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Creativity and Commerce

Valerie | 12 Oct 2009, 17:10

C&binet ambassador comment: Patrick McKenna, Chief Executive of Ingenious Media, a leading investor in the creative industries.

Creativity and commerce often make uneasy bedfellows.  Here, in an interview first published in HOUSE magazine, Patrick McKenna talks about how we need to get entrepreneurial business talent and creative talent working better together.

“Creative talent is highly mobile and UK creative talent is particularly attractive to global companies. Whilst this isn’t a bad thing in itself, we must build greater business capacity within our own creative industries so that the UK can benefit from the commercial opportunities generated by our writers, producers, musicians and other artists”.

The relationship between art and commerce has always been fraught.  Business and creative people are often motivated by quite different impulses. There doesn’t have to be conflict of course.  Having worked with some of the biggest names in the creative world – from rock stars to theatre directors – I know from long personal experience just how rewarding, enjoyable and productive good partnerships can be when you get the essentials of the relationship right.

The UK has always had a strong entrepreneurial culture to complement the strength of its artistic culture.  This combination of attributes reflecting two different forms of creativity has often proved beneficial in helping to fuse the needs of art and commerce. 

In small businesses the benefits of matching such different skill-sets are usually obvious.  However it’s often not so obvious when it comes to bigger businesses.  Here there is frequently a gulf of understanding and trust to bridge - between finance and investment on one side, and creativity on the other. 

As a young partner in one of the major accounting firms I could see the growing importance of talent to business and therefore took a very conscious decision to learn everything possible about the entertainment world - how the relevant bits of the legal system worked, how the commercial side of things worked, and most importantly how the creative process itself worked. I read up on all the technical stuff and but also spent time with some very talented individuals from film, theatre, music and television learning about their aspirations and concerns.  After that it was much easier for me to talk business with artists, managers and entertainment entrepreneurs so as to understand what was important to them and so help them to attain their commercial objectives.

Partnership is the key, particularly in an ever more competitive and complex media environment.  First there is the initial partnership between the creative artist and the entrepreneur.  Later on, when the entrepreneur wants to grow the business, another kind of partnership is called for – a partnership between the entrepreneur and a more experienced businessman or woman, someone for example who has a mastery of the financial markets.

The most successful partnerships are the ones that link a truly creative person – whether artistically or entrepreneurially creative - with a strong business person. It’s a waste of time, frankly, to expect a creative genius to become a skilled business type as well.  And conversely, a businessman or woman can never really become a truly creative person in the fullest sense, meaning someone with exceptional flair and originality. Of course we can all learn more about each other’s strengths and skill-sets, and it’s important to make this effort to get mutual recognition and respect.  But there are clear limitations on both sides. 
Entrepreneurs are visionaries who generally thrive in relationships with experienced business talent.  They tend to have very similar characteristics to creative and artistic people.  But it is a mistake to assume that all entrepreneurs are necessarily good at business. 

At the Really Useful Group my relationship with Andrew Lloyd Webber was essentially a marriage of creative and business skills – a kind of model partnership.  As long as there is clear empathy, real understanding and mutual respect for each other’s talents and abilities, then there’s no limit to what can be achieved.  This arrangement allows the individual with extraordinary creative talent to be able to concentrate completely on being creative, knowing that the money and business side of things is being taken care of.

This is not to say that creative people shouldn’t be interested in commerce – far from it.  What it means is that creative individuals in such partnerships are freer to focus on what they are best at and most interested in.

Everything we do at Ingenious is fundamentally based on this idea of partnership – it’s all about acting as a bridge between media and creativity on one side, and business and finance on the other.  We try to be sympathetic to the insights and needs of both parties.  Much of it is to do with that word experience. You need to have an exceptionally deep knowledge and understanding of progressive media and the creative economy to understand its particular “box-office” risk characteristics, to be able to execute this bridge-building function successfully.

Partnership is a two way street of course.  Sometimes creative people are not necessarily keen on full collaboration, influenced perhaps by their earlier choices of business or investment partner.  But for things to work to mutual advantage, partners on the creative side do need to be engaged with the commercial process, which means understanding the requirements of financiers as well as managing the expectations of the other partners.

People with creative talent are often shielded from the expectations of business by their relationships with managers or entrepreneurial partners, and this is no bad thing.  In such cases it is absolutely necessary for the entrepreneur to be able to balance the needs and expectations of all the interested parties.  This in turn means that they have to be more sophisticated in their interactions with the world of finance.

