How the Creative Media Sector is Structured

1. How the Creative Media Sector is Structured Unit 3: The Creative Media Sector

2. We will examine: • Sector: • television; radio; press; publishing; film; interactive media; computer games; photography and photo imaging; advertising and marketing • Size, shape and structure: • geographical scope, eg multinational, national, local; status, eg small-size and medium-size businesses, independent, subsidiary; structure, eg private, public, cross-media

3. Assessment Criteria: • P1 - outline the structure of the creative media sector • M1 - describe the structure of the creative media sector with some detail and with reference to appropriate illustrative examples • D1 - explain the structure of the creative media sector with reference to precise and detailed illustrative examples

4. What makes up the Creative Media Sector?

5. Activity: • In pairs pick one sector of the creative media industry and see if you can find out: • How big is the sector? • How is it structured? • What is it made up of? • How many companies operate in this sector? • Who are they? • Who owns them? • When did they start? • What do they do? • How much money do they make? • Creative Skill Set

6. The Creative Media Sector: • Approx 550,000 people work in the media industry. • Interactive media (computer games, online multimedia, web, internet, interactive TV, mobile content) is the largest sector, employing 48,600 people. • Around 188,000 are employed in the audio visual industries. If film production and performance were also to be included in this number, the figure would be closer to just over half a million. (Skillset Employment Census 2009)

7. The Creative Media Sector: • The big industries within this sector are terrestrial TV and independent TV production, together employing approximately 56,000, radio employing 23,000 and interactive media employing 40,000. • The biggest increases since 2006 have been in interactive media, animation and television production. • Of all the people working in the sector in 2009, just under a quarter were working on a freelance basis but this varies hugely dependent on sector and role.

8. Television: • The UK industry is dominated by a mix of the major broadcasters and a larger number of less well-known broadcasters and production companies. • There are nine so-called terrestrial broadcasters, whose output is broadcast through land-based transmitters. • They include the BBC, ITV, Channel 4, Five, S4C, SMG and UTV. • These companies are also called Public Service Broadcasters, with a range of obligations set out in their licences, and in the case of the BBC in its Charter.

9. Television: • There are 300 cable and satellite broadcasters. • This sub-sector is dominated by major international players, including BSkyB, Virgin Media, Discovery, Disney and Viacom, • Catering to local interests are the growing number of community TV companies • By far the largest part of the industry is comprised of around 850 independent production companies (often referred to as the ‘indies'). • They make many of the best-known programmes on television - programmes like the X Factor, Big Brother and Life on Mars. • The biggest companies (the so-called super-indies) have turnovers of between £100-200m per year and employ thousands of people in the course of a year.

10. Television: • Television is going through a period of rapid and profound change • Among the drivers of change and challenge are: • Faster than predicted growth of broadband in the home in the UK and the massive success of mobile media; • Globalisation of the TV and video market; • Traditional TV business models challenged by audience fragmentation and move of advertising to the Internet; • ‘Content is king': audiences seek programmes and content rather than channels and schedules; • Shape of TV sector in flux: with mergers and acquisitions bringing new big players into UK market; growth of super-indies and volatility of SME sector.

11. Radio: • The range of platforms for distribution of audio content is increasing, and media and telecommunications are converging across the board, defining what we mean by the "radio industry" now, or what it may become in future, is a challenge. • Radio operators fall into three broad categories: • publicly-funded radio, • commercial radio • community and voluntary radio sector - from well-established student and hospital radio to the most recently licensed community radio stations. • The industry has been growing steadily in recent years and now employs over 22,000 people (more than terrestrial TV) in a wide range of occupations. • Employers range in size from the BBC and larger commercial radio groups to not-for-profit community radio stations run mainly by volunteers.

12. Film: • The UK's film industry is part of a constantly evolving creative media landscape. • There are 6 different component parts: • Development, Production, Facilities, Distribution, Exhibition and Export. • The nature of the industry means production companies are often set up for a specific production and then close down when production is complete. • Latest research shows there are around 400 'permanent' (i.e. registered) companies in the film industry, this figure varies depending on the number of productions being worked on at any one time. • Of the companies existing today, approximately 43% are production, 13% are distribution and the remaining 44% are exhibitioncompanies

13. Film: • In 2006, the UK film industry contributed £4.3 billion to the UK economy, up from £3.1 billion in 2004. • The UK industry is an independent creator of feature films, a co-production partner and a provider of services to the international film industry. • In 2007, UK production activity was £747 million, making it the fourth highest production year on record. • Inward investment productions including Harry Potter and the Half Blood Prince and Chronicles of Narnia: Prince Caspian and indigenous productions such as Brideshead Revisited and How To Lose Friends and Alienate People were just some of the productions made in the UK. • 516 films were released across the UK in 2007, a 58% increase over the decade. UK films, including co-productions, accounted for 21% of releases and 29% of the market by value. • In 2007 the UK had the largest number of digital screens in Europe at 296 screens, double the number in 2006. • While it is usually the cinematic release of a film that establishes its reputation, over half the revenues of the industry in the UK come from DVD/video retail and rental.

14. Animation: • The animation industry in the UK consists of a workforce that stretches across many of the sectors in the creative media industries. • Just over 2000 people work in animation in the UK, nearly half of them freelance, and there are currently more than 300 companies producing a range of work. • Animation is a relatively small sector that is growing in success and popularity. • More flexible scheduling by broadcasters has increased opportunities for animators and the internet provides another platform for short and experimental work. • Big-budget features such as Toy Story have enjoyed great commercial success and 2002 saw the introduction of the first ever Oscar for an animated feature, won by Dreamwork’sShrek. • The Animation Sector can be roughly divided into four main disciplines: • 2D drawn or traditional; • 2D computer generated • stop frame; and • 3D computer generated.

