Culture Industry is Hot!

Culture Industry is Hot! the Global Entertainment and Media Outlook report (2006), the worldwide market for cultural content is worth of 1.6 trillion getting bigger than conventioanl industries - US explains44%; Japan 8.5%; Korea 2.2% Peter Drucker, “The success and failure of each country will be decided by the cultural industries in the 21st century. The final battleground is the cultural industry."

What is Culture Industry? also called as leisure industry, information industry, creative industry or media industry the definition and what are included differs by country The GEMO report includes culture industry into fourteen segments: films, TV network, broadcast and cable, recorded music, video games, publishing (magazine, newspaper, books), amusement and theme parks, sports, characters, etc – fashions, architecture, design

Market Share of Culture Industry by Country (2003) Source : Global Entertainment and Media Outlook (2004)

GDP and culture industry growth: 2000~2003 Other countries Korea Cultural contents growth rate GDP growth rate 25 9.2% 4.6% 10 8 6 4 National Economy Cultural Contents 2 US Canada UK France China Source: Culture Industry White Paper(2004) Source: Global Entertainment and Media Outlook: 2004-2008

Korea’s market share in some manufacturing and cultural industries in 2003 Unit : hundred million dollar

Distinctive Features of Culture Industry risky business: cultural consumption are highly subjective and individualistic and changes very often, therefore hard to predict; a few hits heavily dependent on information technology: but IT killed publishing/music insutries very low reproduction (variable) cost with window effects that highly profitable like a gambling environmentally friendly (less pollution and less natural resource consumption)

Korean Cultural Wave since 2000 Before the Korean Wave, Japan had been on the forefront of the television and film industry in Asia, followed by Hong Kong and Taiwan American films dominate the world: even in France domestic movies’ market share was 45 percent in 2008 (EU average, about 25 percent) Young/talented/new blood came into Korean movie industry like Kim Ki-Duk, Park Chan-Wook have stolen the fame of a Japanese legendary director Akira Kurosawa

Movie Audiences in Korea Source: 2007 Korean Movie Year Book, Korean Film Council, 2007

Factors for pushing Korean Wave to Replace Japanese and Honkong’s strong government support; culture industry related budget from US$ 8.5 billion in 1999 to US$ 43.5 billion in 2003 the relatively lower price even cheaper than domestic products Korean TV dramas and films retain traditional values and virtues: family centeredness, respect for the elderly China and Japan relationship got worsened in the 1990s

Is Korean Wave just a passing fad? Are film and drama industries are declining globally? Is the Korean Wave starting to cool down and already fading away? in 2008, which was a very bad year, Korean cinema took slightly over 40 percent of the market the critical decline in its old markets but recently spread to new shores like the Middle East, South America, North Africa and Central Asia

<figure 1> Export and Import of TV Programs in Korea ($1,000) Export and Import of TV Programs in Korea

Korean Movie Export Source: 2007 Korean Movie Year Book, Korean Film Council, 2007

Korean Movie Export by Countries Source: 2007 Korean Movie Year Book, Korean Film Council, 2007

Threats for the Korean Wave some Asian countries have started to consider the Korean Wave as a cultural invasion, some even calling for a ban on the import of Korean pop culture China in 2005 cut airtime for Korean dramas by 50 percent because of an unbalanced trade of cultural products: the ratio of the industrial trade deficit to the cultural trade deficit is 1:10

Sharing Resources and Market in Asia Threats for the Korean Wave statistics have shown that in 2004 there were about 12,000 drama episodes made by Chinese producers, while there was only airtime available for 5,000 episodes. This resulted in a financial loss of 427 million US$ every year 'Manga Kenkanryu' which is used to describe the Anti-Korean Wave, and can be translated as 'the Hating Korea Wave'. It started as a web comic, and triggered a Japanese internet movement after being released in 2005

Who will lead the next Asian cultural wave? China with its 1.3 billion of population will be most likely if it further achive economic prosperity share our resources and avoid unnecessary competition among us; US is now dominating almost half of global culture market Asian cultural content, if we cooperate with each other, could be nearly as competitive as predominat US cultural products

Toward the Future 1 shrare our experiences/know-hows: Korean pop stars used to be trained in Japan till late 90s; Chinese future-to-be stars are now under trainning in Korea share human and financial resourses as well as market to comepete with US: Asia accounts for more than one third of global culture industries in terms of population size and expentiture Late-comers are often perfoming better; through copperation, all can move into frontier sectors of culture industries

Towards the future 2 not all culture industries are booming; declining sectors like publishing and music are declining and so-and-so like film (3%) and broadcasting (7%) according to the 2008 GEMO report However, some sectors are really hot: for instance online and mobile game industries are growing fast by more than 15 percent every year where Korea is a frontrunner

Towards the future 3 characters, animation, most up-to-date IT industries are still growing past more than 10% per year where Japan is an invincible leader cooperative production of various cultural products between Asian countries will be most economical way of competing with US dominance in the field and will bring all of us winners of the 21st century culture industry

Culture Industry is Hot!