Billy Corgan Forecasts A Bleak Future For Streaming Music

Billy Corgan went on CNBC earlier this week to talk about the state of the music business, particularly regarding Taylor Swift’s open letter to Apple, and more importantly, Apple’s swift response to that letter. Said Corgan: “Once artists understand the power they have in this marketplace, all heck’s going to break loose … We’re not being paid commensurate to our value to Apple, Spotify, or to anybody. Once the artists wake up, there’s going to be a bloody turf war, and this is a very big sign of what I’ve been predicting.”

Today, Corgan did an interview with the finance site Benzinga to elaborate on some of his theories and potential models. Here’s the takeaway graf:

Corgan explained that, “the music business for a long time, and obviously Apple is in the music business now, it works on leverage.” However, “if 10 percent of the artists that aren’t represented” decide to leave a service altogether, “that would hurt that streaming service way more than a singular artist because” taking an entire contemporary collection of music, such as metal bands, off a streaming service, “that’d be a big hit to anybody.”

I’m a Billy Corgan fan — I loved the last Smashing Pumpkins record! — but I have to point out a few flaws in this argument. First off, it’s not like metal bands can unionize and hold out for higher rates of compensation: Most artists who have signed a record contract don’t retain their catalog’s streaming rights. Also: What Corgan is suggesting is the John Galt approach to economics, and while it may work all right in literature and libertarian campaigning, it’s typically not as successful in reality.

Moving on. Corgan’s next step? Monetize via corporate partnerships rather than royalty payments.

“It’ll be so-and-so music sponsored by Coca Cola. It’ll be Coca Cola putting up the money, Coca Cola will take the marketing, the tech company will take the hardware sales, and the music artist will get paid fair for what they bring to the market in terms of market value … [for example] if you come to, any artist that [Coca Cola] represents, you can listen to their music for free — no commercials, no ads. All you have to do is sign up for Imagine if Coca Cola decides that Beyoncé is part of their next round of marketing. They go to Beyoncé and say, ‘Check this out — if you give us the exclusive on your next album for six weeks, we’ll give you $10 million upfront and we’ll pump the shit out of you — your face will be everywhere. All this free marketing, plus $10 million, all you have to do is give us the exclusive for six weeks.'”

This seems untenable — does Coke have its own player in this scenario? So for six weeks, people can only listen to the Beyoncé record via the CokeMusic app? Seems like a shitty user experience, no? Or do they just got to, offer up an email address, and receive a download code in return? Does Beyoncé have to mention Coca Cola in a song? What if Coke deems the material submitted by Beyoncé to be, I dunno, too explicit, or too political? Just food for thought. Also, as Benzinga notes, Beyoncé signed a $50 million deal with Pepsi in 2013.

Here’s the final point I want to touch on. Says Corgan:

“It’s a social conversation, not a business one. Right now it’s about one artist versus one monolithic company, but honestly, if a trio of artists rose up and said we’re not having it, that might create an even bigger problem. But of course that doesn’t make the headlines in Entertainment Weekly because they don’t know who those people are, but we do.”

Come on, man. A trio of artists? How about 16 of the biggest artists in the world? That was just a few months ago and that shit made headlines everywhere and as of today it hasn’t solved anything.

Still, I love Billy Corgan and I applaud him speaking out. You can read the whole interview here.