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China’s Creative Industries
Dr. Lucy Montgomery
Vice Chancellor’s Research Fellow, QUT
Research Director, Knowledge Unlatched
Who am I? Why am I here?
• Vice Chancellor’s Research Fellow, QUT
• Research Director, Knowledge Unlatched
• Research: Interdisciplinary? Media and Cultural Studies.
China. Intellectual Property. Innovation. Creative
industries.
THIS PRESENTATION
• China’s Creative Industries (Context)
• China’s Creative Industries (The Book)
• State-Driven to Consumer Led Cultural
Production
• The role of intellectual property
• Film, Music and Fashion
• China as a source of insight into disrupted
markets and industries elsewhere?
Part 1: China’s Creative
Industries
Context
‘The creative industries are those that
are based on individual creativity, skill
and talent. They also have the potential
to create wealth and jobs through
developing and exploiting intellectual
property.' www.culture.gov.uk
• Advertising
• Architecture
• Arts and antique
markets
• Crafts
• Design
• Designer fashion
• Film
• Interactive leisure
software
• Music, television
and radio,
performing arts,
publishing and
software.
Where did the term come from?
• Developed in the UK in 1998 by a Creative
Industries Taskforce, set up by the incoming Blair
government
• Inclusion of the Arts and Culture in an economic
policy agenda
• Attempt to bridge divides between ‘high’ and ‘low’
culture, publicly funded and commercially driven
Where did the term come from?
• Further aim: to emphasise the existing strengths of
advanced economies: in 1998 CI already a major
component of GDP, exports and jobs in UK, US
and Western-Europe
• Creative Industries were growing at twice the rate
of other sectors of the UK economy
Criticisms of Creative Industries
• Debate about the role of ‘culture’
• Appropriation of cultural agendas for
commercial gain?
• Concern that social and community
emphasis of Media, Culture and the Arts
would be lost in the race to generate profit
• Emphasis of Intellectual Property
Are ‘Creative Industries’
Appropriate for China?
‘How do we begin to envision a parallel
discussion of something like creative
industries in a country where creative
imagination and content are subjugated
to active state surveillance?‘ Jing Wang, 2004
• UK: 7.3% of GVA of the UK economy:
Compatible in size to the financial services
industry
• China: less than 1% of economy
• CI in Hong Kong: 2.5% of GDP
• CI in Singapore: 2.8 – 3.2% of GDP
Benefits of Creative Industries
• High Growth
• Dynamic
• ‘Bottom up’ characteristics of creative industries growth:
small and medium sized enterprises, opportunities for
individual innovation
• ‘Clean’
• Ability to absorb educated/skilled workforce
• Ability to help propel developing countries from low-cost
production to high-value innovation?
Difficulties for ‘Creative Industries’
in China
• ‘Cookie Cutter’ Approach?
• Can investments in ‘Creative Clusters’ ‘Creative
Parks’ stimulate genuine innovation or creativity?
• Cultural entrepreneurship prevented by policy
environment and institutional legacies?
• Can creative industries form without strong IP?
‘In the present era culture has become a
more important source of national cohesion
and creativity and a factor of growing
significance in the competition for overall
national strength …we must stimulate the
cultural creativity of the whole nation and
enhance culture as part of the soft power of
our country . . .’ Hu Jintao, 2007
Why might ‘Creative Industries’ be
useful for China?
• Driver of overall economic growth
• High value, clean
• Need to develop a consumer-driven
economy
• Import substitution
• Soft-power
• Domestic control of culture
Part 2: Creative Industries in
China
The Book
• Began with a PhD –
evolved during a post-doc
at QUT
• John Hartley: MATE and
‘Uses of Digital Media’
• China: An opportunity
to interrogate copyright’s
‘negative spaces’
• An examination of
changing dynamics of
power between state and
consumers
• Part of a body of work
attempting to understand
the CIs
The Rise of IP…
...the growth of the creative economy has meant IP laws,
especially copyrights and patents, have moved centre
stage of the global economy. In the 1980s, IP was a
marginal factor in most economies and of little concern
to most policy-makers. Twenty years later it is a central
and important factor in almost all economic activity.’
(Howkins 2005, p.35)
The Creative Industries Challenge
• New technologies for copying, sharing and
distributing creative products
• Networked creativity
• Read/Write Affordance
• Challenge to ‘copyright industry’ business
models
• What role does intellectual property play in the
growth of the ‘creative industries’?
CREATIVE INDUSTRIES AND CHINA
• New technologies and new possibilities
• One of the fastest social and economic
transformations in history
• Market-based reforms
• Cultural transformations
• Changing power relationships
• WTO entry and formalisation of copyright law
THE RESEARCH
• Interviews conducted between 2004 and 2009
• Beijing, Shanghai and Hong Kong
• Directors, producers, record label executives,
distributors, mobile operators, musicians,
fashion editors and designers, collection
agencies, lawyers and judges
• The role of IP in cultural and creative industries
Film
(state)
Music
(?)