15. Animation: • In total, the global market for all forms of animation is currently estimated to be worth $50bn p.a. • There are a wide range of freelance, some contract, and some more permanent jobs in animation. • These can be found at small production companies, larger studios, computer generated post production facility houses and at computer games developers or interactive media designers. • The UK has an excellent reputation for creativity and technology, but high production costs mean that less than 5% of the animation currently seen on our TV screens originated here. • Unlike some other sectors in the creative media industries, animation has a number of distinct and highly successful centres of excellence outside London; including Bristol, Manchester and Dundee.

16. Gaming: • The Computer Games industry comprises around 4853 businesses which are shared among three sub-sectors: • games development, games publishing and games support companies • The Computer Games industry comprises a variety of company sizes, with a similar proportion of very small and large companies in the sector. • A quarter (25%) of companies in the Computer Games industry employ between 1 and 5 people, one in ten (11%) employ between 6 and 10 people, and two in ten employ each of 11 to 20 people (18%) and 21 to 50 people (21%).

17. Gaming: • The remaining quarter (25%) of the industry has more than 50 people working for them, which includes the 5% with a workforce of more than 200. Almost all of the larger companies are either developers or publishers. • The global market for video games is projected to grow at an annual rate of 10.6% over the coming years to reach $86.7 billion in 2014. • The sector generated £2 billion in global sales and contributed £1 billion to GDP. • Within this global market the video games development sector in the UK was the third largest in the world in 2008, after the USA and Japan although it has since fallen behind Canada and possibly South Korea.

18. Publishing: • The Publishing industry generates a turnover in the region of £10.1 billion GVA (Gross Value Added) and is one of the biggest earners and exporters for the UK Creative Media Industries. • Publishing is made up of many different sectors: • Books; • Journals (including electronic journals); • Newspapers; • News agencies; • Magazines and business media; • Directories and mailing lists; • Other information services. • The industry consists of a majority of small companies: 88% of them having less than 10 employees. Yet the 3% with 200 or more employees have over half of all those working in the industry on their payroll.  • The main geographical area of employment is London and the South East. The East of England is next, followed by the South West, Scotland and the North West. In Wales and Northern Ireland the sector is predominately made up of small publishers and news media

19. Press: • The press publish newspapers, magazines and comics. • The national daily newspaper market is dominated by a small number of titles. • They are owned by an even smaller number of media organisations. • The biggest of them is News International

20. Press:

21. Advertising & Marketing: • The Advertising industry generates £6.2 billion annually for the UK economy. • It crosses multiple platforms from broadcast, print, billboard and online. • There are around 13,000 business in the sector who produce £6.2 billion of the UK GVA annually.  • Around 70% of the industry is based in London, with the north west having the second largest concentration at 6%. • It is a young industry with 47% under 34. 46% of the workforce is female and only 6% is from black, asian or ethnic minorities (source: Creative and Cultural Skills, 2007).

22. Advertising & Marketing: • It's importance as a sector to the broadcast and print industries are crucial. Advertising funds 75% of commercial television, 95% of national press, 80% of magazines, and 95% of commercial radio. • Without advertising revenue the quality and quantity of programming and editorial would suffer (Source: IPA, 2008). • Most people in advertising fall into five departments: • Account Services - who liaise with clients and maintain their relationship. • Creatives - who generate the ideas and concepts for a campaign. This may be for one platform or across multiple platforms. • Production - this team moves the ideas from the creative concept into reality. Some of the larger advertisers may have these services in house, but the majority of agencies will need to have good contacts with production companies and facilities houses. • Media - the media planners work with the different elements of the media that advertising crosses. This department organises where the campaign will be seen to create the maximum effect.  • Other Services - these may include researchers, interns (who may work across several departments) and a traffic department which looks at the flow of the agencies work

23. Interactive Media: • The interactive media industry is a very fluid sector with many overlaps with, and blurred distinctions between, other sectors. • It is worth several billion pounds annually and employs around 34,300 people, representing approximately 7% of the total Creative Indistries. • Interactive media is not so much a sector as a discipline, as its creation and use is increasingly becoming part of everyday activity across all sectors of industry in general.

24. Interactive Media: • As interactive media products become more sophisticated, their development increasingly has greater overlap with the software and IT sector • The market for interactive media contributes to, and even underpins, a number of significantly larger markets. This is taking into account those who enable it, buy from it and, in turn, are enabled or supported by it. The biggest of these are e-commerce and online advertising. • The UK's interactive media industry is worth several billion pounds annually, but its products support a far larger economy.

25. Photo-imaging: • The total Photo Imaging workforce comprises around 43,100 people.  • 51% of these are based in the south of England, with the largest proportion - some 38% - in London and the South East. The rest of the workforce is spread throughout Scotland, Wales, Northern Ireland and the remaining regions of England, with the highest concentrations in the South West (13%) and the East of England (12%). • The Photo Imaging industry is made up of 8,700 companies, two thirds (68%) of which are sole trading or freelance photographers. • The remaining companies can be broadly divided into the following categories: • Image producers (including laboratories and minilabs) • Photo retail • Picture libraries and agencies • Manufacturers • Support services (e.g. equipment hire and repair) • Across the industry as a whole, 91% of companies employ five people or fewer.

26. Activity: • For each of the sectors outlined above find examples of companies which operate within each sector (have started you off with TV) • Is the Media sector controlled by a small number of companies? • Is the media industry controlled by companies outside of the UK? • Who are the MAJOR competitors in each sector?