It sounds a bit odd to refer to things like TV and radio programmes, or pop music, as creative 'industries'. Yet – as I said last night when I spoke to a Royal Television Society event on this subject in the House of Commons - activities like these are increasingly being seen through the lens of how they contribute to economic growth. That contribution is already surprisingly large: it's almost 3 per cent of economic output, and more than 10 per cent of total exports (with 2.6 per cent contributed by TV and radio), according to the DCMS.
Just at present, a lot of people have less to spend on non-essential items, or are just being cautious. Many businesses in the creative sector are a canary in the cage for the wider economy – although they do very well when the economy booms, their revenues can decline just as fast in an economic downturn. This one may prove especially tough because at the same time digital technologies are changing consumer habits and spending patterns. A lot of established companies in sectors from recorded music to local newspapers are struggling as the move to digital cuts existing sources of revenue before it is obvious what the new ones are going to be.
Yet technological change also means the creative sector could make a bigger contribution to long-term growth. Britain has a lot of creative talent. The Olympics and Paralympics showcased, as well as the UK's sporting talent, our talents for singing, dancing, acting, designing, and our delight in music, laughter and drama. Digital will mean new opportunities to make a wider and more personal choice available to consumers, and to take what we have to offer to world markets.
What will help make sure that the creative industries can successfully get beyond the short-term ups and downs? As in any other part of the economy, long-term success will depend on innovation and investment.
This includes innovation in the content created by these industries – 'content' meaning programmes or music or stories, for example. People's appetite for new content drives their adoption of innovative technologies, and this demand in turn encourages investment in infrastructure such as broadband.
Other government policies can help the creative sector. One example is making sure copyright is adequately protected. The government also needs to ensure the online market remains a level playing field for all competitors, by protecting 'net neutrality'.
The BBC can make an important contribution to the creative sector as a whole. Spending last year outside the BBC on independent productions, performing groups and creative talent came to £1.1bn. A large proportion of this (about two fifths) was spent outside London. The BBC's research and development division makes technical innovations widely available. The BBC Academy and partnerships with Skillset, PACT and universities make a major contribution to training for non-BBC staff. BBC Worldwide, the commercial arm, distributes and broadcasts programmes by the BBC and other UK producers around the world – last year paying £76.2m to indies in upfront rights investment, profit share and royalties.
The Trust has been particularly encouraged by the way the BBC has responded to our urging more engagement with the industry and more partnerships, both on- and off-air. Recent examples range from The Space – an online arts service combining BBC technology, training and mentoring with Arts Council England support for a wide range of arts organisations – to YouView, a partnership with other broadcasters and technology companies providing internet-connected television. We will be doing a better job for licence fee payers if the BBC can take opportunities like these to support the creative sector, for the benefit of the whole economy.
