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Digital Britain

There was a diversity of creative business leaders at last week’s C&binet Forum.  As well as global industry leaders from Google, Spotify, EMI, Vivendi and many other major media leaders, publishers, content providers and distributors, there was a rich smattering of creative entrepreneurs (mostly not wealthy either because they work in community creative enterprises, or simply because they are emergent).  So both the formal sessions and informal chats were driven by an energy and passion around change and improvement to maximise the impact of UK creativity.

The ‘arts’ did not emerge much during the formal discussions, perhaps due to the domination of the copyright agenda. Twice they were mentioned, once by the CEO of  DACS and once by Colin Tweedy of Arts and Business who was given short shift by the panel talking about investment, who were interested in profit not patronage.  In their mind, music , publishing and games fell clearly under the remit of the creative economy, but subsidised arts did not.

This division is one which some of our artists and subsidised arts organisations feel comfortable.  It provides  some necessary protection and a space for the state to encourage the vital support of individual artists and arts activity which cannot and should not be commercial.  The metrics of the arts are not only (if at all) commercial but are educational, social and cultural, promoting well being, cultural identity, individual growth and community cohesion – as well as , most importantly, provoking ideas, thoughts and revelations.

But not to engage in the fast moving change  around the way we communicate and interact in the digital age  could be a catastrophic mistake which threatens some subsidised arts organisations with irrelevance and possible extinction.

And its not about using Twitter as a marketing tool.

The key areas are around interacting with audiences and around 21st century business models.

In terms of interaction, the massive increase in people interacting through games must surely given some ideas to arts organisations – especially those involved in drama and music – some scope to review current products and seek new collaborative methods of creating work.

And as for 21st century business models   – its all about Freemium and upselling.

The leaders of some arts organisations engage in the challenge and break through the aspic of subsidy.  Watershed, for example, in its Ished project is about to embark on creating theatre with participants through mobile technology. Cornerhouse through the Art of With is at least asking the questions about collaboration with users in curation and programming.  But the examples are few and far between.  In the mainstream of subsidised arts, the production and presentation of work is entirely led by the visions and drives of the artists at the top, and the machinery around that is concerned with realising the artistic ambition and attracting an audience for it.

So does it matter? Maybe subsidised theatres and arts centres are simply the organised versions of individual artists who create work for arts sake and damn the audience?

A colleague , faced with the evidence which demonstrated the type of work which would attract larger and more diverse audiences, and noting the artistic director’s disdain, described the ‘salon  theatre’ with which that organisation was engaged.

Personally, I think that is a great pity.  I, like many, discovered the arts with a little help from the library, my dad’s work night out to the (variety) theatre, and school trips.  A typical child of the ‘C2DE ‘ household with no books, art or music, the arts unfolded as I began my journey of discovery.

Subsidised arts organisations should encourage the discovery of today’s youngsters and engage with their equivalent of libraries and works socials – social networking and gaming as well as intense engagement in education.  Or else adopt the the model of supply-led theatre and arts, the ‘salon’ and make the case for investment for other reasons – the arts are, after all, good for your health, well-being, community cohesion and sense of self.

If that is the case, individual arts organisations will need to have their evidence ready.  We have less and less public expenditure available.  And government, particularly if the Conservatives win the next election, get it about business models.  Barnet Council’s freemium model could, if extended, mean that the arts and culture are an additional extra for tax payers.  And will they pay for salon theatre?

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Last week’s C&binet Forum was, on the surface, dominated by concerns about copyright from those with most to lose from filesharing. The agenda was framed to encourage the most fulsome arguments to be voiced by representatives of big players in music and publishing. And although all recognised the need for carrots to encourage consumers to pay for downloading content, and a campaign to raise awareness that filesharing is theft which could deny a livelihood to musicians and authors, most of the discussions were about the need for sticks. Today only 1 in 20 of downloaded music tracks is paid for.

C&binet is a not-for-profit network, created by the UK Government’s Department for Culture, Media and Sport to link the international creative and commercial communities to grow the global creative economy. At last week’s forum,  business leaders from across the creative and finance industries came together to debate access to finance for creative industries, new business models for online content, developing talent and securing creative rights.

Three cabinet ministers trailed the announcement made by Peter Mandelson on the final morning of the conference, that the Government proposed a new Copyright Strategy for rights management and licensing in the digital age, including the British version of ‘3 strikes and you’re out’, which is two notifications and then ‘proportionate’ action for those who violate copyright.

So with that all important stake in the ground,  other issues which were debated and discussed ..

Its all about the bandwidth, baby

In 5 years time the capacity of the internet will be enormous and with band widths and speeds on a completely different scale from today. So won’t the issue of downloading be redundant?

Mobile is more and more the future

Won’t our devices be ever more disposable as everything is kept in the cloud and as technology becomes embedded in our walls and cars? Notions of disposable Kindles were floated, looking down the evolutionary telescope.

Be Greater with Data

With the exponential extension of cyberspace, the amassing of meta data will form a content –aware network which will be pretty much able to know everything. This will generate multiple issues of licensing and privacy but will be able to be used for almost everything. People/consumers/customers/users will become more and more aware of the monetary value of their personal data as the transaction between users, suppliers and advertisers becomes ever more sophisticated.


Freemium is the business model for tomorrow- make that today

Although there were many references to the need to find new business models, that really was from those who only have old business models.