Building strong partnerships between business and creativity ultimately provides artists and their managers with more options. It helps them build better and bigger platforms on which to show off their talent, allows them to retain greater control over their “IP” and thereby hold onto a bigger slice of the commercial pie.
One common ingredient to success in the games, publishing, television, music and film industries, is of course great people. This may sound obvious but believe me spotting talent, whether creative or entrepreneurial talent, is by no means easy.  You can become a business hero in the entertainment world almost overnight if you can successfully identify and align yourself with an extraordinary new talent. But it’s easy to get it wrong.

All countries have their own distinctive cultures.  We are awash with creative talent in the UK, but we don’t have a culture of taking the creative industries seriously as businesses, unlike the USA.  This goes back to the education system.  There’s a lot of emphasis these days in our great art colleges on getting creative people to learn about the basics of business and entrepreneurship.  What I don’t see much of is evidence of students in business schools and on finance courses at universities being taught about the distinctive characteristics of the media and cultural industries and of the creative process.

It’s not surprising therefore that top quality business talent is rarely attracted to the creative economy sector.  There are business graduates out there who are well educated, have a choice about what kind of business to go into but generally don’t choose the creative industries because they see them as being uncertain, more about luck than judgment, or generally “flaky”, with the rewards going predominantly to “the creatives”. 

In the UK we need more investors, financiers and business folk to understand the creative process.  There is still a big gulf, generally speaking, between the worlds of creativity on the one hand, and finance and business on the other.  This is damaging to the overall prospects of the creative economy.  From an investor point of view, it is clear to me that if business people were more engaged in the creative process, understood it better and could see it working up close and personal early on, they would stand a better chance of recognising good business and investment opportunities.
 
Creative talent is highly mobile and UK creative talent is particularly attractive to global companies. Whilst this isn’t a bad thing in itself, we must build greater business capacity within our own creative industries so that the UK can benefit from the commercial opportunities generated by our writers, producers, musicians and other artists.  We should aim to retain more of the economic ownership of UK creativity, rather than seeing so much of the commercial upside disappearing to the USA and elsewhere.

To do that we need to build creative industry business capacity in the UK. The way to do that is by starting with small and medium-sized businesses, helping them with business and management expertise, helping them to grow sustainably and persuading them not to sell out to the first trade buyer who comes along. 

We also need to educate the financial and wider business communities to have a better understanding of the business opportunities being generated by the exciting new world of digital media.  There’s been a lot of talk about value destruction and collapsing business models, but there are also some fantastic opportunities out there if you know how to recognize them.

If we can make progress on these fronts we have the possibility of establishing a virtuous circle, where great creativity is matched by great business talent, which is matched by sustainable investment, which in turn helps generate profits and attracts better people and yet more investment, and so on.  This is a prize worth aiming for!

Ben Bradshaw’s speech to the Royal Television Society

Andrew | 17 Sep 2009, 14:52

C&binet comment: Ben Bradshaw, Secretary of State for Culture, Media and Sport

I delivered the keynote speech to open the Royal Television Society’s biennial conference in Cambridge last night.

I argued yesterday the future of the BBC is closely tied up with the future of our broadcasting sector, and our broadcasting sector is central to the success of our creative industries as a whole. As a Government we are pushing ahead on a range of fronts — such as peer-to-peer file sharing, rolling out next generation broadband, and a consultation on allowing product placement — to ensure that the media industry can come out stronger than ever from the current global downturn.

I also spoke about how the BBC has used the digital revolution to grow over the past decade, and what that means for the private sector side of the mixed broadcasting economy in Britain that has swept up awards and revenue from around the world. James Murdoch has recently argued for state sponsorship of broadcasting to be cut right back. My view is that the BBC has probably expanded enough — but I offer that as the start, not an end, of what I hope will be a national conversation about the future of a national institution.

Whatever its exact size, the BBC is going to remain central to the future success not just of our broadcasting industries but our creative sector as a whole. Fresh from one gathering of creative minds, I am looking forward to the next, and to seeing progress on creative rights, new business models, securing finance and finding talent when we meet at the c&binet forum next month.

What can c&binet achieve?

Andrew | 24 Aug 2009, 15:01

C&binet comment: Siôn Simon, Minister for Creative Industries

What is the point of c&binet?

That is the one of the first questions I put to DCMS civil servants when I was appointed Minister for the Creative Industries in June.

There was a commitment in Creative Britain to develop a World Creative Business Conference as ‘a platform for leaders in the creative and financial sectors to develop a deeper engagement and dialogue’.