Fashion
(consumer)
FILM
• 1950: Chinese Film Bureau established –
responsible for pre-production censorship
• 1952: Film production nationalized
“…cinema was no longer a matter of business or
art, but rather a serious political operation
subject to strict censorship from start to finish.”
Zhang, 2004
FILM
• 1966-1976: Great Proletarian Cultural Revolution
• Film schools closed
• No films made between 1966 and 1972
• 1973 – 1976: Films reflected radical political agenda
FILM
• Until 1980s no relationship between income of a
film studio and popularity of a film
• By 1990s economic reform agenda forcing
studios to compete for audiences
• Competition from other forms of entertainment
• Early 2000s: private investment in films
encouraged
FILM: 2009
• Restricted access to commercially valuable mass
distribution (cinema)
• Pre and post production censorship
• Foreign film import quotas
But…
• ‘Pirated’ DVDs
• Internet, P2P, streaming, downloading
• Consumer creativity and distribution
CINEMA DISTRIBUTION
• A coordinated system of mass distribution
• Capable of converting popularity into scalable
profit for commercial distribution
• Commercial incentives for operating within statecontrolled spaces
MUSIC: Before the 1980s
• Conditions that gave rise to a recorded
music industry in other markets absent
• Live, recorded and broadcast music
were dominated by state-funded
Cultural Troupes
• A limited repertoire of propaganda
songs
MUSIC
“Illegal sales of music in China are valued by
[the] IFPI at around US$400 million, with around
90 percent of all recordings being illegal. No
creative or knowledge-based industry can hope
to survive in such an environment” John
Kennedy, IFPI: 2006
DIGITAL LEAPFROG
• Digital outperforming physical copies
• Digital sales: 3.6 billion RMB in 2005
• Best year of physical copies: 2.7 billion RMB
• Mobile the most significant source of music
related revenue
MOBILE MUSIC
• Closed distribution networks
• Publisher managed censorship
• Distribution licensing
• Commercially focused innovators
• Rapid growth in commercial activity
ENTREPRENEURIAL CONSUMERS
… to be an entrepreneur is to have
entrepreneurial governmentality that
makes it thinkable and practicable to relate
to different aspects of the world — people,
relations, institutions, the state, laws, etc. -- in
terms of symbolic commodities, risks, capital,
profits, costs, needs and demands (Yurchak,
2002)
Social Network Markets
A market within which choices are determined
by the choices of others.
FASHION
• Classic ‘social network market’
• Consumer innovation
• Risk (is this hat silly, or will I start a trend?)
• Reward: Status, fun, identity
IP in Fashion
• Trademark, rather than copyright
• Copyright: Emphasizes an author’s investment
in an individual creative work
• Trademark: Protection for investments in
reputation and image of a maker
• Trademark helps to maintain a connection
between a product and its source
Conclusions
• IP and the Creative Industries: One size unlikely
to fit all
• No longer a case of telling China what an IP
regime should look like
• Innovative approaches to IP and business
models are just as necessary in other markets
Co-Evolution
• Co-evolution of law, technology and business models.
• Firms most likely to succeed in global markets are firms
whose business models have evolved with weak IP.
• Challenges of enforcing copyright protection in distant
markets.
Early Days of the Record Industry
•
•
•
•
Expensive, specialised equipment.
Copying hardware not widely available.
Neighbouring rights.
Technological innovation + creative
innovation + developments in law = new
commercial opportunities.
Emerging Commercial Music Models
• Technology for mass reproduction
and consumption available before
copyright law.
• High demand + no legitimate
distribution channels = a thriving
market in unauthorised products.
• Internet, PCs and cheap MP3
players.
Making Money in the Chinese Music
Business
• Cross platform promotion – ‘Supergirl’.
• Merchandising, concerts, personal appearances, product
endorsements.
• Mobile as the largest (and fastest growing) source of
music related revenue.
• Is China’s music industry adopting strategies familiar to
the fashion industry?
Conclusions
• IP and the Creative Industries: One size unlikely
to fit all.
• No longer a case of telling China what an IP
regime should look like.
• Innovative approaches to IP and business
models are just as necessary in other markets.
• Evolutionary approaches to understanding IP’s
role in creative innovation (stay tuned).
What Next?
• Are any of the patterns I observed in China
generalisable to other markets?
• Design as a global industry…
• Publishing and scholarly communication…
• Less emphasis on copyright?
• The need for coordinating mechanisms capable
of enabling global markets
Thank You!