Taking publishing, Gail Rebuck of Random House told us that within 24 hours of the publication of the latest Dan Brown novel, there were 70 pirate sites offering it for free.

Cory Doctorow, on the other hand, is developing the whole suite of Freemium services with his forthcoming collection of short stories, with free downloadable editions in a variety of formats, pay-per-use audio CD, opportunities for readers to enhance their product, from the $250 hand bound edition to the $10,000 bespoke edition with a unique chapter for the purchaser. These are in addition to buying from a bookseller and his ‘donate’ service where you can buy a book and donate it to a deserving school or library.

This business model nestles comfortably amongst Spotify and Playfish- both of whom use the upselling model as their framework.

Collaboration is king
All of the statistics show that the areas where there is major growth is where people can interact and get involved – games and social networking.

Some of the industry leaders from the games industry, from Spotify and Google were bemused by the focus on copyright and old business models. With a global perspective, they have an eye on what is happening in China, India and Brazil where the growth in creative industries and internet activity is faster than in the UK. The next billion mobiles are projected to be bought in China. And Australia has invested $43bn in fibre networks.

In the words of a games industry leader  “if we don’t get a move on, the UK will simply be trampled on in the gold rush”

But now, with Mandelson’s announcement, we can get beyond copyright. Other areas were aired and discussed at the Forum and with a wide range of leaders of all types and scales of creative businesses attending, this could be the beginning of an effective network in which to influence Government for the success of our creative economy.

loch ness

Loch Ness from Taylor Dundee's Flickr photostream

The publication of the large suite of documents and data included in the Ofcom  Communications Market report 2009 contains a great deal of rich information – perhaps too diverse and dense to be as useful as it might be.  The report covers a wide array on information of such different species, from delivery of PSB quotas to public attitudes to the recession, that some commentators are questioning whether Ofcom’s remit is too large to be of benefit now.  The main report, at 334 pages on the web, is supplemented by shorter reports, including the Nations and Regions Communication Report, of which the Scotland version is 117 pages.  Small wonder then that commentary in Scotland has tended to be around the Scottish version and the summary statistics produced. And that some important points have been obscured in Scotch mist and myths.

But there are  important points.  In terms of market behaviour,  there are more similarities than differences between Scotland and the UK in terms of behaviour, attitudes and takeup of new technology.  The percentage differentials are small and the trends are the same. The report includes charts on the differences between Glasgow, Dundee, Aberdeen and Edinburgh which are more usefully compared with the UK major cities.  This shows  citizens in Edinburgh to be the most digitally enabled in the UK, more than London, and those in Glasgow to be the least in the UK.  But the problem with this data is the size of the sample.  With less than 100 people interviewed in Scotland, Ofcom cautions against drawing too many conclusions but of course people do because the pictures speak louder than the words.  So we again focus on the digital divide in Scotland, clearly shown to be from poverty and poverty of aspiration rather than the availability of cable.

The report describes the progress towards the tipping point where consumers chose digital over analogue, on line experiences over off line broadcasting and entertainment.  Nearly half of people will cut back on nights out – which includes visits to theatres and concerts and nearly one third will cut back on music, books and DVDs, one fifth on newspapers and magazines rather than cut back on internet and communications.  In the ‘what would you miss most?” question, NOONE would ‘miss most’  the activity of  listening to music on the hifi (as opposed to 18% in 2005).

The report also describes the delivery of quotas for nations and regions from Public Service Broadcasters. Although quotas for content production in the nations and regions have been met (main report), the charts and data show decline in spend in Scotland (as there is in the UK), and less in and for Scotland than Wales and Northern Ireland.  The BBC has changed the way it measures things.  Quotas include content made in Scotland and content for Scotland and so the report does not facilitate intelligent response.  No wonder Mike Russell has expressed dismay and asked for clarification. But the figures in themselves are only one symptom of the truth. Scotland should have its own digital channel, as recommended by the Scottish Broadcasting Commission and we need to produce content to, for and from Scotland to complement the international and UK content available to us.

Lies, damned lies and statistics. And some Scotch mist. Ofcom, NESTA and other UK agencies helpfully include Scottish reports as annexes to their UK reports.  Maybe its time we produced some simple, intelligent reports from the perspective of Scotland.

crocs
Although widely viewed as a damp squib, the Digital Britain report should be seen as enabling , with recommendations which will improve the digital infrastructure and enable greater digital access and success. But it won’t do it all, couldn’t and shouldn’t. And, at a time of accelerating change, the recommendations are not future proofed and there will need to be ongoing intervention by the state to support a digital Britain. But what about Scotland?

On the one hand the Digital Britain report did not support the recommendations of the Scottish Broadcasting Commission for a Scottish digital channel and Culture Minister Mike Russell MSP expressed disappointment.

On the other, the report announced the launch of three pilot schemes next year – one in the STV region, one in Wales and one in an English region – where consortia of media organisations will bid for licence-fee money to produce local ITV news. This represents the loosening of the BBC state monopoly and no one can predict where this will end. Things are moving.

This should also be seen in the light of the report of the  Calman Commission this week which recommends Scotland have more tax raising powers – albeit at the cost of losing its block grant.

So we are on a journey towards Scotland making key decisions with regard to the success of our creative industries in a digital world and backing them.

I have banged on  about the need to  support Scotland’s video games industry and the Digital Britain report alludes to cultural tax incentives to support the sector and we can hope that it actually happens. What will Scotland do for our team?