Billy Corgan: Artists Are Constantly Being Told They Have No Value…

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Billy Corgan, speaking on CNBC’s ‘Post 9’ this morning…

Corgan: The music industry is mostly run by feckless idiots, who do not subscribe to the normal tenets of capitalism. Which when they do, the business tends to work out well, stars rise to the top, everybody benefits.  But it’s still a parochial business that’s run by fiefdoms, way behind the times technologically.  Other companies, the tech world is just blowing music out of the water in particular.

But, music artists in particular remain incredibly valuable to launching things, hence tech companies keep cycling back to music artists.

And music artists need to figure out their true value in a free market society, which they’ve been slow to do because you have that old model of telling artists that they’re not worth anything, that they’re disposable.

Similar to what you’ve seen in the sports leagues, you’re gonna see that evolution now happen finally in the music business.

CNBC Host: So Billy what do you think of Tidal, because it seems to me like this is Jay-Z’s attempt to swing the pendulum, to get the artist some more power.  That’s the way he’s talked about it, to slice the pie differently, and to get higher quality music out there, because it seems to me we’re in an era where it’s easier than ever to get low-quality bad music, and somebody’s got to push things the other way.   Or do you agree with his approach here, what should we do?

Corgan: The problem is, is that, although I celebrate the idea of him creating his own model, it leaves a lot of people out.  And so at some point, you have to have winners and losers because that’s the way it works.  So to try to sell it as an overt, altruistic thing is disingenuous because it’s not.  He’s taking his slice of the pie, which he has every right to do, he’s a powerful man and he works with powerful people.

But by the way I’m a powerful artist and I don’t remember getting a phone call from him, but I get phone calls from other people and I have to make similar decisions from the other end.  But to sell it as altruistic, I don’t buy it.

CNBC: But as we see more competition, more people like Jay -Z trying to get into the game.  How much more fragmented can this market be, as everyone fights over licenses, exclusivity —

Corgan: Wild West, Wild West, you’re going to a complete disintegration of the business model, and the reforming.

The problem is artists, because they’re generally sort of manipulated, it’s just an old business model of the music business, you’re told constantly ‘you have no value, you have no value,’ they’re slow on the uptake on how much value they actually have in this marketplace.

Because when it comes to athletes and rock stars, or music stars, those are two people that can sell a level of independence that works with marketers that nobody else can sell.  Hence, the quarterback for Green Bay, he does the ads —

CNBC: — Sure Aaron Rodgers.

Corgan: — that’s the world we’re entering into, but music’s been slow on that, because the old music business continues to try to control their little diminishing share on the market.

CNBC: So when you say that they have ceded leadership to tech, are you talking about Apple?  Are you talking about somebody else?  A consortium of companies?

Corgan: I wouldn’t make it specific to Apple, because I just think it’s sort of like, music at one point had their whole world stitched up, they had their manufacturing, they had the distribution, they held the conversation.  Okay, if you really want to look back is when they ceded their power over to MTV.  When they let MTV build  a network on their juice for free, and then eventually kick music off the channel, and still call it MTV, right there that’s the tipping point.

And so tech is really just coming in at the wake of  what was the MTV version.

CNBC: So today is that YouTube, is that VEVO, who takes over that role?

Corgan: Hard to say, I know what you’re saying but it’s hard to say, because honestly I believe it’s Wild West now.

CNBC: So why would we get actors here at Post 9 saying ‘we’re in this golden of television and movies with distribution, and there are so many possibilities to open up’…

Why has that not worked for music, and is it possible to change the script somehow to get music back to value?   Do you have any insights into that, based on the other things you’ve got, you’re into wrestling, you’re into so many other forms of entertainment.

Corgan: Thank you for mentioning, I’m an executive with TNA Wrestling, God bless.  The problem is that there’s not enough money in music as a business model.  Where in television and vis-a-vis the advertisers and movies, there’s so much money that the controlling forces still circle around the stars in the right way, stars are taken care of better in those industries.

In the music industry it’s still very much this exploitative thing, it’s still very much people signing their lives away, the old deal-with-the-devil stuff.  That is still going on, it’s unbelievable in this day-and-age that this is still going on.

CNBC: Last question on touring, the narrative’s been written that all the money’s in touring, you gotta tour if you’re going to make any money at all —

Corgan: — don’t buy it.

CNBC: — you don’t buy that.  And you say that touring is frustrating because it’s all about the old stuff!


Who just made $3 billion for selling headphones?  The future for music artists is in brand identification.   Music will only be — excuse the French — the lubricant to make the bigger deal.

The bigger deal will be ‘I represent my company or I represent my brand’.  And once you saw that deal made, it’s over.  The old model of selling plastic is over.

And by the way, I don’t remember getting any checks for selling computers and telephones, but I’ve helped sell a lot of computers and telephones, as have a lot of other music artists.

At some point the music market is gonna have to come around and pay those artists what they’re worth, or they’re going to do what Jay-Z is trying to do, break off and make it his own deal.

22 Responses

  1. Anonymous

    Say what you want about his music, but Billy Corgan has always been possessed of a very smart mind.

    • Remi Swierczek

      Concluding with feckless idiots and fiefdoms in single paragraph makes him brilliant observer of music industry!

