4. Sector segmentation approach
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In order to effectively identify and prioritise challenges where the Technology Strategy Board could have the greatest impact, we have found it useful to identify those areas of commonality between the thirteen creative industry sub-sectors. Here we explain our approach and the results of that analysis.
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The definition of the sector, the “Creative Industries” was coined in the DCMS Creative Mapping Exercise [5] in 1998 and 2000. The sector was taken as comprising thirteen sub-sectors – Advertising, Architecture, Arts and Antique Markets, Crafts, Music, Design, Fashion Design, Film, Computer Games, Performing Arts, TV and Radio, Publishing and Software. The speed of technological change and market development in the interim has resulted in a blurring of boundaries between some sub-sectors and an increase in the degree of disparity between others.
In our analysis of the opportunities within the sector as whole, we have found it helpful to identify areas of commonality and cluster the sub-sectors accordingly. At a basic level, this has involved comparative analysis of two key factors: the relative importance of technology to the innovation occurring in the sub-sector and the nature of the final output. The result of this analysis has been to re-categorise by output into three main groups:
- Services – Advertising, Architecture, and Design (including Fashion Design);
- Content – Games, Film, TV, Radio, Publishing, Music, (and Performing Arts: dance, theatre, etc); and
- Artefacts – Fine Arts, Crafts.
In addition, we wish to enlarge the Content category by the inclusion of a new sub-sector: Social Media. We believe this represents the best way of recognising the enormous upsurge in user-generated and consumer interaction with content. At the same time, we feel it would be helpful to remove the broader category of software development from the Creative Industries sector. With software covered separately by the Technology Strategy Board’s ICT strategy [6] we do not address the specific needs of the software industry in this document, but do include computer games and leisure software. Additionally we have chosen to include Live Music in Music (instead of in the Performing Arts category). We believe this is a more useful reflection of the fact that the live and recorded sectors of music have grown much closer together in the last five years and seem likely to remain so in the digital era.
In comparing the three categories – Services, Content and Artefacts against their respective relationships to technology and relative economic performance (Figures 1 and 2), the economic value increases with degree of digital output and involvement of technology in the business process. Including advertising and excluding software, the content sectors accounted for 70% of Creative Industries GVA in 2006 [1]. It is also clear that, for a variety of reasons already mentioned, the more engaged with digital technology an industry is, the more likely it needs to transform its business model. Figure 11 summarises the results of this analysis.
(see Appendix 5 for definition of disciplines that fall under design)