The good news is it seems that the Free Music Archive will continue; however, it seems unlikely that it will continue to operate as a non-profit.
The Free Music Archive has been sold by WFMU to the company KitSplit. The FMA proved to be too expensive for the ever struggling WFMU radio station to continue to operate. I have not seen a statement from WFMU regarding the sale of the FMA.
Rather than let the beloved project built over a decade by the volunteer efforts of 1000s of musicians, curators, radio DJs, and staffers fall into obscurity, a few worked diligently behind the scenes to find a new host.
KitSplit is a commercial entity with a good cause, providing those on small budgets with audio and video equipment rentals at discount rates. KitSplit gives opportunities to those whom might otherwise be kept from creating their work. It looks like the company is especially supportive of groups who are already underrepresented in audio and film.
KitSplit posted their first statement on the FMA this week, a month after the transaction. They report that they have spent that time trying to learn the workings of the system. It is their hope that ad revenue will help to keep the project afloat.
As this is now to be predominantly a resource for filmmakers to find Creative Commons licensed music, it is unclear whether works released with more restrictive licenses (such as the WFMU license and Creative Commons No Derivatives varieties) will be accepted or even retained.
The future of the Free Music Archive is still unclear, but it looks like it may live on thanks to the 11th hour rescue purchase by KitSplit, a company with good intentions.