I think when most people consume art, they're really treating it as
entertainment regardless of its artistic merit.
And as I mentioned above, I think the current music industry is already there: the vast majority (by sales) of music entertainment, produced by algorithm and by a committee in order to drive sales. Despite this, in the genres I care about, at least, the volume of high-artistic-merit music (by variety) that is probably at its highest point in decades, if not ever. To be sure, this has meant that fewer artists are able to make a living purely off their music. But this is a return to the norm: the rise of the "star" in the late 20th century has been an aberration.
On the other side of the coin, AI assistance will be (I expect) a huge democratizing force. Recently we've seen computational photography enabling people to take photos of astounding quality with just their phones. And the results of machine learning is allowing artists to make huge improvements in post production as well.
I imagine that the stuff we've been seeing over the past year, with ChatGPT, Stable Diffusion, and such technologies, will be purposed towards (among other things) tools that enable greater productivity for the serious artist, and putting the means in the hands of those who would be otherwise unable to get to table stakes. I've started working on a short story myself, using ChatGPT to help me work through some plot points.
So yeah, we'll get a lot of meritless dreck suitable only for base entertainment. But we'll also see a proliferation of art and of artists, as productivity increases and new entrants are enabled.