The first use of any new technology...

Consensus 2024 with Mark Long

“The first use of any new technology is to make things even shittier for artists.”

I blurted that out a couple of weeks ago during a fireside chat with Mark Long, CEO of Shrapnel, at Consensus 2024 in Austin.

We had got on to the topic of AI and how it was affecting the economics of working in the creative arts. The backdrop was the then-recent scandal around OpenAI’s use of Scarlett Johansson’s voice (or, at any rate, a voice indistinguishable from hers) without her say-so.

In the wake of that controversy, OpenAI released records supporting its claim that they had hired a different actress with a similar voice. In a way, however, this reveals more about how techies think about creatives than if they had simply performed an out-and-out steal.

Actually ripping Scarlett Johansson off would have been a tacit admission that they needed her for some kind of special quality that only she possessed: “this artist can do something unique and irreplaceable; we couldn’t make a deal with her, so we did a shady thing.”

Replacing her with a soundalike says something different: “All that this woman really does, at the end of the day, is make certain sound patterns. Those can be simulated. Why would anyone pay for that?”

In a word, it’s an assertion that this artist’s work is fungible.

“Fungible” is a fusty old word that has gained new currency because of its use in “Non-Fungible Token” or NFT—a related topic that I won’t explore in this post. A fungible token, on the other hand, is a unit of currency. And the whole point of those is that they are interchangeable.

To pull an old quote from the Oxford English Dictionary: “Grain and coin are fungibles, because one guinea, or one bushel…of wheat, precisely supplies the place of another.”

Of course, the thing about grain is that it’s the very definition of a commodity. And commodity markets are always a race to the bottom.

When the commodity is something like wheat, there’s nothing wrong with that . If you’re a baker, and you have to buy wheat in order to run your business, paying anything more than the commodity price is just irresponsible. And if you’re a wheat farmer, you just have to accept that you’re in a commodity business and that the price is fixed by markets over which you have no control. Wheat farmers don’t have agents in New York or Hollywood, working to negotiate the best possible deal for their client.

The question, then, is whether artists’ work is about to become a commodity. It didn’t cross most people’s minds until the advent of DALL-E, Midjourney, and other such tools that threaten to make art fungible.

When the creators being displaced by that tech are small-time concept artists and designers, it doesn’t make headlines. They didn’t have much market power anyway. A tech company that wants to source some art could treat this as a commodity market. It’s not pretty and it’s not nice, but at the end of the day those companies are answerable to shareholders.

Things get interesting, though, when the artist in question has an agent. I’m using “having an agent” as a somewhat arbitrary, but still pretty reliable indicator telling us when an artist has achieved sufficient uniqueness that their work is no longer fungible, and, as such, can be priced above commodity levels.

For the entire time that I’ve been active in the writing game, and for many decades previously, having an agent was the goal for which every aspiring writer strove and toiled. Every publisher and every agency had a “slush pile,” which was the heap of unsolicited manuscripts that had come in “over the transom” and as such represented commodity-level writing.

Aspiring writers kept sending those manuscripts in anyway, in the hopes that they would one day be recognized by an agent or editor. Someone, in other words, with the power to confer on them the quality of non-fungibility that gave them the power to negotiate deals at better than the commodity price.

A similar state of affairs, mutatis mutandis, exists in other areas where artists have agents, managers, and lawyers. Hollywood being the most obvious example. Likewise, artists are represented by galleries. Architects and designers seek to join firms that employ various mechanisms to support the higher fees that they command.

The sum total of all of these roles and business arrangements, across all areas of creative output, adds up to a lot of money and supports a lot of people. That’s why the OpenAI/Scarlett Johansson affair casts such a long shadow.

Every movie producer in history, locked in a contract negotiation with a tenacious agent representing a big movie star, has probably wished that the star could simply be replaced with a nobody working for peanuts. But the producers end up paying the big money anyway because it actually is worth it. Hard-bitten, tough businessmen that they are, they respect the artists’ power to deliver something that, in the end, makes them money.

The question now is whether technology executives will see it the same way. Do creative artists still have something special that makes their product worth more than the output of an algorithm? As someone who has made a living typing out words one byte at a time, it’s pretty clear where I stand on the issue.

Hence my comment to Mark Long, quoted at the top of this post. I’m hoping that technology executives might sit back and think about ways to build businesses around artists’ superpowers, as opposed to looking for ways to turn them all into wheat farmers.