[Dave Birch] This isn’t really about payments, but about the monetisation of intellectual property, which is a topic that will appear in the future of payments for sure. Anyway,
When the back catalogue of David Bowie was offered on Wall Street, the $55 million deal for future royalties on classics like The Man Who Sold The World was hailed as a new form of intellectual property securitisation and the idea of artists raising funds secured by future royalties of their work became known as Pullman Bonds, named after the banker David Pullman who drove the Bowie deal. Now, however, citing weak sales of recorded music and a downgrade to an unnamed company guarantor, Moody’s Investors Service downgraded the Bowie bonds. They have gone from an A3 rating to Baa3 – one notch above junk status.
Well, his bonds may be junk but his music isn’t: Aladdin Sane was the first album I ever purchased with my own money! Whenever I’ve seen David Bowie interviewed on TV, he’s always come across as smart. I can remember him talking about music becoming a utility, like water, and he’d obviously formulated a strategy for the future of music well ahead of record companies or, for that matter, investment bankers. Having seen the writing on the wall for the artificially high price of recorded music, Bowie decided against the “farmers path” (of demanding government support to keep prices high) and instead went down the “market path” (of selling an asset with a declining future to bankers). Good for him.
Mulling over the idea of financial instruments being backed by slightly less “real” items than gold or the full faith and credit of Blizzard, I’ve been reformulating my “money versions” ideas since my original post and the very useful discussion that followed. I’ve decided to make the definitions simpler…
- Money 1.0 was atoms.
- Money 2.0 was bits about atoms.
- Money 3.0 is bits about bits.
- Money 4.0 may well be bits about relationships.
It may seem strange to imagine trading in Bowie Dollars that are simply units of Bowie bonds, but why not? How is this different from Edward de Bono’s “IBM Dollar” (in that it’s a claim on some future asset) or similar instruments?
These opinions are my own (I think) and presented solely in my capacity as an interested member of the general public [posted with ecto]