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Show me the money!

I was glad to hear the news on the radio this morning that Statistics New Zealand has measured the economic contribution of the Motion Picture business in New Zealand and it is as big as horticulture and logging. That makes it a major export earner. The Stats NZ figures say gross revenue from the film industry is NZ$2.6 billion.

Aside from the predictable clamouring for handouts, ahem ... incentives, from those eager to get their nose into the public trough, the news is encouraging because it is one of the first official measurements of the scale and contribution of the creative industries to the New Zealand economy.

I have been trying to get a clear picture of the value of the Creative Economy since we first locked onto the sector in the development of Idealog. It is a frustrating task because it is fragmented and much of the output is the product of individuals and small businesses. The data is collected by the IRD, but is not necessarily analysed and sorted into categories that have any significance. After all, what constitutes the creative economy? Is the inputs or the outcomes? It is easy to have an open, invitational approach to the concept any innovative activity in any sector as an example of the commercial creativity.

A farmer who invents a new way to clean the teats of his cows before milking may indeed be engaged in creative activity—in the broadest sense—but I don’t accept he is a card-carrying member of the creative economy (or as American economist Richard Florida calls us, the Creative Classes).

I’ve gone back to John Howkins’ book The Creative Economy, subtitled ’How people make money from ideas’, which I first read in 2001. He defines 15 ‘core’ creative sectors:

  • Advertising
  • Architecture
  • Art
  • Crafts
  • Design
  • Fashion
  • Film
  • Music
  • Performing arts (theatre/opera/dance/ballet)
  • Publishing
  • Research & Development
  • Software
  • Toys & games (excluding video games)
  • TV & radio
  • Video games

So, while the list may smack of creative orthodoxy there are inclusions with sufficient latitude to offer back-door entry by other categories. Both R&D and design are sufficiently nefarious as to accommodate a multitude of sins. Effectively R&D means activities that create intellectual property in the form of patents.

Howkins estimated that the global creative economy in January 2000 was worth about US$2.2 trillion and was growing at a rate of five percent annually. By 2020 he estimates with compounded growth the creative economy will be worth US$6.1 trillion and he makes the salient point that how products and services are managed and distributed will be as, if not more, important as the products themselves.

This is an issue for participants in the creative economy whom I regard as vendors, rather than patrons. The possibility for stellar growth is going to depend far more on the management of your talent and assets. One of the problems for sole practitioners is going to be how do you get noticed, get a deal and profit of an international scale. In Los Angeles every second server in a restaurant or coffee shop is an aspiring actor. Getting an agent is often the first step in getting noticed. Getting a heavy-hitting agent is the key to getting the roles that will lead to other roles.

I’d like to see the rise of the talent agent in New Zealand. They will intimately understand the working of both buyers and sellers (but, unlike real estate agents, there will be no confusion about who they represent—the talent).

So many creatives find it hard to break through the encumbrances of producing the goods and filling the pipeline with projects. The talent agent would let them get on with the real business of creating. There is also the issue of creating lasting value and income streams. Too many (New Zealand) creatives sell their products too cheaply and give up copyrights and residual income too easily. However skilled in the craft or discipline they might be, they often fall short in negotiation ability. The issue is amplified if you want to perform on the world stage.

Of course one of the problems New Zealanders have is a reluctance to share the rewards of their work with others. I’ve written before about our obsession with ‘going it alone’, the myth of the little Kiwi battler who takes on the best in the world with nothing more than a bale of hay, an old pair of shoelaces and a frypan.

Collaboration and easing the illusion of control is essential. I am reminded of the Rockefeller quote: “I would rather have one percent of the efforts of a hundred men that 100 percent of the efforts of one.” I think he had a premonition of Metcalfe’s Law of Networks (the value of a network increases by the square of the number of members).

I’m interested in your thoughts. Can you see the potential for talent agents securing deals for the engines of the creative economy (does that sound a little bit Atlas Shrugged?). Remember US$6.1 trillion dollars will be on the table in 2020. I want my agent to be shouting “Show me the money!” down the phone to a buyer in Paris, with another in Tokyo on hold. Meanwhile I go about the business of inventing the Next Big Thing.

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