© GERET 2015

The Business of Creationand the creation of business

Alan FreemanGeopolitical Economy Research Group

www.geopoliticaleconomy.ca

• UK Department of Culture, Media, Sport (DCMS)• National Endowment for Science, Technology and

the Arts (NESTA)• Queensland University of Technology (QUT)• Greater London Authority (GLA)

……and a cast of billions

Sources

• Victorians: steam, trains and ships•Early C20: electricity, steel and skyscrapers

•Postwar: oil, cars, and household gadgets•C21: the internet, design and aesthetics

Mass consumer markets in designed products

Each age has characteristic technologiesand markets

Financial and insurance

Construction

Creative Economy

Manufacturing

Science economy

0 500 1000 1500 2000 2500 3000 3500

2013 jobs

Financial and insurance

Construction

Manufacturing

Creative Economy

Science economy

- 1,000 2,000 3,000 4,000 5,000

2030 jobs

The changing structure of British Industry

Science already bigger than manufacturing; creative nearly as big

By 2030 both will be bigger

Total ‘intellectual labour-based’ will be bigger than all others by 2030

Source: DCMS January 2015 estimates, figure 5 and table 6

The engine of creation

What drives this growth?

Creative workers in the creative industries

Non-creative workers in the creative industries

Creative workers outside the

creative industries

Creative Intensity = 2/(1+2) =52%Source: DCMS January 2015 Creative Industry Estimates, Figure 1 (page 3)

What are the creative industries?

• ICT is a revolution in service productivity.• It creates a mass market in cultural products

• One song can be heard by hundreds of millions of people

• Consumers use this freedom to exercise choice. • Choice is part of every product

• Manufacture is also transformed• Short, customised, incorporating design and cultural content

• Content sells products• This is why Samsung succeeded.

New mass markets

• Cars• Skylines• Restaurants• Furnishings• Real Estate• Plumbing (believe it)

… even Canada Tired

You see it here, you see it there, you see it everywhere

• This not the age of the robots • human labour is decisive• But a special kind; the kind that robots can’t replace

• Not ‘post-industrial’ • Creative labour needs the technology• The machinery supports service delivery

• High technology plus high-end labour• Software• Education• Content• Social consumption (aesthetics)

A new marriage of human and technology

Revenue from recorded music

Revenue from Live music

Music as share of consumer spendingSource: Page, W.; Carey, Chris; Haskel, Jonathan, and Goodridge, Peter. 2011. ‘Wallet Share’. Economic Insight 22, 18 April .

Expect the unexpectedCulture gets Live and Local

Creative Industry Density0.178 to 0.5830.12 to 0.1780.078 to 0.120.046 to 0.0780.003 to 0.046

The neighbourhood as factoryThree key concepts

• Open Innovation (Chesborough)

• Motley Crew (Caves)• Pre-market selection

(Caves)

Caves, R. 2002. Creative Industries: Contracts between Art and Commerce. Cambridge, Mass.: Harvard University Press.Chesbrough, H.W. 2008. ‘Open Innovation: A New Paradigm for Understanding Industrial Innovation’. In H. Chesbrough, W. Vanhaverbeke and J. West, eds. Open Innovation: Researching a New Paradigm, Oxford: Oxford University Press.

The Infrastructure of creation

How do creatives use technology?

Why do creatives

congregate?

What do cities do?

The creation of business• GET THE EVIDENCE

• Foster the creative places• Provide the creative technology

• Enable the creative people• Join the dots, build the networks

• Bring the jobs here• Showcase our strengths

• Learn how to fail• BRAND: Don’t pretend; don’t underestimate;

Don’t forget: Art knows how to fly•Feed it, and you won’t regret it•Starve it, and it won’t come back •Our infrastructure is human creativity

•You can’t manufacture creativity•You can’t manufacture people•You can give them wings•Birds remember their home