist living in Australia and drummer living in Maine USA)
- Swine Overlord (slam death metal band from Florida and New York)
- Malodorous (death metal band with several members residing in numerous parts of the USA)
- Infant Annihilator (three member deathcore band; two members living in Hull, UK and vocalist living in Indiana, USA)
- Electric Rats (Blues Rock / Garage Rock internet band from post-USSR (Russia and Ukraine))
- Spicy Folk, with music published and sold globally on Amazon and iTunes work from the UK and USA and formed after having met on an online music collaboration site, ProCollabs.com 
- http://electronics.howstuffworks.com/virtual-band.htm "What is a virtual band?" HowStuffWorks
- http://www.cracked.com/blog/5-music-videos-that-justify-existence-internet/#ixzz2AWxUYQCe "5 Music Videos That Justify the Existence of the Internet" Cracked.com
- Lore Sjoberg, "The ClipBandits — Internet Band," Wired, October 17, 2006.