      Still how do we solve the problem, so Rio doesn’t create another VEEVOO music incinerator with full blessing of Lucian Grainge and Doug Morris.

      To avoid politics let’s transfer Doug to Warner, Lucian to Sony so UMG/ Vivendi can be taken over by Google.

      $50B Google as a hub of $100B+ music industry is much better streaming away $100B of music goodwill to $25B muddy puddle of subs and ads!

  2. obama

    artists have no value! at least 99,9% of them! :-P

  3. Anonymous

    “Artists Are Constantly Being Told They Have No Value…”

    Meanwhile, in the real world: Big Tech doesn’t have any value.

    Remove your music from Spotify, Pandora and YouTube and see what’s left…

    • Jeremy

      A bunch of music services with large catalogs minus your band that nobody’s listening to anyways?

      • Anonymous

        No — Ek, Westergren and Schmidt trying to sell t-shirts.

        And good luck with that.

        • Me2

          Sshh. Don’t you know how much money you’re leaving on their table?
          Good thing no one is listening.

  4. Name2

    Meanwhile, Corgan’s touring with something called the Smashing Pumpkins. Lineup is all new, and totally coincidentally includes an Asian and a chick.

    What’s that about value and replaceability, again????

  5. Troglite

    Great interview. I disagree with one aspect of his analysis, however. I believe the primary reason that video has avoided many of the challenges that the music industry continues to struggle with is technical in nature. Video files are much larger then audio files. As such, the technical revolution we commonly refer to as “The Internet” impacted audio first. This allowed the motion picture industry to learn from the mistakes made by the major music labels and distributors. IMHO, the primary mistake was greed. Instead of disrupting their own business, the music industry tried to delay or avoid change by clinging to their traditional areas of control (distribution, marketing, and finance). As we all know, that strategy failed miserably. As this interview points out, this is still their primary strategy (buy a stake in every distributor, use financing to manipulate and control the content creators, and use marketing to shape demand). Conversely, I see NetFlix and Hulu as signs that the motion picture industry has made an effort to avoid this fate by applying lessons learned from watching this play out.

  6. Jared

    Go work at Subway and you can be a Sandwich Artist®!

    • Another gentlesir

      Starbucks is also hiring artists. If you want to make money you’ll shouldn’t have flunked out of algebra. Learn2STEM. #STEMMasterRace

  7. Stark Hazard

    Good article Paul Resnikoff thank you.

    • danwriter

      Just to be clear, it’s not an article — it’s a transcript. With analysis — some of which is pretty astute — from the peanut gallery.

      • Bad News Barnes

        Agreed. The first decent read I’ve had on this site in weeks. I suggest you also read the interview with Lefsetz on Wisdom is breaking out all over… well, common sense anyway.

        • Name2

          Sentences I never finished reading….

          I suggest you also read the interview with Lefsetz …

      • Stark Hazard

        ARTICLE [ahr-ti-kuh l] noun 2. a piece of writing included with others in a newspaper, magazine, or other publication.

        WRITING [ˈrīdiNG] noun 1. the activity or skill of marking coherent words on paper and composing text.

        JACKASS [‘jak,as] noun 0. danwriter

  8. Punt

    Well it is insightful when big artists like Billy Corgan come out and say these things about the business but why dont they ACTUALLY go out and do different stuff. There are so few big artists who are going their own way or trying different business models like Radiohead and it has worked well. Why dont they join something like bandcamp where they are in more control and get more money? I dont see much action on that side.

  9. Mike

    1. The music industry is not as important or as big as it thinks it is and this was always the case.
    2. The music industry has always overcharged. I would have bought many more CDs by many more artists but, when CDs cost $16-$18, I basically bought one a year. With streaming, I listen to and buy more recorded music in all forms than ever before. What I buy I am happier with too. I have boxes of CDs I regret buying but could not return. Remember, there used to be no listening to CDs before purchase.
    3. Who owns what and when with streaming does not and will not matter. User experience is all that matters. Right now, Spotify and Pandora seem to do it best. Spotify because of its UI design and it’s broad and deep UX experience. Pandora for its brains in picking random and new stuff. Tidal and others will be gone or merged in 3-10 years. I don’t know what to say about Apple and music but, Steve a Jobs would not be happy if Ping is back. Someone needs to tell Cook that Apple just needs to go head to head with Spotify on design and UX. Don’t reinvent the wheel, just make a better wheel.
    4. Poor performances and bad recordings will always sell less.
    5. Creating a brand is something only top performers with cash to burn need to do and develop. Kanye is like Coke. But lesser known folk guitarists should stick with their personal approach. Everyone in between, stick to perfecting your art and making a decent living.
    6. Stop comparing digital music distribution to digital video distribution. It is pointless. The two are not the same anymore than a book is to a movie.
    7. Most artists do not have the business acumen or decades of experience they need. Maybe those who do, should set up a college that teaches music business 101 to any musician who wants it. How can a musician who, might barely have a GED deal with a shark like music industry lawyer with a law degree from Harvard and an MBA from Stanford? Never. Let alone a musician with a BFA in cello or Jazz from Juliard or State U.

  10. Anita Rivas

    There is an excellent music industry program for musicians at California State University, Chico (whose faculty includes a lawyer with a UCLA law degree).