CREATIVE INDUSTRIES SWITZERLAND FACTS.MODELS.CULTURE
CHRISTOPH WECKERLE MANFRED GERIG Birkhauser
Basel· Boston· Berli...
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CREATIVE INDUSTRIES SWITZERLAND FACTS.MODELS.CULTURE
CHRISTOPH WECKERLE MANFRED GERIG Birkhauser
Basel· Boston· Berlin
MICHAEL SONDERMANN
CONTENTS
Acknowledgements
4
1.fl
Introduction
5
2.fl
Creative Industries in the International Context
9
2.1 2.2 2.2.1 2.2.2 2.3 2.3.1 2.3.2
Development ofthe Term "Creative Industries" since 1970 Different Views ofCreative Industries in the Current Discussion Supranational and Non-European Discussions The European Discussion Attempting to Systematize Definitional Approaches Approaches to an Argumentation
9 10 10 17 21 21 23
3.fl
Creative Industries Switzerland
27
3.1 3.1.1 3.1.2 3.1.3
Fundamental Definitions The Diversity ofthe Branches: Creative Professions The Diversity ofCreative Professionals: Business Models Creative Professions, Business Models, Fields ofActivityan Integrated Perspective Empirical Overview New Statistical Classification of the Individual Sub-markets Strengths and Weaknesses ofthe Statistical Basis Structural Data ofthe Creative Industries in Switzerland The Development ofthe Creative Industries in Switzerland The Swiss Creative Industries in an Overview of the Branches Developmental Trends in the Selected Sub-markets A Detailed Analysis ofthe 13 Sub-markets Core Terms of the Sub-market Analysis The Music Industry The Book Market The Art Market The Film Industry The Broadcasting Industry The Performing Arts Market The Design Industry The Architecture Market The Advertising Industry The Software and Games Industry Handicrafts The Press Industry The Audio Industry
27 28 30
3.2 3.2.1 3.2.2 3.2.3 3.2.4 3.2.5 3.2.6 3.3 3.3.1 3.3.2 3.3.3 3.3.4 3.3.5 3.3.6 3.3.7 3.3.8 3.3.9 3.3.1fl 3.3.11 3.3.12 3.3.13 3.3.14
33 34 34 36 38 40 42 45 47 47 48 54 61 66 70 73 78 82 86 89 92 94 97
4.11
Switzerland - European Union
99
4.1 4.2
Switzerland Compared to Europe The European Creative Industries
99 103
5.11
Focus: Creative Scene
107
5.1 5.2 5.2.1 5.2.2 5.3 5.3.1 5.3.2 5.4 5.4.1 5.4.2 5.4.3
Requirements and Characteristics Design and Designers as a Paradigm ofthe Creative Scene Design Designers Capital in the Fields of Business and Activity The Concept ofCapital Fields ofBusiness and Activities The Logics ofAction and the Creation ofValue Stages Motive and Options: The Spiral Model Value Creation in Creative Scene
107 110 110 113 116 116 118 121 121 123 130
6.11
The Creative Industries: Political Fields, Sponsoring Mechanisms, and Sponsoring Objectives
133
6.1 6.2 6.3
Political Fields Funding Bodies Funding the Creative Scene?
133 137 139
7.11
Recommendations for Providing Financial Support to the Creative Scene
141
7.1 7.2 7.3 7.3.1 7.3.2 7.3.3 7.3.4 7.3.5 7.4
Decisions that Need to be Made by Funding Bodies Making the Spiral Model Operational A Funding Model for the Creative Scene Financing Infrastructure Education and Continued Training Market Access Intellectual Property In Place ofa Conclusion: An Example in Four Phases
141 141 145 146 148 149 150 150 153
8.11
Appendix
156
8.1 8.2
About the Interviews und Group Discussions Bibliography
156 158
ACKNOWLEDGEMENTS
The authors would like to thank Ianine Schiller for her
We would like to thank the designers who participated
valuable suggestions and meticulous review of the
in the group discussion and who allowed us to interview
manuscript, Gabriela Frei for compiling the online bibli-
them, Robin Haller for his coordination work, and the
ography, as well as RalfMichel, manager ofSwiss Design
teachers at Swiss art and design universities and acad-
Network, for his support. We would also like to express our appreciation to
emies for the focus discussion. Furthermore, we would like to thank the Zurich
the different branch and umbrella professional organi-
Universityofthe Arts for being the inspiring and greatly
zations for their constructive criticism regarding the
supportive home of the Creative Industries Research
project, especially the Swiss Film Producers' Associa-
Unit.
tion (Willi Egloff), the Art Galleries Association Switzerland (AGS, Hans Furer), the Swiss Design Association (sda, Gregor Naef), the Schweizerischer Buchhandler- und Verlegerverband (Swiss Association of Book Traders and Publishers, SBVV, Martin Iann, Giancarlo Menk), visarte (Visual Arts Association Switzerland, Sonja Kuhn, Roberta Weiss-Mariani), the Swiss Association of Engineers and Architects (SIA, Jean-Claude Chevillat), the Schweizerischer Buhnenverband (Swiss association of professional theaters, SBV, Marco Badilatti), the SUISA Foundation for Music, Roy Oppenheim), and the International Federation of the Phonographic Industry Switzerland (IFPI,Peter Vosseler).
1.B INTRODUCTION
It might at first seem unusual that a book about the cre-
tors can be derived from analyzing current debates on
ative industries does not include the words "dynamic,"
these industries.
innovative," or "society" on the cover. The terms "facts" listed in the subheading to imply
We can generally recognize two approaches that
an empirical quantitative aspect, "models" for a theory-
have almost nothing in common and often contradict each other. In one, creative industries studies concen-
based qualitative approach, and "culture" to imply an
trate on the industry's empirical aspect and present a
in-depth examination of the creative scene, a sub-seg-
highly dynamic world, illustrated with steeply rising curves. These studies implicitly focus on the question
ment ofthe creative industries, are relatively sober. The book deals with different approaches and differentiated perspectives that converge to form constellations that,
"What are the creative industries?" and tend to confirm the outsider view of political and other decision makers.
in turn, open up new perspectives. The time to publish this book was chosen for a
The other approach describes the creative industries
specific reason. The authors believe it is necessary to
relations are a central issue and State-funded programs
develop new approaches and methods, because it seems
such as the Kiinstlersozialkasse in Germany, an organi-
that the creative industries discussion is either going
zation that acts as an artists' union and includes a health
around in circles or has stalled completely. Although decision makers have discovered every level of the term - the creative industries are used as a model of success
care and pension plan. This type of study places the
throughout economic and innovation policies, educational policies, city planning, and so on - strategies to put this model into practice remain astonishingly vague. There is an increasingly urgent need for approaches that can be applied to concrete situations. It remains to be seen whether the specific measures in this publication can provide a driving force. The question of how discussions of constructing approaches to the creative industries' complex of sec-
from a sociological perspective, where precarious labor
question "Who are the creative industries?" at the fore, and presents an insider view. Ifit is possible - and this is one ofthe aims ofthis book - to bring these two perspectives closer, to relate them more, and to help them better complement one another, then there may be a chance of advancing the discussion on the creative industries. An approach of this kind impacts the structure of the publication: integrating qualitative and quantitative approaches remains a challenge and consequently both will always exist side by side.
"CreativeIndustries Switzerland" is accordingly divided
and comment on the creative scene's innovative poten-
into four, complementary sections. The first presents an
tial in relation to the creative industries as a whole.
overview of the international discourse on the creative
Active individuals in the creative scene are profiled in
industries and analyzes the different terminologies,
essays and photos. The fourth section summarizes the findings ofthe
arguments, and special aspects so as to benefit the Swiss context. The knowledge and information provided in this
first three and identifies various aspects of funding methods. Taking Switzerland as an example, concrete
first section form the basis for the empirically oriented
topics are defined and the appropriate funding bodies
second section, in which issues of an adequate and
recommended.
internationally applicable version of the Swiss creative industries are raised and answered. The second section
This publication represents a broad spectrum within a specific focus, and is directed accordingly at a
gives statistical indicators that are considered necessary
wide range ofreaders. It addresses individuals who wish
for different levels of discourse. The empirical-statisti-
to familiarize themselves with the creative industries on a strategic-political level, who want to deepen their knowledge, or who are active in developing means of
cal analyses ofthe individual submarkets in the creative industries in Switzerland, compared to Europe, update the I. Kulturwirtschaftsbericht Schweiz ' (First Swiss Cultural Industries Report) and expand on it with differ-
funding. The detailed section on the creative scene also opens interesting perspectives to small businesses
ent aspects as regards the diverse nuances in perspective. Micro-market structures and dynamic developments are examined from positive and negative points
active in this sector. "Creative Industries Switzerland" should be read as a progressive argumentation of international and
ofview,and the gaps, where empirical statistical analy-
national points ofview,and ofqualitative and quantitative approaches. The aim is to clarify and correlate different standpoints. Each individual section - international analysis, empiricism, qualitative approaches, rec-
ses break down, are also pointed out. The third section concentrates on a segment ofthe second, the creative scene, and within it on the design industry. A qualitative focus describes motivational aspects and uses model-based approaches to break
ommended methods of action - deliberately uses its own language and can be observed individually.
down empirical findings to a detailed qualitative level, 1
WECKERLE, CHRISTIAN, S6NDERMANN, MICHAEL,l. Kulturwirtschaftsbericht Schweiz (First Swiss Cultural Industries Report), Zurich Univer-
sity ofthe Arts, 2003.
Published bythe Zurich University ofthe Arts, "Creative Industries Switzerland" chooses artistic and creative production as its central theme. This close relationship to individuals active in the field serves as a reminder that the creative industries cannot be treated as a streamlined issue, but are highly complex and, to a certain extent, cumbersome. With this publication, the authors hope that the analysis of the creative industries portrayed in the approaches selected here will draw together and lead to a deeper understanding ofthe otherwise separate qualitative or quantitative approaches, the insider and external views, and the many phenomena that emerge at interfaces, and ultimately prove that the creative industries deserve further discourse.
2.B CREATIVE INDUSTRIES IN THE INTERNATIONAL CONTEXT
The creative industries are increasingly considered to be dynamic and attractive in areas as varied as culture, eco-
ucts and services compete with those of her dominant American neighbors.
nomics, and politics; yet the term remains ambiguous
In 1983, the Institut pour Ie Financement du
and difficult to grasp in content, structure, or empirically. This introductory section attempts to systematize
Cinema et des Industries Culturelles (Institute for fund-
the most important approaches and models and to developcriteria for a strategic discussion on the subject. In this section, we analyze the current discussion on the creative industries, and examine different concepts or notions of the creative industries in supranational organizations and individual nations [2.1,2.2].
ing cinema and cultural industries, IFCIC) was established in France as a form of State-backed financial guarantee to banks and lending institutions that fund projects in the creative industries. It helps companies in this sector to access funding, and also encourages banks to provide the necessary financial support. In
The knowledge gained will subsequently be systema-
1985, "Soficas" (film and audiovisual industry finance companies) was founded, to sponsor films selected by
tized and applied to further considerations in this pub-
the French ministry ofculture. In the mid-roxos, a study conducted on the eco-
lication.
nomic significance of Zurich's cultural institutions 2.1 DEVELOPMENT OF THE TERM "CREATIVE INDUS-
became very significant." Its methodology is interest-
The cultural and creative termi-
ing, and it also contributed to shaping the discussion on the issue ofindirect economic benefits that extend well beyond Switzerland's borders.
