Industry Report: Digital
From creation to consumption - the film industry has drastically changed over the past 10 years
by Paraskevi Karageorgu
- An in-depth look at worldwide developments in the film sector over the past decade, according to the new UNESCO report on Global flow of cultural goods in the digital age
The new report from the UNESCO Institute for Statistics (UIS),The Globalisation of Cultural Trade: A Shift in Cultural Consumption--International flows of cultural goods and services 2004-2013, takes an in-depth look at the export and import of cultural goods and services around the world and evaluates the way the digital age has influenced the cultural industry. From the report it becomes clear that the film sector has been one of the most affected by the digital shift. While cultural exports have doubled over the past ten years, reaching a total of US$ 212.8 billion in 2013, cultural export of cinematic goods has fallen by 88% over the 2004-2013 period. The reason is that movies are increasingly being sold as web-based services and not as physical goods. The report also provides an important definition of audiovisual goods, where a movie downloaded from the Internet is considered as service and this poses many difficulties in measuring the contribution of trade in audiovisual goods to the global economy.
As a direct result of globalisation, the film industry is internationalising its entire value chain, from a movie's creation to its consumption. Film production continues to involve increasing numbers of stakeholders from different countries and is shot in a variety of different locations, which makes it difficult to capture information on film production worldwide. The report uses Luc Besson's 2014 film Lucy [+see also:
film profile] as an example: the film director and producer are from France, the cast is from France, Asia, and the United States, it was filmed in locations across France, Germany, and Asia, and with post-production taking place in Canada.
One of the key findings of the report, which illustrates the phenomena of film consumption internationalisation, is that at least half of the top 10 movies seen in 2012 and 2013 were the same movies in 71% of the countries surveyed. In addition, Warner Bros. Pictures claims that 62% of its box office sales were generated internationally in 2013. The countries with the strongest performance of local films are China, India, Japan, Morocco, South Korea, Turkey and the United States, where at least half of the most popular movies viewed were national productions. This, according to the report, could be explained, with the stronger production capacities of these countries and the cultural policy measures they have adopted, such as quotas for national movies shown in theatres.
In addition, many of the flows in cultural services occur between headquarters and affiliates. European Audiovisual Observatory data indicates that foreign affiliates identified as established and operating in the European Union have increased by 22%, from 833 in 2008 to 1,019 in 2013. However, no global data on FATS revenues are available for the film industry.
The shift of cultural consumption poses an enormous challenge to cultural development itself. The reason being that all over the world, activities, such as music downloads or film streaming, require strong internet access. The UNESCO report pays particular attention to the data provided by the International Telecommunication Union, which indicates that only one-third of households in developing countries have access to the Internet, compared to 78% of households in developed countries. This key report data shows the implications digital shift consumption has not only on the film industry, but on the development of the cultural sector all over the world.
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