Which is great.  But what does it mean?

There is no point in bringing together the best creative people from around the world - in person and online - with just the hope that serendipitous discoveries emerge from the craic.

The c&binet Ambassadors are big players in the sector. The cast list for the forum in October is already looking impressive.

But we still need to be going into the conference prepared to extract from them real value in terms of their thinking on growth and investment in the creative sector globally, and greater reward for creative talent and entrepreneurship.

In the run up to the forum I want to use this space to help define what it is that you in the creative industries want to see happen as a result of the c&binet forum.

The copyright debate rages on. What actually is the best course of action for industry? For governments? For emerging web entrepreneurs?

What is needed to get cash flowing into creative businesses, to attract and sustain investment?

When advertising doesn’t work, what business models do?

What exactly do businesses need to do more of to harness skills and nurture talent - and what should we agree to do less?

What should governments do? If anything?

The point of c&binet is to make progress, to shape change. So let’s get on with it.

The British Library: Building the digital future

Valerie | 03 Aug 2009, 09:00

C&binet comment: Dame Lynne Brindley, Chief Executive of the British Library

Dame Lynne Brindley has led the way in the British Library’s engagement with the digital environment. Here, she outlines its response to the recent Digital Britain report and explains the key areas that are vital to ensuring the continuing relevance of the British Library in the UK’s transition to a digital society.

Every year nearly half a million people use the Reading Rooms of the British Library at St Pancras. As they cross the Library’s piazza our Readers walk over, literally, the intellectual and cultural memory of this nation – held securely in 200 miles of shelves beneath the ground and accessible for all today and into the future.

They also pass Paolozzi’s wonderful statue of Sir Isaac Newton, who famously wrote: “If I have seen further it is by standing on the shoulders of giants”.

Certainly creativity – along with research and innovation – does not simply emerge from nowhere: it thrives on learning and being inspired by ‘giants’; it is often achieved in a dense dialogue with the past; and it frequently depends on what Will Hutton has called a ‘propitious public infrastructure’, an investment made over the centuries which provides the UK with a rich basis for its successful creative and cultural industries, and for its scientific endeavours.

The physical British Library is full to overflowing today with individuals creating new knowledge, being inspired, setting up new businesses, discovering more about themselves. Journalists, film and television producers, scholars, musicians, students, budding entrepreneurs, authors – fill our spaces with purposeful activity, generating societal and economic value.

However, in a rich, complex, multi-media world of the Internet, with unbounded opportunities for new kinds of creativity, how do we continue to ensure our relevance as we make the transition to a firmly Digital Britain? How do we ensure we remain globally competitive, innovative, prosperous and engaged?

I believe that the British Library’s contribution to Digital Britain will focus on three key areas. Firstly, we need to develop our role as public custodian and guarantor of sustainable access to quality content. At the British Library we can help deliver a truly digital future for Britain by growing faster our role as custodian of Digital Britain’s collective memory - a critical public service that acts as a springboard for research and education, for new forms of creativity, and for knowledge creation.

Without investment in such services, future researchers and citizens will find a black hole in the knowledge base of the 21st century. Without a guaranteed long-term commitment to analogue and digital preservation, there will be no giants’ shoulders to stand on, and our content and creative industries will be inhibited in their global market success.

Secondly, we need to digitise legacy content on a mass scale as a key infrastructural benefit for education, creativity and competitiveness. Innovative business models are the key to success and I want to see more experimentation with new models for funding content creation and digitisation.

A superb recent example was the public launch of our 19th Century British Newspapers website (http://newspapers.bl.uk/blcs), developed in partnership with JISC (Joint Information Systems Committee) and Gale. The service has made two million historic newspaper pages available online to researchers and the hybrid business model demonstrates the benefits of adopting a public-private approach for large-scale digitisation.

Finally, we need to support the development of widespread digital literacy skills to ensure inclusiveness and optimal exploitation of new opportunities. We may get the infrastructure and the content envisaged by Lord Carter’s Digital Britain report, but if we do not have proficiency to exploit the opportunities, such investment will have been wasted. Our research is suggesting that while young people demonstrate an ease and familiarity with computers, they rely heavily on search engines, view rather than read, are promiscuous in their information seeking and do not possess the critical skills to assess the information they find on the Web.

The British Library and JISC have recently commissioned a second study, into the research behaviour of the current generation of post-graduate doctoral students – classed by their age as ‘Generation Y’ – to gain insights into their changing research behaviours during the course of three years of doctoral study.