TRIES" SINCE 1975
nology that gave rise to current discussion began developing in Europe and Canada in the 1970s.2 Essays from France focused on the field oftension between "les pouvoirs publics" and "le secteur marchand" in a cultural and socio-political perspective. They also called for cultural policies to position themselves vis-a-vis new perspectives that no longer depended on place and time. 3
In 1992 in North Rhine-Westphalia, Germany, after the decline ofthe coal and steel industries, the cultural industries were analyzed as an economic alternative as regards its "image, tourism, and economic, and labor market factors." 5
The phrase "arts and culture industries" was coined by the mid-1970S in Canada, but it was more politically motivated by Canada's need to have her cultural prod-
In the United Kingdom, the debate started in the 1990S when the young Prime Minister Tony Blair made the legendary claim to the umbrella organization of
2
Earlier involvement at least with some aspects ofthe creative industries can be easily established. See, for example, TARDE,GABRIEL,Psychologie economique, r900; the author deals with aspects such as the intellectual components ofartistic products. The book market during the Weimar period is also worthy ofmention here.
3
GIRARD, AUGUSTIN, Industries Culturelles, in: Futuribles, r7, Paris r978, pp. 597-605'
4
BISCHOF, DANIEL P., Die wirtschaftliche Bedeutung der Zurcher Kulturinstitute. Eine Studie der Iulius-Bar-Stiftung (The economic significance of Zurich's cultural institutions. A study by the Julius Bar Foundation), '985. From the Swiss perspective, the cultural-economic models developed by Bruno Frey are also noteworthy in this context.
5
Archiv fur Kulturpolitik (eds.), Dynamik der Kulturwirtschaft Nordrhein-Westfalen im Vergleich, 1. Kulturwirtschaftsbericht '99'/92, (The dynamics of the cultural industries of North Rhine-Westphalia in comparison. rst cultural industries report 1991/92) ARcult, 1991.
British labor unions that "pop music exports were finan-
on the attempt to understand the basic principles ofthe
cially more significant to the country than the steel
global discussion.
industry." 5 Since the mid-I990S, the EU has effectivelytreated the field as one that provides jobs and integration.
UNESCO
-
CULTURAL
DIVERSITY
THROUGH NEW TECHNOLOGY
AND
ACCESS
The United Nations Educa-
tional, Scientific, and Cultural Organization (UNESCO) 2.2 DIFFERENT VIEWS OF CREATIVE INDUSTRIES IN
Convention on the Protection and Promotion of the
The creative industries
Diversity ofCultural Expressions B accords great signif-
have now come to mean almost anything ranging from
icance to the creative industries because oftheir employ-
the individual products and services of an artist, to all
ment potential and their facility to integrate new tech-
elements ofa national economy that are based on some
nologies.
THE CURRENT DISCUSSION
vague notion of creativity. Yetterms such as "technol-
UNESCO views the creative industries as a global
ogy," "tolerance," and "talent" 7 are turning the creative industries into a core political interest, where they are
phenomenon and sees here a promising opportunity for its chief socio-political concerns, such as north-south
discussed as an attractive area in which to design the
disparity, cultural diversity, and freedom ofexpression. Technological innovations offer fascinating pros-
future.
pects of bringing local skills to global markets, and of 2.2.1 SUPRANATIONAL AND NON-EUROPEAN DISCUSSIONS
Seen from a global perspective, the variety ofter-
establishing new partnerships and solidarities between first-world countries and developing nations.
minology and different concepts of the creative indus-
UNESCO draws a conceptual distinction between
tries are astonishing. Every three months on average,
the cultural and the creative industries. Cultural indus-
State representatives from China, India, and Australia
tries refer to branches that specialize in the creation,
organize national and international trade fairs and
production, and commercialization ofcreative - includ-
establish research academies. Recently, supranational
ing intellectual - products and services. The phrase
organizations have moved to the fore, as well as conti-
"creative industries" is described in more detail: these
nents including Africa and South America. These now comprise many sub-organizations of the UN (United
are sectors "in which the product or service contains a substantial element ofartistic or creative endeavor ..." 9
Nations Organization), OECD (Organization for Eco-
This specifically includes "printing/publishing and
nomic Cooperation and Development), and WTO (World
multimedia/audiovisual, phonographic and cinemato-
Trade Organization).
graphic productions/crafts and design/architecture/ advertising." 19
This diversity is presented here, yetis not explained in depth because an entire overview cannot be sufficiently conclusive, and individual explanatory sections would be little more than summaries. Rather, we focus
6
Musikjahrbuch Schweiz, 2004.
7
Chapter 2.2.1 Creative Class.
B
UNESCO,
Convention on the Protection and Promotion ofthe Diversity ofCultural Expression, 2005.
9
UNESCO,
Global Alliance for Cultural Diversity, Understanding Creative Industries, Cultural statistics for public-policy making, n.d.
19
,..,'"
ibid.
WIPO - PROTECTING INTELLECTUAL PROPERTY AND STIMULATING GROWTH The World Intellectual Property
department for the creative industries wants to establish qualitative and quantitative studies on the creative
Organization (WIPO) deals with issues pertaining to
potential of individual countries, develop tools for
intellectual property. Its position is that ownership
understanding this potential, and support creative indi-
recognition of inventions and creative works will
viduals by protecting their interests regarding intellec-
encourage their production, and that this will stimulate economic growth. "The continuum from problem to
tual property. Selected models can be found in the WIPO Con-
knowledge to imagination to innovation to intellectual
vention Of196713 and in the WIPO Guide on Surveying
property and finally to the solution in the form ofproducts, continues to be a powerful driving force for economic development." 11 The organization is aiming for a
the Economic Contribution on the Copyright-based Industries (20°3).14
system that "rewards creativity, stimulates innovation and contributes to economic development while safeguarding the public interest." 12 The relativelynew WIPO
CORE COPYRIGHT
INTERDEPENDENT INDUSTRIES
PARTIAL COPYRIGHT INDUSTRIES
NON-DEDICATED SUPPORT INDUSTRIES
Press and literature Mus ic, theat rical prod uctions, operas Motion picture and video
Furni ture
Rad io an d television
Household goods, chin a and glass
Photogra hy Software a nd databases Visual and graphic Arts Advertising services
Archi tecture. eng ineering,
Copyright collection societies
surveying
Blank recording material
Interior design
Paper
Museu ms
CHART 1_ OWN CHART DEFINING THE WI PO'S DIFFERENT MODELS TO THE CREATIVE INDUSTRIES.
Source: WIPO, Guide on Surveying the Economic Contribution ofthe Copyright-based Industries,
2003.
11
www.wipo.org
12
ibid.
13
Convention Establishing the World Intellectual Property Organization (signed in Stockholm on July 14, 1967 and amended on September 28, 1979).
14 WIPO, Guide on Surveying the Economic Contribution ofthe Copyright-based Industries,
2003.
UNCTAD - CREATIVITY ROOTED IN THE CULTURAL
In this context, cultural industries represent the com-
CONTEXT OF A COUNTRY The United Nations Confer-
mercialization oftraditional activities, whereas creative
ence on Trade and Development (UNCTAD) advocates
industries refer to cultural as well as creative compo-
integrating developing countries into the global econo-
nents in other products and services.
my. UNCTAD believes that knowledge and creativity are among the driving forces behind economic develop-
ILO - ACCESSING THE CREATIVE INDUSTRIES MAR-
ment. This particular, important aspect of the creative
KET The International Labor Organization (ILO) deals
industries does not apply to first-world countries; on the
with social justice, human rights, and employment
other hand, its potential benefits to emerging or devel-
laws. Similar to UNCTAD, the ILO has also established
oping countries are not yet optimally employed.
that cultural goods and services constitute a significant
This implies that a great strategic opportunity is
share of world trade, but that they are not sufficiently
being neglected, since the UNCTAD believe that creativ-
exploited in developing countries, because creative indi-
ity -largely as work, capital, or technology - is rooted in
viduals here either lack the necessary skills or have no
a country's cultural context. Artistic expression, talent,
access to the appropriate markets. For this reason, in
and openness, along with the propensity to experiment
2001
or develop new ideas, are not exclusivelythe privilege of
this problem.
the ILO began offering workshops that address
developed nations; they provide developing countries
With the "creative industries," the ILO describes
with the opportunity to expand their share in the global
those goods and services that should be viewed under
market and to develop a new level ofprosperity.
the aspect ofemployment or growth in employment. An
UNCTAD believes the creative industries empha-
important value is ascribed here to small and mid-sized
size the commercial potential ofan area previously con-
enterprises. The ILO define as specific activities the
sidered essentially non-commercial. Art in this sense is
fields ofmusic, the performing arts, dance, ethno-tour-
extended to include elements ofcommercialization and
ism, visual arts, handicrafts, film, and television. 16
technology.
N ....
UNCTAD terminology distinguishes between
THE WORLD BANK - CREATIVE INDUSTRIES AS A
publicly funded culture, the cultural industries - including handicrafts, considered significant by UNCTAD -
GROWTH MARKET FOR DEVELOPING COUNTRIES The
and the creative industries, which include the following
of the most promising sectors of economic growth for
sectors: recording industry/music and theater produc-
developing countries. 17 As an important global player in
World Bank also considers the creative industries as one
tion/motion picture industry/music publishing/book,
the field of development aid, the World Bank offers
journal and newspaper publishing/computer software
financial and technological support, and advises gov-
industry/photography/commercial art/radio, television
ernments in their various efforts. Proof of its success
and cable broadcasting industries. 15
can be seen in the positive results achieved in Africa by
15
UNCTAD, Creative Industries and Development, TD(XIJ/BP/I3, 2004.
16
Promoting the Culture Sector through Job Creation and Small Enterprise Development in SADC Countries, SEED Working Papers, Nos. 49-53.
17
ibid.
investments in mobile communication. In order to
The OECD realizes that not every region or city can ben-
establish a qualified, creative industries workforce, it is
efit to the same degree from these effects and that the
essential to first ensure a modern and efficient infra-
creative industries require specific production condi-
structure, high quality social and cultural facilities, and
tions. The appropriate skills can be developed through
the amenities ofan intellectually open society. These in
education, developing sales networks, or through regu-
turn are key factors in the successful development of
lating copyrights.
urban centers, and thus in the economic prosperity of an entire region.
The OECD distinguishes between the "core ofcultural activities" (that is, live performance, plastic art,
Creative industries are a relatively new field for the
architectural heritage, cinema), "cultural industries"
World Bank, which defines the sector as "software, pub-
(audiovisual productions, records and disks, books), and
lishing, design, music, video, moviemaking, and elec-
"creative industries" (design objects, fashion, musical
tronic games." lB The common element here is the
instruments, architecture, video games, advertising, etc.)." Yet the OECD believes that the "creative industries" exist on the periphery ofcultural activities, because they produce products and services primarily for branches outside of the cultural sector. The OECD, like WIPO,is increasing its involvementin the creative industries. A basic report was compiled 21 and then expanded on at the end of 2006 in a workshop in Paris. The ILO's International Standard Classifications of Occupations (ISCO) were discussed; the process is ongoing.
important intellectual components in the products and services and the consequent need for protection against misuse. There are other international organizations besides these UN sub-organizations that are intensely active in the field of creative industries. The OECD and the WTO are examples worth mentioning in this context. OECD - THE CREATIVE INDUSTRIES AS NEWLY DISCOVERED EMPLOYMENT POTENTIAL For some time, the
WTO - WORLDWIDE PROTECTION OF INTELLECTUAL
Organization for Economic Cooperation and Develop-
PROPERTY RIGHTS
ment (OECD) left culture to the public sector. It also
(WTO) is the body globally responsible for international
considered the cultural sector comparatively unproduc-
trade rules and regulations. The Agreement on Trade-
tive in relation to other branches of industry. Now,
related Intellectual Property Rights (TRIPS) forms a
The World Trade Organization
OECD nations are advised to give more consideration to
cornerstone ofthe WTO system. It defines the interface
the employment potential of creative branches. 19 Prod-
with the creative industries. The WTO believes that this
ucts and services offered by the creative industries rep-
agreement has significantly improved the worldwide
resent interesting development opportunities for cities
protection of intellectual property, and it affects the
and even entire regions, as well as the positive effects of
products and services offered by the creative industries
tourism and export.
on various levels.
lB
YUSUF, SHAHID, NABESHIMA, KAORU,
Urban DevelopmentNeeds Creativity. How CreativeIndustries Can AffectUrban Areas,
WorldBank, 2003, p. 2. 19
For Switzerland,see: OECD Reviews on Innovation Policy, Switzerland, 2006.
2.
OECD,
Culture and LocalDevelopment, 2005.
21
OECD,
International Measurement of the Economicand SocialImportance of Culture, 2006.
The World Trade Organization does not offer an explicit
CREATIVE CLASS - EVERYONE IS CREATIVE This model
description for the term "creative industries." However,
was developed in the United States and has been widely
their involvement with different aspects of intellectual
discussed in Europe; it presents creativity as one of the
property (copyrights and related trademark rights, fac-
most valuable products ofa national economy and one of
tory, trade, and service brands, indication of source,
its most important driving forces. It establishes a direct
designs, patents, topographies ofmicrochips, and busi-
correlation between economic growth and creativity.
ness and manufacturing secrets) shows interfaces with
This model introduces the notion ofclass, in con-
many approaches at definitions that will be introduced
trast to most occupational- or branch-defined models.
here. A diagram ofthis reference is given below.
There are various indicators that display the positive
Seen from a global perspective, it is also impor-
effects of the "creative class." The mobile and globally
tant to observe individual nations along with suprana-
active individuals typical of this new social class can
tional organizations. For Switzerland, this would pri-
only flourish in cities with professional structures and
marily involvethe USA and Asia.
tolerant attitudes.
PATENT Application: Simple e.g. molecule Complex e.g. microprocessor
COPYRIGHT Application: Literary, Graphic Videographic, Audio
L
USEFUL IDEA
T
ORIGINAL EXPRESSION
J
Aspect s of produ cts a nd services in th e crea tive indu stries w o rth protecting
DISTINCTIVE IDENTITY TRADEMARK Non-physical Application Badge of identity for Goods or services e.g. logo , shape. sound, color
DESIGN Physical Application Shape, configuration, ornamentation
FIGURE 1_ IMMATERIAL ASPECTS OF THE CREATIVE INDUSTRIES AND CORRESPONDING PROTECTIVE MECHANISMS. BASED ON: GOWERS REVIEW ON INTELLECTUAL PROPERTY, HMSO, 2006.
The phrase "creativeclasses" 22 describes a growing sector of the population whose professional activities are largely reliant on creativity. This creative service is founded in knowledge and information circulated by the "creative class," which produce a wide variety of innovations. This rather comprehensive classification shows that, in the United States alone, approximately 30% of the working population can now be considered to belong to the creative class.
CREATIVE CLASS SUPER CREATIVE CORE
CREATIVE PROFESSIONALS
Computer and mathematical occupations
Management occupations
Architecture and engineering occupations
Business and financial operations occupations
Life, physical, and social science occupations
Legal occupations
Education, training, and library occupations
Healthcare practitioners and technical occupations
Arts, design, entertainment, sports, and media occupations
High-end sales and sales management
CHART 2_ OWN TABLE OF THE "CREATIVE CLASS" ACCORDING TO FLORIDA. SOURCE: FLORIDA, RICHARD, THE RISE OF THE CREATIVE CLASS, BASIC BOOKS, NEW YORK, 2002, PP. 328-29.
22
see: FLORIDA,
RICHARD,
The Rise of the CreativeClass, BasicBooks, NewYork2002.
to ....
SINGAPORE - FROM CULTURAL INDUSTRY TO COPY-
creative industries and hardly quantifiable (for example:
RIGHT INDUSTRY In Singapore, the discussion is
quality oflife). 24 The following pyramid is a clear visual
mainly focused on the economic significance of the
representation:
interface between artistic creativity, enterprise, and
The performing arts, literature, and the visual arts
technological innovation: "...those industries which
are part ofthe "cultural industries"; the "creative indus-
have their origin in individual creativity, skill and talent
tries" also include advertising, design, print, and media-
and which have a potential for wealth and job creation
related activities.
through the generation and exploitation of intellectual property." 23 It defines four types of added value: added value
directly linked to the creative industries and quantifiable (for example: share of gross domestic product); indirectly linked to the creative industries and quantifiable (for example: spillover); directly linked to the creative industries but less quantifiable (for example: contribution to industrial innovation); indirectly linked to the
l
CULTURAL INOUSTRIES
CREATIVE INDUSTRIES
L
COPYRIGHT INDUSTRIES
J DISTRIBUTION INDUSTRIES
FIGURE 2_ PYRAMID CHART WITH HIERARCHICAL LIST SHOWING THE "CULTURAL INDUSTRIES," "CREATIVE INDUSTRIES," AND "COPYRIGHT INDUSTRIES." Source: Ministry ofTrade Industry, Economic Contributions ofSingapore's Creative Industries, 2003.
23
Ministry ofTrade and Industry, Economic Contributions ofSingapore's Creative Industries, 2003.
24
see: HILLMAN, HARRY CHARTRAND, An Economic Impact Assessment ofthe Fine Arts, presented to: Third International Conference on Cultural Economics & Planning, Akron, Ohio, April 1984.
2.2.2 THE EUROPEAN DISCUSSION
The EU commis-
question. Hence, emphasis is placed either on whether
sion is also currently positioning itselfwith a 30o-page
the creativity of the branch can contribute to the unity
study on the economic significance of the cultural sec-
ofEurope, or whether the potential to create can stimu-
tor," and aims to follow up on prevailing political strat-
late growth and employment. Both possibilities indi-
egies with specific priorities and profiles.
cate how a coherent policy on the creative industries is
Numerous European countries are pushing for a
necessary to fully exploit existing potential.
more intense recognition of the issue - the UK with its
A definition developed at the request of the Euro-
own Minister ofCreative Industries and France, as men-
pean Commission 28 outlines four different areas: a core
tioned in Chapter 2.1, with a comprehensive social pro-
cultural area, the cultural industries, the creative indus-
gram.
tries, and related areas that are not yet clearly defined:
The European Union wants to advocate the cultural industries, according to the Cultural Commissioner Jan Figel, as a growing economic branch. An appropriate plan of action will be devised, based on the findings ofan independent study. An outline of the current discussion in the EU is given below; as well as some countries that are considered to have interesting models for this book. EU - lISBON STRATEGY AND CULTURAL INTEGRATION
The discussion on the creative industries in the EU is shaped bythe aims ofthe "Lisbon Strategy,"which are to transform the EU into the "most competitive and dynamic knowledge-based economyin the world, capable of sustainable economic growth with more and better jobs and greater social cohesion." 25 Knowledgeand innovation are considered the driving forces of sustainable growth. The i20Io initiative will contribute to making Europe more attractive for investments and innovation in knowledge-based products and services. 27
_The core of"non-industrial sectors" consists ofnon-reproducible goods and services ("visual arts including paintings, sculpture, craft, photography; the arts and antique markets; performing arts including opera, orchestra, theatre, dance, circus; and heritage including museums, heritage sites, archaeological sites, libraries and archives"). _The cultural industrial sector or the cultural industries comprise cultural products and services destined for themass market or export ("a book, a film, a sound recording, film and video, video-games, broadcasting, music, book and press publishing"). _The third area of creative industries, the "creative sector," understands culture to be thecreative inputinto the production of non-cultural goods ("fashion design, interior design, and product design, architecture, and advertising"). Creativity in thissense is a cultural resource -for example, regarding innovation- in theproduction process ofthe non-cultural sector. _The fourth area of"related industries" consists of crossovers with other sectors (such as information and communication technologies, orrCT), which thestudy was not able to precisely examine.
The creative industries in the EU are discussed either from a cultural-political or economic-political perspective, according to the Directorate-General in
25
Directorate-General for Education and Culture, The Economy of Culture in Europe, Study Prepared for the European Commission. October 2006; Cultural and Creative Industries, Briefing Paper, Policy Department, Structural and Cohesion Policies, Culture and Education, 2007.
25
The Economy ofCulture in Europe, p. 25.
27
see: i20IO - A European Information Society for Growth and Employment, Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee ofthe Regions, Brussels, Iune I, 2005, COM (2005).
28
The Economy ofCulture in Europe, p. 3.
FRANCE - STATE SPONSORING STRATEGIES In France,
the creative industries are also considered an exciting complex of different branches; the people employed in these fields are usually young and have above-average qualifications. Due to the creative industries' ability to integrate new technologies, it is also believed they will play an important role in the locational competition between urban centers, and that the creative industries, in particular the film industry, will boost France's image internationally. 29 As a result, support for these branches
"IJLTlMEDIA At1D
AQV[RTISII1O
VIDEO GAMES
DESIG!'4
"
" PHOTOGAAPKY
ART GALLERIES
was recommended. The French Departement des Etudes de la Prospective et des Statistiques (DEPS) has given the cultural industries ("industries culturelles") the comparatively
ART JllAAKETI AttTIQUES
IC T
TOUAI SM
strict classification of a subsection of a more comprehensive cultural sector. The cultural industries here represent publishing, audiovisual and related services. They also include architecture, the performing arts, and preserving the cultural heritage. 3. Shared elements of
RELLES," "INDUSTRIES CREATIVES," AND "ACTIVITES ECO-
the cultural industries, according to the DEPS, are the
NOMIQUES LIEES" ACCORDING TO THE DEPS.
reproduction and the distribution ofgoods and services through industrialized processes and modern communication technologies. In a further explanation, 31 the DEPS describes the creative industries ("industries creatives") and lists the following branches: the media, literature, music, theater, opera, cinema and video, radio, photography, software, the visual arts, advertising, and collecting societies. The common elements here are the intellectual components of the respective goods and services ("copyright-based industries").
FIGURE 3_ THE BREAKDOWN OF THE "INDUSTRIES CULTU-
Source: Iaurif, les Industries Culturelles en lle-de-Prance, 2006.
UNITED KINGDOM - CREATIVE INDUSTRIES AS A DRIVING FORCE FOR EXPORT AND IMAGE The UKcon-
siders itselfa leader in the field ofthe creative industries and wants to continue developing this position for reasons oftrade, export, and image. Strategies for the creative sector are directly linked to prevailing political ambitions and can be identified structurally. A"Creative Economy Program" supports individuals who are active on various levels in the creative industries.