Such insights should inform our approach to digital literacy over the next decade as we seek to consolidate and build upon our position as a key creative and increasingly digital economy – particularly in the light of our many competitors’ efforts to do the same.

See: http://www.bl.uk/digital

Rethinking the notion of piracy

Valerie | 18 May 2009, 09:15

C&binet comment: Peter Jenner, legendary manager & artist advocate for bands like Pink Floyd.

Peter Jenner has managed musicians since 1966 with a repertoire of artists including Pink Floyd, Billy Bragg and Eddi Reader.  He has spoken publicly about the issue of music piracy before and now offers his solution to c&binet.

Lets get rid of the idea of Piracy and Theft when looking at the internet and p2p exchanges of music, despite Pirate Bay.

Piracy and theft both involve the notion of property, which is finite (in economic terms: scarce), and which if stolen by someone from you no longer belongs to you, but then belongs to someone else.

In the digital world scarcity is not an issue. Each copy of a file merely increases the supply of that file, and the original still exists. If you copy my file I still have it. If someone then directly or indirectly sells that copy I am no poorer. I might be annoyed that they did not ask my permission, but they have not caused me damage.

So I suggest we use the less emotive, less glamorous word ‘unauthorised’ to describe the copying of a file without permission. This lowers the emotional level of the discussion and we can look at the issue of ‘authorisation’ or ‘remuneration’. We can look at the underlying issue of how to ensure that resources are properly transferred to the creator from the user of that file. ( Another word change, ‘user’ rather than ‘consumer’ is also desirable. Something consumed is gone, something used can be used again).

The challenge of the digital age is not to maintain an existing industrial / commercial structure but rather working out how to create a new environment, which delivers a result that society wants. I presume this includes a social structure where people can create content, where there is some form of payment for the use of that content , and which is consistent with the costs involved in both the fixed initiation costs of creation, and the marginal costs of reproduction and exchange.

We might also decide that we want to continue with a system of promotion and marketing of those creative goods, which will also have to be paid for, but that is a secondary concern. The present debate seems to be mostly about protecting the financing of the industry built around the physical manufacture, distribution, marketing and promotion of the creative goods, rather than the welfare of the creators. When the spokespeople for an industry start talking about their concern for the creators one should be suspicious. When they are also trying to hobble a new distribution system we need to be doubly suspicious.

Let us talk to the creators, and lets talk to the new distributors, and the users of the music and work out a system which gets the best results for those essential people, then let us worry about the financiers, the marketers, the promotion people, and even the managers. The only people who really matter are the creators and the users, all the rest of us in between have to justify their position in the new environment.

Andy Burnham, Kate Nash and Feargal Sharkey in conversation

Andrew | 22 Mar 2009, 10:11

Guest blog: Feargal Sharkey, CEO of UK Music, who represent the UK’s commercial music industry

Creators must be heard to make a difference

I recently chaired a conversation between Secretary of State Andy Burnham and the musician Kate Nash, who was representing the Featured Artists Coalition (FAC). You can download a podcast or transcript of the conversation from this page.

Writing as a former artist, I know as well as anyone that creators’ voices have often been conspicuous by their absence in music industry debates.

Clearly this is not right. The past decade has seen huge upheaval in how the music industry operates; but without creative talent, there simply is no industry.

It was for this reason that one of UK Music’s first initiatives was to announce the world’s first Creators’ Conference – with the idea of bringing together a diverse range of around 100 UK artists, songwriters, composers and musicians, and allowing them a private, free and direct dialogue with both Andy and the European Commissioner for the Internal Market, Charlie McCreevy.

Two months later, the event took place on 11 December 2008 in Central London.

Music-makers expressed their opinions on anything from file-sharing and copyright to Top Of The Pops; while Andy and Charlie had an opportunity to explain how creativity is now a key driver of the UK and European economies, and how politicians’ actions can make a real difference to those who make a living through music.

As a first step, I think the Creators’ Conference was an incredible success.

Indeed, fast-forward three months, and, in addition to songwriter/composer and musician representative bodies (BASCA, and the Musicians’ Union) in the shape of the Featured Artists Coalition there is now an organisation established specifically to provide a voice for contracted artists

As a member of FAC’s steering group, Kate, along with the likes of Billy Bragg, Dave Rowntree and Ed O’Brien has been a key figure in the new organisation’s creation, and this podcast builds on a conversation first initiated with Andy back in December.

I think it is vital, welcome and overdue dialogue. And one that UK Music will do all it can to facilitate and develop in the months and years ahead.