29 see: Departernent des etudes, de Ia prospective et des statistiques, L'emploi dans Ies professions culturelles en 2003 d'apres l'enquete emploi de l'insee, Donnees de cadrages (Employment in the cultural professions in 2003, according to the insee employment survey. Framework data), 42, 2005.
3. ibid. 31
ro ....
Departernent des etudes, de la prospective et des statistiques, Apercus statistique des industries culturelles, Les notes statistiques du deps (Statistics of the cultural industries), r6, 2006.
The definition of the creative industries, according to the Department for Culture, Media and Sport (DCMS), serves as the model, foundation, or at least a point of orientation for almost all models: "The creative industries are those that are based on individual creativity, skill and talent. They are also those that have the potential to create wealth and jobs through developing intellectual property." 32
DENMARK - THE CREATIVE INDUSTRIES OR EXPERIENCE ECONOMY
The Danish government defines innova-
tion and creativity as the national economy's primary success factors, yet this is no longer a unique selling point. What is interesting, however, is the move to ascribe non-reproducible components of experience to corresponding products and services, so that these become unmistakably distinct on the global market.
The core concepts are creativity, intellectual prop-
The "culture and experience economy" 33 is there-
erty, and employment potential. The following complex
fore defined at the interface between art, culture, and
of branches are classified as belonging to the creative
the traditional industrial sector. It generates added
industries: "Advertising/Architecture/Art and antiques
value predominantly through creativity, and targets a strong client base for the visual arts, leisure, and cultural events. The "culture and experience economy" sec-
markets/Computer and video games/Crafts/Design/ Designer fashion/Film and video/Music/Performing arts/Publishing/Software Television and Radio."
tor consists mainly of branches that exist in other definitions ofthe creative industries:
THE CULTURE AND EXPERIENCE ECONOMY
AND
CULTURE
THE SPORTS II'10USTR"I
TO'l'S/IUIUSE"ErtTS
ARCHITECTURE PRIriTED MEDIA
THE CORPORATE SECTOR
RADIO/TV
THEATRE
800K5
TOURIS"
MUSIC
VISUAL ARTS
T~E
FASHIOr1
THE ARTS
<.
DESIOrt
FILM/VIDEO
AOV[RTISIHO ['-'EHTS
EOUTAlt1MEI"4T
.~
COttTE"' PRDOUCTIOI'1
.. ,
"
CULTURAL Ir'lSTITUTIOrtS
FIGURE 4_ THE "CULTURE AND EXPERIENCE ECONOMY" ATTHE INTERFACE BETWEEN ART, CULTURE, AND THE TRADITIONAL INDUSTRIAL ECONOMY SECTORS.
Source: Denmark in the Culture and Experience Economy - 5 new steps, The Danish Growth Strategy, Government ofDenmark, 2003.
32
Homepage ofthe Department for Culture, Media and Sports: www.dcms.gov.uk.
33
Denmark in the Culture and Experience Economy - 5 new steps, The Danish Growth Strategy, Government ofDenmark,
2003'
GERMANY - THE CREATIVE SECTOR
The significance of
For a number ofyears, there has been a growing number
the creative industries has become indisputable, due to
ofcultural reports submitted at the federal state, urban,
its employment potential and the increasing benefits it
and local district levelin Germany. 34 The heterogeneous
brings to the economy. The working practice ofindivid-
models only reveal a rough outline of a core area, con-
uals involved in this industry is being examined as a
sisting ofthe music industry, publishing, the art market,
promising model for business and added value. The cre-
the film industry, radio, architecture and design, soft-
ative industries indicate cultural diversity and attrac-
ware and computer games, and advertising.
tiveness in cites and entire regions. In Germany, the
A model of the "creative sector" that expands on
Deutsche Bundestag's Enquette Commission (survey
the creative industries, adding governmental and infor-
commission) "Kultur in Deutschland" addresses the
mal players serves as an interesting chart for the study
topic's various aspects.
presented here."
".~" '- '"
'"
SOCIO' ECONOMICA L PARAMETERS
ARCHITECTU RE AND DESIGN (including computer games.
etc.I
\.
-:\"
.
I
,
/ CULTURE AND PRESS\ i INDUSTRIES \ i tbook. art, and music 1 \ markets,film, private f \ ndioflVl /
\ .,······
r
· ·· /
PUBLIC CULTURAL AND MEDIA IN STI TUTIONS rmuseum • theaters, public broadcasting)
···-:::_· .. •"<,-,
'\
;" INTE RACTION WIT H OTHER BRANCHES ANO " GLOBAL PLAYERS "
!
;'
1
SUPPLEMENTARY BRANCHES Iprinrers, musk Instru-
:
menta .•cultural tourism,-
\..
h,ndimft.)
\ \ ' CULTURAL- POLIT IC AL PARAMETERS
...
-.
-,.. J
--
,
-_.
....
,\'o," lrypublicl~ tu nd1."d
FIGURE 5_ THE CREATIVE SECTOR INCLUDING COMMERCIAL, NON-PROFIT, AND PUBLIC AREAS.
Source: WIESAND, ANDREAS J., S6NDERMANN, MICHAEL, The Creative Sector- an Engine for Diversity, Growth and Jobs in Europe,
lZl N
2005.
34
For an overview see: S6NDERMANN, MICHAEL, Kulturwirtschaft- Was ist das? (Cultural industries - what are they?), in: Kulturwirtschaft No.2, 2005. Annual conference ofcultural industries, conference papers, Friedrich Naumann Stiftung, 2005.
35
WIESAND, ANDREAS
J., S6NDERMANN,
MICHAEL, The Creative Sector- an Engine for Diversity, Growth and Jobs in Europe, 2005.
SUMMARY The
chart shows that the list could continue
inclusive definition. It is much more pragmatic to iso-
rather arbitrarily at the European and global level. How-
late the different definitional focuses and then to com-
ever, even a much more comprehensive observation
pare these diverse models. Below, we outline three rec-
would have difficulty providing a clearer notion a gen-
ommended observational methods:
eral definition ofthe creative industries. 36 Is it only those
The first model is characterized by a close rela-
creative products and services that consist of material
tionship to artistic and cultural production. It com-
and intellectual or creative components? Or does it rep-
prises self-employed workers and independent compa-
resent a part ofthe private enterprise system ofa culture-
nies whose main business is the production, distribu-
based sector ofproduction? Does it represent commodi-
tion, and advertising of artistic and cultural products
ties that contain a large percentage of symbolic compo-
and services. The common element between these sub-
nents, and whose value including their added-value
branches and submarkets is the "culture in the broadest
process remains unclear even after consumption (such
sense" factor. This ranges from the individual artistic
as experience goods, trust goods)? 37 Or does it ultimately
idea and original production, to applied arts and the
suggest that the creative industries are not associated
artistic and pop cultural industry, and the mass-media
with specific products and services, but rather entail a
distribution of cultural goods and services. Examples
certain attitude that can be stimulated through specific
here are all culture-related, market-oriented areas such
conditions, such as "technology, tolerance, and talent"?
as music ensembles, sound studios, publishing houses,
It has to be acknowledged that different, parallel
sound storage producers, book and music shops, art
notions ofthe creative industries exist, and that neither
dealers and galleries, concert agents, film actors, film
the market economy nor one-sided content-related defi-
producers and movie houses, architect and designer stu-
nitions are capable ofdefining the phenomenon.
dios, artists' agencies, author and journalists' offices, and agencies for cultural services.
Nonetheless,struc-
The second model focuses on the concept ofintel-
tural criteria can still be determined that can ease orien-
lectual property - meaning the intellectual or imma-
2.3 ATTEMPTING TO SYSTEMATIZE
tation and, in an analysis of the Swiss creative indus-
terial components ofproducts and services that are pro-
tries, can be an international point ofreference. Models
duced by the creative industries. Creative industries
that can be applied or associated to the creative indus-
means here selected creative branches that go beyond
tries originate at the definition level and by analyzing
the above-mentioned art and cultural models and
core arguments.
include the software and games industry, advertising, radio, and television, the media, and relatively new
2.3.1 DEFINITIONAL APPROACHES
The heterogeneity
of the discussions concerning the creative industries
trends not associated with art and culture and solely related to extended sectors."
observed in Chapter 2.2 makes it almost impossible to
Athird model is more generally related to the term
merge all the various different models into one, all-
"creativity" - often without defining or operationalizing
36
WYSZOMIRSKI, MARGARET, Culturallndustries/Creative Sector: Definitional Approach, in: Creative Industries, A Measure for Urban Development,
Vienna, 2004. 37
see: KRETSCHMER, MARTIN, Wertschiipfung in der Kulturwirtschaft (Added value in the cultural industries), in: Tagungsband zur 2. nationalen )abrestagung Kulturwirtschaft, Berlin 2005.
38
see: Innovations- und Technologietransfer Salzburg GmbH, Kreativitat Salzburg - ein Strategiepapier fur eine standortpolitische Schwerpunktsetzung (Salzburg creativity- a strategic paper for setting priorities in local politics), Salzburg, 2005.
....N
it. It includes products and services from practically every
In summary, we can observe a shift in the basic defini-
branch ofindustries that have an element ofcreativity in
tions and demarcations from artistic/creative products
their production. These branches make up only a very
and services of commercial value to those whose value
small part of this definition. New emerging areas here
lies in their application or use in broader economic con-
include the pharmaceutical industry, electronics, ICT,
texts. The above-mentioned examples (for instance,
chemistry, space travel, and the automobile industry. The following diagram lists the approaches side
UNCTAD) also reveal a certain logic behind the diverse
by side. Dividing them into three sections is an attempt
focuses. Political action is shaped by a variety of tradi-
to reduce overly complex facets and overlaps. It also
tions that also affect how different solutions are
allows different models to be compared. The individual
accepted. The amount of influence conventions have
columns are an open line of orientation rather than a
over the way in which the creative industries are under-
selective localization.
stood should not be underestimated.
FOCUS 1: ART/CULTURE AS BRANCHES
FOCUS 2: CREATIVE BRANCHES
FOCUS 3: CREATIVITY IN THE ECONOMY
primary definition focus
primary definition focus
primary definition focus
Artis tic/cu ltural prod ucts and services in the d irect bran ch structure
Products and serv ices with important intellectua l components in extended branches
Products and services. based on crea tivity in th e economy as a wh o le
broader definition focus
broader definition focus
broader definition focus
Employme nt dynamics, creat io n ofvalue, creativity
Employment dynam ics, creatio n ofvalue. creativity. innovation
Employment dynamics, creat ion ofvalue . creat ivity, innovation, imma terial components.
!ypical representative ofthi s theory Switze rla nd . Ger ma ny. UNESCO. ...
!tlJica l relJresentative ofthis theory
typical re resentative ofthis theo!')'
UK. Den ma rk, ...
USA. WIPO.. ..
related terms "Cultu re ind ustries .., "arts and culture industries .., "in dus tries culturclles ..
related terms "C reative industries, .. "indus tries crea-
related terms "Crea tive eco no my.
standard demarcations Music indus tries . book market, a rt market, film ind ust ry, pe rforming a rts. des ign. archi tecture
standard demarcations Softwa re, com puters . design, print. radio. mus ic. film an d video . art. advertisement, architecture, ga mes. fashion. performi ng art. ha nd icrafts
rives»
CHART 3_ THREE DIFFERENT ORIENTATIONS OF THE CREATIVE INDUSTRIES.
N N
standard demarcations Copyright ind ust ries in a na rrow sense, copyright ind ustr ies in a broad sense. patent indus tries . tra dema rk a nd desig n industries
2.3.2 APPROACHES TO AN ARGUMENTATION
When dif-
It is easy to draw a clear distinction between consump-
ferent models need to be described on a definitive level,
tion and production in television, but this is more diffi-
certain arguments will repeat that constitute the appar-
cult with the Internet, and almost impossible in the
ent attractive potential of the creative industries, and
games industry. Various "net-labels" in the music sector
the terms "added value," "innovation," and "creativity,"
now sell music as online downloads rather than CDs.
are given a central role. These will be outlined concisely
The added-value chains based on this principle include
below to clarify how the terms are applied in the crea-
improving the terms and conditions for live concerts by
tive industries, rather than present the most up-to-date
raising the awareness level, or producing "value-added
research.
compilations." Although processes are becoming more transparAdded value is recognized as a complex
ent, and access to the market more varied, the discus-
mechanism in the creative industries. It is related to dif-
sion about added value in the creative industries is still
ferent aspects such as digitization," small-sized pro-
tied to linear models. It seems that a theoretical under-
duction structures." or the ever-smaller divisions of
standing ofcomplex mechanisms is permanently drag-
labor in production processes. Creative individuals, pro-
ging behind the reality experienced in practice.
ADDED VALUE
duction, sales, and consumers are converging, dependencies can no longer be clearly defined, and traditional perspectives are reaching their limits. 41 The following illustration, taken from an interview with John Howkins,? illustrates a very new discussion in the field. Howkins is considered one of the internationally most significant representatives of the creative industries. He attempts to point out that the classic, linear added-value theory of "development-productiondistribution-consumption," is no longer valid, at least for the creative industries, and needs to be replaced by models that are interdependent in more complex ways.
FIGURE 6_ A COMPLEX ADDED-VALUE MECHANISM AS OPPOSED TO A LINEAR MODEL.
Source: GHELIF, DONNA, Understanding the Engine of Creativityin the CreativeEconomy:An Interviewwith JOHN HOWKINS, 2006.
39
see: CHANTEPIE, PIERRE, Decouverte,Paris 2005.
LE DIBERDER, ALAIN,
Revolutionnurnerique et industries culturelles (Digital revolution and cultural industries), La
4. see ideas byCreativeCluster Ltd. (www.creativeclusters.com). 41
see: RITMO - Research for Integrated Trading Models for Online Music (http://www.interactivemusicnetwork.org/w!:-libraries/technologies.htrnl).
42
GHELIF, DONNA,Understandingthe Engine of Creativityin the Creative Economy:an interviewwith JOHN HOWKINS, 2006.
M N
The advantage ofsimplified structures becomes evident
In this model, Phase I corresponds
as soon as added-value models need to be logged statis-
tioned three-tier model. Phase II focuses on prototypes
tically. Complex models that reflect reality quickly reach
or on producing specific services, materials, and tools
to
the above-men-
the limits of available empirical-quantitative data-
that can be applied to the creative industries. Phase III
bases.
corresponds with the second tier ofthe three-tier model,
In response to this, the 1. Kulturwirtschaftsbericht
and Phase IV is the actual front-end presentation of
Schweiz" recommended a three-tier model. Level one refers to the original production of creative products
products and services, corresponding partly to tier two ofthe three-tier model. 45
and services, level two to the introduction of creative
The discrepancy between theoretical depiction
products and services to the end consumer market, and
and the reality ofpractice is obvious. The issue ofadded
level three refers to the reproduction and distribution of
value will be readdressed and discussed in relation to
goods and services through industrialized processes
the creative industries in Chapter 5. Distinguishing
and modern communications technologies. Asimilar, but four-tier model is the CreativeIndustries Production Chain (CIPS) used in the British discussion.
between different concepts ofadded value will lead to a better understanding of the added-value chain in the creative industries.
44
I.
II .
III.
Content origination. authoring
Production. tools
Reproduction and mass distri_b.u _t_io_n
IV. _
Exhibition and sites ofexchange of the ri hts to consume
CHART 4_ LINEAR SEQUENCE OF THE FOUR TIERS OF AN ADDED-VALUE CHAIN ACCORDING TO THE CREATIVE INDUSTRIES PRODUCTION CHAIN (CIPS).
43
WECKERLE, CHRISTOPH, S6NDERMANN, MICHAEL, 1. Kulturwirtschaftsbericht Schweiz (First Swiss Cultural Industries Report), Zurich Univer-
sity of the Arts, 2003.
N
44
PRATT, Co ANDY, Changes in the Cultural Industries in Great Britain, 1998-2002, Paper for Seminar on Cultural Industries, Amsterdam January 2627, 2006, University ofAmsterdam.
45
A new attempt at illustrating mainly linear concepts ofadded-value chains can be found in: Comparative analysis ofthe UK's creative industries, Report to DCMS, August 3,2006, Frontier Economics Ltd., London.
INNOVATION AND CREATIVITY In addition to added
ments for innovation are that the product, process, the-
value, terms such as "innovation" and "creativity" are
ory, or method introduced to the market must be new
common in the discussion on the creative industries.
(in contrast to routine), or at least significantly modified
One reason for this parallelism may well be based
(innovative combinations of existing knowledge). The
in the fact that "innovation," "creativity," and "the crea-
market is an important incentive for innovation, because
tive industries" are assumed to belong to the same con-
the ultimate objective is to improve a company's (mar-
text and are even discussed comparably.
ket) performance. We distinguish between product
The following examples display some definitional
innovation, process innovation, marketing innovation,
features of the concept of innovation 45 that are clearly
and organizational innovation. Creativity is associated
very related to the descriptions ofthe creative industries
with the creative industries because ofits similar termi-
in Chapter
Innovation always involves an aspect of
nology, yet it is also commonly associated with innova-
insecurity. It is also difficult to make prognoses about
tion and, in studies conducted on the creative indus-
2.
the success of innovative models. On the other hand,
tries, equated with developing new ideas - the first
innovation is rarely self-initiated, but is the product of
phase ofthe innovation process. This requires novelties
external efforts. Innovation often has the character ofa
or inventions, which are developed by reexamining
public good since, because it costs less to reproduce
existing problems from a new perspective or by discov-
than to develop, the benefits ofinnovation can rarely be
ering new possibilities ex-nihilo - either through the
reaped bythe developers alone. The subject ofreproduc-
application ofnew technologies or due to changes in the
ibility naturally leads to a discussion ofappropriate pro-
environment.
tective mechanisms. Innovations are related to specific
This first phase is rarely directly related with eco-
relationships within their respective branches, and to
nomic activity; it is less goal oriented and is different
specific locations. They are often analyzed in the con-
from innovation, which is only mentioned when the
text of clusters, path dependencies, or structures of
economic potential becomes clear or after a tangible
interaction between companies and State representa-
product is produced. In this sense, creativity is described
tives, universities, political bodies, etc... Another rea-
as being individual and subjective, and innovation as a
son for relating the creative industries with innovation
group-based and objective concept.
is the Oslo Manual on innovation published by the
Creativity is not only a precursor to innovation but
OECD and Eurostat, 48 which is an important direct and
also as its subset, given that the creative individuals or
indirect source of many passages in creative industries reports and policy papers. The manual describes inno-
classes, which constitute the innovative milieus where innovations are implemented, are subsumed under the
vation as the introduction of new or notably improved
term.
products, services, or processes. 49 The essential require-
46 see: ZINKL, WOLF,Bin Innovationsmarkt fur Wissen und Technologie, Diskussionsbeitrag zur Neuausrichtung der Innovationspolitik in dec Schweiz (2), (An innovation market for knowledge and technology. Discussion paper for a new direction of Switzerland's innovation policy), Avenir Suisse, 2005. NELSON, RICHARD R., WINTER, SIDNEY G., An Evolutionary Theory ofEconomic Change, Belknap Press of Harvard University Press, Cambridge, Massachusetts 1982: LUNDVALL, BENGT-AKE (ed.), National Systems oflnnovation: Towards a Theory oflnnovation and Interactive Learning, Pinter Publishers, London 1992: NELSON RICHARD R., National Innovation Systems, Oxford University Press, Oxford 1993. 47
Oslo Manual, Guidelines for Collecting and Interpreting Innovation Data, third edition, a joint publication of OECD and Eurostat, 2005.
48
ibid, p. 46: "An innovation is the implementation ofa new or significantly improved product (good or service), or process, a new marketing method, or a new organizational method in business practices, workplace organization or external relations." It is important to note that the Oslo Manual repeatedly refers to the theories of JOSEPH SCHUMPETER (The Theory ofEconomic Development, 1934). According to Schumpeter, economic progress results from innovation, in that it replaces old technologies with new ones in a dynamic process ("creative destruction"). He draws a distinction between "radical" innovation and "incrementa]" innovation. SCHUMPETER'S typology ofinnovation (the introduction ofnew products, production methods, the establishment ofnew markets, purchasing channels, the development of new market structures) is also compatible with the Oslo Manual.
10 N
In addition, it can often be observed how little the terms innovation and creativity are used selectively, particularly in context with the creative industries." Added value, innovation, and creativity are now the definitive terms in discussion of the creative industries, yet they have not yet been fully examined. Lines of argumentation are often adopted untested from other areas, and conceptual similarities all too easily translated into content-related dimensions. The systematizing models from chapter 5 onward should be understood as a contribution to a debate that needs extensive continuation.
'9
'" N
see: SCHLEICH, PETRA, Creative Industries und regionale Innovationssysteme, InTeRegWorking Paper No. 22, 2005, Graz, Vienna, February 2005.
3.S
CREATIVE INDUSTRIES SWITZERLAND
The creative industries in Switzerland will be now analyzed with reference to the international discussion. After Fundamental Definitions [3.1] - which might turn out somewhat more complex than the preceding analy-
The creative industries in Switzerland consist of profitoriented cultural and creative enterprises involved in the creation, production, distribution, and medial distribution ofcultural and creative goods and services.
ses - there will be a substantial empirical-statistical
The creative industries are interesting in Switzer-
section. This provides an overviewfor readers with little
land at the moment, because oftheir dynamic economi-
time [3.2] as well as a detailed analysis of 13 sub-markets [303].
cal development and clustered business structure. The
3.1 FUNDAMENTAL DEFINITIONS In the context ofthe
ment and production methods, and is also causing the public to reevaluate the self-employed cultural and cre-
growing significance of these "small creative industries" is due to new technologies and low-cost equip-
broader European and international discussion, it is not surprising that the creative industries have met with
ative professions, products, and services. The products
such great interest in Switzerland. Directly following
and services offered by self-employed people, studios,
the publication of the
Kulturwirtschaftsbericht
agencies, and so on, are recognized as an integral part
I.
Schweiz (First Swiss Cultural Industries Report)," the
ofcultural diversity,and contribute to the attractiveness
City and Canton of Zurich took the initiative and com-
of a city or region. The creative industries are seen as a
piled a creative industries report to serve as the basis for a specific cluster strategy. Additional material was also published on the subject."
diverse network of related industries that, due to how they interconnect, comprise different functional fields
It not only focuses on the absolutely crucial, poten-
tial employment possibilities offered by the creative industries, but also on the fundamental question of which changes the economic region of Zurich might generate, and which areas of"intellectual property" will shape the key industries in the region ofZurich over the coming ten years.
that need to be examined as a whole, if the creative industries are to provide a sustained contribution to growth and employment. These relationships can be illustrated using the "three-sector model" below: This model, which is established in Switzerland, chooses to focus on the individual entrepreneur or the creative professional, and divides the cultural sector into three sub-sectors, as illustrated above. While the public and the intermediate sub-sectors are not profit
5.
WECKERLE, CHRISTOPH, S6NDERMANN, MICHAEL, 1. Kulturwirtschaftsbericht Schweiz (First Swiss Cultural Industries Report), Zurich Univer-
sity ofthe Arts, 51
2003.
see: WECKERLE, CHRISTOPH, S6NDERMANN, MICHAEL, Kreativwirtschaft Zurich, Der privatwirtschaftliche Teil des kulturellen Sektors im Kanton Ziirich (The creative industries in Zurich, the commercial section ofthe cultural sector in Canton Zurich), Zurich University ofthe Arts, 2005; KLAUS, PHILIPP, Stadt - Innovation - Kultur, Kulturwirtschaft und kreative innovative Kleinstunternehmen in der Stadt Ziirich (City-innovationculture, cultural industries, and creative innovation ofmicro-enterprises in the City ofZurich), Seismo, 2006.
•••• STATE ---------
•
two chapters regarding the concerned professions and
."
their business models. 3.1.1 THE DIVERSITY OF THE BRANCHES: CREATIVE
PUBLIC SE CTOR
PROFESSIONS
.,/
One characteristic feature ofthe creative
industries is that it can be understood as a "cross-sectional" branch, the sum ofdifferent economic branches from the production, service, and trade sectors. This is the fundamental difference between the creative industries and traditional (e.g. automobile or chemical) INTERMEDIAT E SECTOR
ECONOMY
industries, which can be described as homogenous branches in the production sector. In this sense the creative industries are related to the media or IT industries, which are also complexes ofinterlocking branches.
·CIYIL SDCIOY
Nonetheless, international classifications attempt to define the creative industries according to statisticsystematic aspects and not according to more realistic sub-markets. Hence, book and media publishers are FIGURE 7_ THE THREE-SECTOR MODEL SUBDIVIDES THE TOTAL CULTURAL AREA INTO PUBLIC, INTERMEDIATE, AND
merged with record companies to form the publishing industry, or businesses trading in art works, music sup-
PRIVATE SECTORS.
plies, music instruments, and sometimes books are grouped under the cultural goods industry sector. oriented, the private sector is considered commercially oriented and is called "the creative industries." The subsectors are connected by a "capillary" system of exchanges. The creative industries develop the creative potential of the public and non-profit sub-sectors, and retroact on them innovatively,at least in principle. As a result of this complex interdependence and the constant change associated with it, the creative industries can only be understood as an open system.
OJ
accordance Schweiz. 52
with
SUB-MARKETS
the
1.
Kulturwirtschaftsbericht
This study, therefore, considers the cre-
ative industries to consist of 13 sub-markets. Most offer
Modifications in definitional focal points and the developments regarding the classifications and overlapping
products and services that target either other production or service branches, or the end-consumer market directly. The press industry and the audiovisual equip-
with other branches are therefore considered constitu-
ment market are two sub-markets with complementary
tive. These aspects will be considered in the following
or supporting properties.
52
N
The Swiss form of the creative industries is more detailed than international models, and includes additional sub-markets that were documented in direct
WECKERLE, SONDERMANN,
1. Kulturwirtschafrsberichr Schweiz, p. S1.
SUB -SEGMENT
FREELANCE AND SELF -EMPLOYED PERSONS CREATIVE PROFESSIONS
COMPANIES AND ENTERPRISES
1. MUSIC INDUSTRY
Composers, musicians. music teachers, sound engineers . interpreters. music ensemb les. etc.
Instrument manu facture, music publishers, record companies, agencies. musi c sto res. event manager s, clubs , musical festivals, commercial music schools. etc.
2. BOOK MARKET
Writers, autho rs. journal ists . word produce rs, etc.
Book publishers. who lesale books elling, bookselling, agents. etc.
3. ART MARKET
Visual artists. art restorers. art teachers. etc.
Gallery, art dealer. museum shop. commercial art exhibitions. etc.
4. FI LM INDUSTRY
Screen writers . movie acto r/actresses, film producers. etc.
Film and television production companies, film sales and distributio n, movie houses, etc.
5. RADIO INDUSTRY
Presenters. speakers. producers. etc.
Radio and television enterprises . etc.
6. PERFORMING ARTS MARKET
Performing artists. artistes, dancers. cabaret artistes, etc.
Commercial thea ters . musicals, agents, variety theaters. caba rets, etc.
7. DESIGN INDUSTRY
Designers. craft and applied artists, etc.
Industrial design offices. product design. graphic design, visual design. Web design , etc.
8. ARCHITECTURE MARKET
Architects . landscape architects. etc.
Civil engineering architectural offices interior archi tecture , landscape design , etc.
9. ADVERTISING INDUSTRY
Copywriters . advertisers. etc.
Advertising offices . advertising distribution. etc .
Sofr.vare and games developers, etc.
Software con sulting and development, software publishers programming compa nies, agents. etc.
11. HANDICRAFTS
Artisans, gold and silversmi ths. etc.
Applied arts, processing precious stones and gemstones, manufactu ring jewelry, gold an d silver products. etc.
12. PRESS I NDUSTRY
Writers, authors, jou rnalists, wor d producers. etc.
Media pub lishers. newspaper agents. press archives. etc.
13. AUDIOVISUAL EQUIPMENT MARKET
(see music an d film industry)
Manufacturers an d dealers in film. radio. and audio equipment. etc.
HI.
SOFTWARE AND GAMES INDUSTRY
HART 5_ THE MAT IC CLASSIFICAT ION OF T HE CREATIVE INDUST RI ES.
The first six to eight sub-segments in the above chart are
3.1.2 THE DIVERSITY OF CREATIVE PROFESSIONALS:
considered part ofthe classical cultural industries. Spe-
BUSINESS MODELS
cialists often refer to them as the "cultural industries"
branches, creative professionals work full- or part-time
[see the UNESCO definition in Chapter
Within and beyond this complex of
This par-
as freelancers or employees, and in a variety of constel-
ticular concept is more important in countries with sig-
lations. They can be temporarily engaged or employed
2.2.1].
nificant State cultural funding, especially ifthe interest
long-term, can be active locally or internationally, and
lies in policies that integrate both economic and cul-
their work can be based on existing structures or may
tural aspects (keywords: double character, cultural and
even deliberately avoid them. Most of the definitions,
economic goods). However, the concept ofthe "creative
classifications, and theories examined in Chapter
industries" (in particular the British model) is becom-
fail to consider this when speaking generally about "cre-
2.2
ing increasingly popular for purely economic reasons. It
ative professionals" or the "creative industries." The fol-
focuses on the sub-markets of design, advertising, and
lowing three-tiered business typology provides an inter-
software and games, in addition to the classical cultural
esting differentiation:
industries
[SEE CHAPTER 2.2.2].
The three-tiered business typology in the chart above takes into account that each classification of the creative industries is one step closer to the actual reality of the industry. It also takes into account that relevant branches, professions, or activities might exist outside of the observed field. Nonetheless, looking at production and financing mechanisms, the following points out that significant differences exist between the three types ofenterprises.
I.
II.
Creative scene
Established small- and midsized creative industries enterprises
CHART 6_ THREE-TIERED BUSINESS TYPOLOGY.
lZl I"l
III . Established large and vel)' large-sized creative industries enterprises
Creative workers outside the creative industries
To describe the different
production and communication processes often follow
business models in the creative industries, it is impor-
standard structures. Contrary to the creative scene, sta-
tant to observe that the divisions between the three
bility, durability, or reliability are the main business
PRODUCTION MECHANISMS
types are not absolute; the transitions are fluid and,
principles, and the complexity of solutions is largely
according to the branch in question, elements of one
kept under control. Innovations result from the capacity
type can be decisive for another. The following descrip-
to develop new products or product varieties within the
tion will be developed in detail later in the chapter, and
norm. However, the focus remains on trusted product
should be understood as the representative ideal:
criteria and reproductions ofstandard products.
THE CREATIVE SCENE:
Professionals in this field gen-
CREATIVE PROFESSIONALS OUTSIDE THE CREATIVE
erally work in temporary constellations with highly flex-
INDUSTRIES: These individuals
ible processes for production and communication, thus
or from established enterprises) should be counted as
(from the creative scene
keeping fixed costs at a minimum. The independence
members of the value-added chain of businesses exter-
this situation permits is ideal for experiments and inno-
nal to the creative industries. The way they think and act
vative work, yet such limited resources also ensure that
assigns them the role of innovative problem solvers or
the complexity of solutions remain manageable. The
problem spotters (often associated with a research and
results are primary prototypes, single-unit productions,
development department). Problems are formulated
and limited series.
externally and solved in laboratory-like situations under optimal conditions. Because they have access to
ESTABLISHED ENTERPRISES:
In the creative industries,
these are characterized by operational structures that
resources and the appropriate facilities, they can develop highly complex solutions.
can be recognized from the outside, and accordingly,
... M
FINANCING MECHANISMS Discussions with individuals
from different creative branches have shown that the business typology can also be applied to the creative industries' financing mechanisms. Here, it is important for the creative industries to be precise about the outside- and self-financing categories. Self-financing specifies the extent to which products and services can be marketed, or whether access to the market can be established at all. Outside financing specifies whether an individual and his or her products and services are considered worthy of sponsoring or financing. The following model illustrates the creative scene and established businesses within the creative industries:
~rlllb(lJic hlMnCIJI
capual capital
i~
added
10
0% :
z;
u .
:> u.
: :
l:l z; i! ! , ..J
~ w ~ w
' :
: :'
c:~[Jbh!loh(..d
large enter -
priscs
! -.
-.:\\-. '\:,,'~-------~-----
::::~~..
\:.:_
~.~~.~.
established ..null enterprises
..c('ne
lone of compensation: mi~'iing rin.mcial c-lpif-ll is compeu ...ucd
b~
ItU.'symbolic
FIGURE 8_ FINANCING MECHANISMS FOR THE CREATIVE INDUSTRIES,
The self-financing axis (investment resources) specifies the extent to which products and services can be marketed and whether access to the market can be established. The outside financing axis (loans, specific public sponsorship) specifies whether an individual and his or her products and services are considered worthy ofcredit or sponsoring. Yeta distinction should be drawn between monies from the private sector (or bank loans) and monies from public sector (sponsorship for publishers or films).
N M
From the perspective of financing, the "creative scene"
3.1.3 CREATIVE PROFESSIONS, BUSINESS MODELS,
is both specific to and constitutive ofthe creative indus-
FIELDS OF ACTIVITY - AN INTEGRATED PERSPEC-
tries. It has become an area with little access to public
TIVE The attempt in the chapters above to define the
funding. Individuals active in the creative scene are not
creative industries by example of professional area and
usually creditworthy in the eyes ofbanking institutions,
branch classifications, business typologies, and financ-
nor are they generally in a position to fund themselves -
ing mechanisms might at first seem trivial. Yetit differs
hence, their products and services have difficulty access-
from most other observations, which do not usually
ing the market.
introduce these differences, because the business praxis
The fact that the creative scene deliberately posi-
generally fuses all contributing factors and competences
tions itselfwithin an area that classical business devel-
together. Viewing these factors individually however,
opment deems less attractive is the "paradox ofthe cre-
reveals that structurally contingent potential can be
ative industries." It draws on various mechanisms of
found in everycomplex ofbranches in the creative indus-
compensation. Fragile capital resources are supported
tries - between professional and entrepreneurial compe-
by a much-reduced imputed entrepreneurial profit and
tences as well as in their application in fields ofactivity.
by symbolic capital
[SEE CHAPTER 5].
The lack of bor-
The analysis ofthe creative scene in Chapter 5 and
rowed capital can be offset by multi-track job profiles
the development of relevant instructions in Chapter 7
(such as employment in the public sector) or by public
are based on these differences and operationalize them
funding" (the three-sector model's capillary exchange
with a view to producing concrete models of funding.
relationships: commissions, transport and running costs, scholarships, sales, year-long work grants, specific commissions, catalogs, studios, infrastructure, CREATIVE INDUSTRIES
further education, consulting, etc.). Representatives from all the creative branches
CREATIVE SCENE
have also confirmed this situation for Switzerland. All seem to point to the fact that few sub-markets contain significant, large, established businesses, but are domi-
CREATI VE PROFESSI ONS
BUSINESS MOD ELS
nated by small, established business and the creative scene's microstructures - a conclusion that will be FI ELDS OF ACTIO
repeatedly confirmed in the following empirical-quantitative chapters.
FIGURE 9_ DIFFERENT PERSPECTIVES OF THE CREATIVE INDUSTRIES: PROFESSIONAL AREAS, BUSINESS TYPOLOGY, AND PRAXIS ASPECT.
53
see WECKERLE,
CHRISTOPH; YOLK, ANDREAS,
Die Rollevon Kultur undKulturpolitik in den schweizerischen Aussenbeziehungen (Theroleof
culture and cultural politics in Swiss foreign affairs), Swiss National Science Foundation synthesis report, '999, chapter 3.
eo l"J
3.2 EMPIRICAL OVERVIEW The empirical overview
Instead of providing strict classifications, such as "the
presents a compact picture of the Swiss creative indus-
book and press industry," links can be chosen flexiblyto
tries, which will be explained in more detail in the subsegment profiles below.The overviewis directed at read-
perhaps create a new complex of branches from the book, design, advertising, and press industries, while
ers who prefer a quick, general picture rather than a
basically retaining the internal structure of the respec-
detailed examination ofthe sub-market portraits.
tive sub-market. Several professional associations that
The first section [3.2.1] contains a statistical classification of the Swiss creative industries, and discusses the
are interested in conclusions, as true to the branches as possible, have suggested developing this new version of
strengths and weaknesses of statistical approaches
sub-markets.
[3.2.2]. Then, structural data on the creative industries
Working out the interconnections and functional
in Switzerland are presented [3.2.3], followed by a
relationships between the sub-markets will be an
description ofdevelopments since 2001 [3.2.4]. The fifth section [3.2.5] offers a short overview of the different branches, followed by a closer examination of a few
important task in the future, because it is becoming increasingly difficult on the levelofstatistical classification. For instance, online trade and the Internet - pro-
selected sub-segments [3.2.6].
viding they activate economic activity for the creative industries - is very difficult to classify statistically.
3.2.1 NEW STATISTICAL CLASSIFICATION OF THE INDIVIDUAL SUB- MARKETS The statistical categoriza-
The 2007 statistical classification ofthe Swiss creative industries was developed on the basis of NOGA,
tion is geared to the classifications within the creative
the Swiss General Classification ofEconomic Activities
industries that were presented in Chapter 3.1.1. Individual sub-markets are divided into independent base units
[SEE CHAPTER 3.3.1].
tion system of the Swiss national economy subdivides
and are not gathered into a complex ofbranches.
the entire economy's respective economic activities
In both a narrow and broad sense, this is a shift from the method in the I. Kulturwirtschaftsbericht Schweiz of interconnecting the related sub-markets. It allows different sub-markets to merge and form new, variable groups in line with the chosen perspective.
e-
M
This official, binding classifica-
according to department, group, and sub-segments (business classification). The following business classifications will be examined in detail for the creative industries in Switzerland, and assigned to the 13 submarkets:
SUB-MARKET 1. MUSIC INDUSTRY
NOGA-No .
~2.
31B
BB.42B 22 .l4A 22.3BA 36.3BA 5 2. 4 5 C 52.450 ~2.32A
92.32B 5 5 . 4 BB
2. BOOK MARKET
~2.3l0 ~2.4BB
22.11A 52 .47A
3 . ART MARKET
~2.31C ~2.J10
52.4BO ~2.52A
52.5BA
4 . FILM INDUSTRY
~2 .J1A ~2 .11A
~2.12A ~2.1JA
5. BROADCASTING I NDUSTRY
~2.2BA ~2.2BB
6. PERFORMING ARTS MARKET
~2.31A ~2 .J2A
92.32B 92.34A
7. DESIGN I NDUSTRY
74 .2BO 74.878
74.4BA 74.14A
74 .B1A 74.97C
8 . ARCHITECTURE MARKET
BRANCH DESCRIPTION, BUSINESS ACTIVITY Orchestras, choir, m usician s (including self-employed musicians) Schools of the a rts (includ ing self-employed music teachers) (sha re 20%) Publishers ofsou nd record ing media (CDs/DVDs/CD-ROMs) Repro ductio n ofCDs/ DVDs/CD-ROMs Manu facturing of m usical instrument s CDs/DVDs/CD-ROMs reta il indus try Musical instrum ent s reta il indu st ry Thea ters, ope ra hou ses , playhouses, and co ncert halls oj Oth er au xiliary services for culture a nd entertainment (including so und stud ios) oj Discos, dancing events , night club s (exclud ing bars) o' Oth er arti stic activitie s and performance s (includ ing writers , a utho rs) Self-em ployed journa lists Book publishers (including music publishers) Retail book trade Self-em ployed visual a rtists Other artistic activities and performances (including restorers) 0' Art dea lers (retail trade with objects ofcontemporary art) Museums (including commercial elements (share 15%) Antiques retail industry Theater a nd ballet com panies (including self-employed stage arti sts and directors) oj Film, TV, video manufacturing Film distribution and video program providers Cinemas Radio channels (co mpanies) Television channels (compan ies) The ater and ballet companies (including self-employed stage a rtists)" Theaters, opera houses, playhouses and concert halls oj Other culture and entertainment services oj Additional culture and enterta inment facilities (circus, self-employed acrobats, puppet theater Industrial design . other engineering offices (share 10%) Product and graphic design Communications design , advertising design Communications design, company consultants (share 10%) Photo design , photo stud ios Exhibition design, exhibition and trade fair industry
74.2BG
Architects' offices Interior designers ' offices Landscape architecture
9 . ADVERTIS ING I NDUSTRY
74.4BB
Advertising, advertising distribution
1 S . SOFTWARE AND GAMES INDUSTRY
72.2
Software an d games development and consulting
36.22A
Workm anship of precious stones and gemstones Manufacturing ofjewelry, go ld, and silver goods Manufacturing ofother ceramic products otherwise not listed
74.2SA
74.2BB
11 . HANDICRAFTS
36.22B 26.25A
12 . PRESS I NDUSTRY
52.47B 22.12A 22.13A 22.15A 74.858
13. AUDIO INDUSTRY
J2.J8A 52.458
0'
Retail trade with newspa pers and magazines kiosks Newspaper publishers Magazine publishers Other publishers Tran slation agencies Manufacturing ofradios and televisions and audio equipment Retail trade with rad io and television equipment
C H ART 7_ STATISTICAL CATEGORIZATION OFTHE CREATIVE I N DUST RI ES, 2007, ACCORDING TO NOGA CLASSIFICATION.
NOles: ., business classification ass igned to several sub-markers. Shares given in percentage values =fractional inclusion ofactivity. Source : NOGA General Classification of Economic Activities, Swiss Federal Statistical Office (SFSO) .
3.2.2 STRENGTHS AND WEAKNESSES OF THE STATISTICAL BASIS
The existing categories according to the
NOGA General Classification of Economic Activities makes it possible to use and evaluate the different statistical data sources provided by the Swiss official statistics [SEE CHAPTER 3.3.1]. The following strengths and weaknesses are associated with the relationship between the classification ofbusiness activities and official statistics: THE STRENGTHS
_ Throughout Europe, empirical studies of the complex of branches in the creative industries are based on official statistics. _ It isthe only database available that can be used to carry out cross-branch evaluations on a unified methodological plan. Accessing data sources associations and organizations is not an option, due to the heterogeneity oftheir data. _ European-wide conventions can be tested by connecting official statistics with the European-wide NACE classification of business activities (Switzerland has joined thissystem with the NOGA).
_ The State regularly commissions the collection of official data, so that statistic analyses can be continually updated according to the same research plan. _ Official statistics are more accepted in politics, science, and the media.
'"
M
or digital inform, there are more and more possibilities of"gauging" or "assigning" to defined activities. A clear relationship to one business branch is becoming increasingly dllflcult. _ Individually economic forms of activities can be too small to be clearly, statistically classified, meaningfor instance thatweb design can belong under IT, design, or the Internet. _ The system ofstatistical classification was developed forthe production industry over one hundred years ago. New forms of services no longer fit these older forms of the material valueadded chain, because they are in a continuous process of change. _ The creative industries' activities are increasingly practiced outside of the definitive or traditional structure of organizations, associations, or chambers, making it dllflcult to collect data onjlexible, project and network-related activities of the creative industries. _ Official data are often available only after atwo-year delay, because they need to be checked by the tax authorities before being statistically processed. One of the most significant restrictions of statistics should be mentioned here, to give the reader an impression of additional market shares in the creative industries that are either very difficult to establish or cannot yet be established using statistical methods.
THE WEAKNESSES
The empirical examination of companies and turnovers is based on the Swiss VAT Statistics. Since these statistics includes only businesses with an annual
_ Documenting new economic activities presents serious problems for classifications experts in official statistics, especially regarding the creative industries. _ Because they mostly involve service-oriented activities that
taxable turnover of CHF 75 000 (approximately EUR 50000) or more, a significant area ofthe creative industries is missing. Small firms and freelancers with an annual revenue ofless than CHF 75 000 cannot not be
are becoming less material, but rather increasingly immaterial
statistically recorded and analyzed.
The significance of the creativeindustries' activity that is
and in this business group represent approximately
missing from the above statistical analysis can be estimated using data from neighboring Germany. The sales
3.4% ofthe total turnover. In the Swiss context, this would mean that -
tax statistics of the German Department of Statistics, Destatis, separates the group of businesses with turn-
according to the market segment - between 20 and 50% ofsmall businesses and freelancers are not statistically
overs of more than CHF 75 000 from those with an
documented. Their economic potential may first seem
annual turnover ofless than CHF 75 000. Here, 79% of publishing enterprises generated annual turnover of
insignificant to the creative market as a whole, because
CHF 75 000 and more. This business group covers 99.8% of the turnover of all publishing enterprises together. 21% of the enterprises haveannual turnover ofless than CHF 75 000. Their total turnover is a negligible 0.2%.
their share is not more than 3 to 4%. Yeta comprehensive presentation of the market structure reveals that their potential is actually quite significant, since a design bureau with an average annual turnover ofless
The following corresponding values can be found
than CHF 75 000 can have an economically relevant size and can also participate in the market.
in the group "culture, sports, and entertainment,"
In total, statistics allow a view into a sub-segment
which contains the core group ofartistic, cultural, and
of the creative industries. The more institutional, or
creative professions: 47%, i.e. almost half of the businesses, havean annual turnover ofless than CHF 75 000
more formal the activity, the easier it is to perform an empirical analysis using available statistics. The more
Scaleof turnover taking Germany as an example, share in "10 (Selection:the publishing industry, culture, sports, and entertainment)
Business class
Business
Annual turnover
share in Ofo
sharein %
a) in the publishing industry business group with an annual turnover ofCHF 75,000 and over
with an annual turnoverof less than CHF 75 .000
21 %
0, 2%
b) in the culture, sports, entertainment business group with an annual turnover ofCHF 75.000 and over
with an annual turnover ofless than CHF 7 5.00 0 CHART 8_ CONCRETE WEAK POINTS BASED ON THE VALUE-ADDED TAX (VAT) STATISTICS.
Note: The areas marked in italics are not collected in the Swiss VAT Statistics. Publishing industry (NACE No. 22.1), Culture, sports, entertainment (NACE No. 92). Source: Sales Tax Statistics, Destatis: Creative Industries Research Unit I z adx, own calculations.
informal the creative industries' activities are, espe-
one-person enterprises are common (57% of the crea-
cially regarding the creative scene, the more difficult it
tive industries). According to the Swiss State Secretariat
is to rely on statistics.
for Economic Affairs (SECO), a business with up to nine
Because the statistical analysis has been able to
employees is a small business, and as many as 92% ofall
record and describe only one part of the creative indus-
creative businesses would belong to this category. The
tries, the qualitative analysis in Chapter 5 is a funda-
number of employed persons in workplaces totaled
mental addition. Developing new models creates
approximately
entirely new or different approaches to the creative
employees working in enterprises belonging to the cre-
industries' microstructures. The theories developed are
ative industries sector. In the broader Swiss economy,
a forward-looking addition to approaches to this
the average of ten employees per workplaces is double
201 000.
There is an average of five
"small" creative industry. The creative scene's increas-
that number. The dominating aspect ofthe micro-enter-
ing variability and heterogeneity in both small and
prises in the creative industries is not a Swiss phenome-
established creative businesses will require statistics
non; it can be observed throughout Europe. For instance,
more than ever.
in Germany, micro-enterprises comprise a total of 90%
Chapter 3.3 contains an interpretation of the 13
ofthe total creative industries sector. In
sub-market profiles, emphasizing that the empiricalqualitative analysis may be well developed and allow
2005,
the creative industries produced a total
turnover of CHF 61.7 billion. This includes taxable
differentiated statements, but it can shed light on only
national turnovers ofCHF 45.8 billion as well as tax-free
one part ofthe creative industries.
turnovers (mainly export) ofCHF 15.9 billion. The proportion of the creative industrial total turnover in the
3.2.3 STRUCTURAL DATA OF THE CREATIVE INDUS-
total Swiss economy is 2.5%. This value emphasizes the
TRIES IN SWITZERLAND In
there was a total of
Swiss creative industries, as Switzerland overall also has
40 553 businesses in the creative industries, including the freelance cultural and creative professions. In the
extremely high banking turnovers (18%ofthe Swiss total
creative industries in Switzerland, these include the 13
tries is thus a better indicator. This lies at 6.1% of the
sub-markets: music, books, art, film, broadcasting, performing arts, design, architecture, advertising, soft-
total taxable turnover ofthe Swiss national economy.
ware and games, handicrafts, media and recording. All
CONCLUSION A first overall conclusion can be formu-
taxable enterprises are included in the creative indus-
lated for the Swiss creative industries: the creative
200 5 ,
tries that are active on an operational basis. In 2005, the
industries, made up largely of micro-enterprises, pro-
number of workplaces (enterprises, branches, offices,
vides more than
studios, etc.) totaled approximately 41 600.
produced a turnover volume of CHF 61.7 billion in
The minor discrepancy between the number of
cc
M
turnover). The taxable proportion of the creative indus-
2005.
200 000
full- and part-time jobs, and
According to a conservative estimate, the creative
businesses and their workplaces is the first reference to
industries therefore contributed CHF 19.5 billion to
the microstructure of the creative industries. In fact,
the Swiss gross added value. This is the equivalent of
Creative industries
Creative industries
4-year change in %
2°°5
2005/2001
2001
38 °95 12.6 3° 29 99 54 239 3. 2 1696 291
Numb er ofbusin esses % ofoverall economy overall economy Total turnover in CHF million % ofoverall economy overall econom y in CHF million Taxable tu rnover % of taxable overall econom y Jobs % ofoverall economy overall economy Emp loyed people ' ) % of overall economy overall econo my
44 550 11.6 382 985 209 765 5·7 3 67 1 750 18 98 3 4·5 4 22485
Added value in CHF million b) % ofoverall econo my overall econo my (GD P) in CHF million
4°553 12·7 319 823 6166 5 2·5 243 1944 45774 6.1 155° 4 Il.2 37 2549 201 127 5·4 3 698 734 194 86 4·3 45 94
6,5 5. 6 13·7 43-4
-6·7 -2·7 -4. 1 0·7 2.6 7. 8
CHART 9_ KEY DATA OF THE CREATIVE INDUSTRIES IN SWITZERLAND 2001/2005.
Notes: Total turnover including tax-free exportaswell as taxable turnover;
a)
full- and part-time; b) Estimate; Average amountperemployee
65000 EURO. 1 EURO = 1,5 CHF.
Sources: VAT Statistics, FTA; Swiss Business Census, Swiss Federal Statistical Office (SFSO); Creative Industries Research UnitI zndx, owncalculation.
approximately BUR13billion. Compared with 2004, the
overall economy. The 43.4% growth rate of turnover in
percentage ofthe creative industries in the gross domes-
the overall economy was three times that which the cre-
tic product (GDP) is 4.2%, and can be situated between
ative industries could have generated in the same time
the watch industry (2.5%), the chemical industry (3.4%),
frame.
and health and welfare (5.8%). The financial sector, con-
The creative industries demonstrated above-aver-
sisting of banks and insurance companies, with an
age growth between mid-r99s and 200r/2002,54 yet the
added value of8.9% in the GDP remains unsurpassed.
situation in the first halfofthe new decade did not continue in the same manner. On the contrary, the creative
3.2.4 THE DEVELOPMENT OF THE CREATIVE INDUS-
industries made nominal losses in turnover in 2003. The
The development ofturnovers
first signs of growth began to appear in 2005, the last
TRIES IN SWITZERLAND
in the creative industries, with a growth rate of 13.7%
surveyed year. The total creative industries' turnover
over a period of four years (2001-2005), was superior to
increased by an above-average growth rate of 14%
growth in the number of creative businesses. That
between 2004 and 2005, achieving almost the same
means that the average turnovers of individual creative
dynamism ofthe overall economy's r8% increase during
industries' enterprises must have improved. On the
the same period.
other hand, during this period, the creative industries
The 2.6% added value of the creative industries
could not have kept up with the trading volume of the
in 2005 was an improvement over 2001. However, the
Proportion ofthe gross value in selected compared branches added in % ofgross domestic product
"10 10 .0
8.0 6 .0
2.0
0.0
Financial invtitut iuns
Hcalthcarc
Creative industries
----
Chemical industry and[he lik("
watch manufacturers and the like
FIGURE 10_ ADDED VALUE OF THE SWISS CREATIVE INDUSTRIES IN COMPARISON (2004).
Notes: Gross value-added of2004 prices, selection ofbranches according to NACE No. 65, No. 85, No. 23-24, No. 33. Creative industries calculation. Source: Production and VAT statistics 2004, SFSO; Creative Industries Research Unit I ZHdK: own calculation.
54
"'"
see Kreativwirtschaft Zurich, Synthesis Report, 2005.
Changes in the Swiss Creative Industries between 2001 und 2005 in Ofo
%
10 .0
0.0
- 10 . 0
1"0[,]1 turnover
I\ dded \'3Iue
Companies
Wo rkpl aces
Employees
Note: Change in %, Basis 2001=100%. Sources: VAT Statistics, FTA; Swiss Business Census, SFSO; Creative Industries Research Unit I zHdK; own calculation.
Proportion ofthe Swiss Creative Industries in the Overall Economy in Ofo
(2005)
%
14·0 12 . 0 10 .0
8 .0
6.0 4 ·0 2 .0 0 .0
Companies Itnxable]
FIGURE 11
workplaces
Employees
(studios. offices, tfull-Jpart-rimej en terprises)
Total turnover..1 of which .
Gross
taxable turnover added value-b)
DEVELOPMENT AND SHARES OF THE SWISS CREATIVE INDUSTRIES COMPARED WITH THE
ECONOMY AS A WHOLE.
Notes: ,) including tax-free exports etc; b) estimate. Sources: VAT Statistics, FTA; Swiss Business Census, SFSO; Creative Industries Research Unit I zudx, own calculation.
percentage of GDP remained the same, because the
higher employment losses. The level of employment
overall economy rose 7.8% in four-year comparison. The complex ofbranches within the creative indus-
remained relativelystable, with a decrease ofonly 0.7%.
tries now comprise more than one tenth of the Swiss economy. Yet it is clear that the changes in this business
CONCLUSION Asecond conclusion is that creative enter-
decreased by 4.1% whereas the overall economy
landscape are contradictory. For one thing, the number
prises have concentrated their activities down to fewer
of taxable enterprises experienced favorable develop-
workplaces. Established enterprises have disappeared, even if the loss here is not as high, yet the number of
ments between the comparative period of 2001 and 2005 - growing by 6.5%, stronger than the overall Swiss economy (5.6% growth). With this, almost 2 500 new companies flooded the creative industries, which made its share in the overall Swiss business landscape increase slightly to 12.7%. For another thing, there was a clear structural
one-person enterprises on the market is increasing. These diverging developments further support the trend in business and workplaces toward a small branch structure, making an increase in added value a challenge. Chapters 6 and 7 deal with approaches that can initiate appropriate measures.
change in the number ofworkplaces. The creativeindustries lost almost 7% of their workplaces. In absolute
3.2.5 THE SWISS CREATIVE INDUSTRIES IN AN
numbers this means that 3 000 workplaces were lost.
OVERVIEW OF THE BRANCHES Different to mono-indus-
This market decline affected the creative industries
tries such as the chemical industry, the concept of the
much more that the overall economy, which lost a total of 2.7% ofworkplaces during the four-year comparative survey period. The decrease in workplaces means that
"interconnecting branches ofthe creative industries" is very familiar in discussions concerning the subject. It comprises various sub-markets. The individual culture
places of business, agencies, and other office-like sites
and creative markets can exist in a relationship ofinterchange. There are also independent branch segments
became redundant. Production or services offered by a company were reduced to fewer locations. This trend can be seen in the overall economy, but not with the same intensity as in the creative industries. Structural changes ofthis type alwayslead to a loss of jobs as well. In fact, the volume ofemployment developed negativelyin the creativeindustries. In the comparative four-year period, 8 600 jobs were lost, bringing the figure down from 209 800 in 2001 to 201 000 in 2005. Compared with the overall economy, it once again becomes clear that the creative industries suffered
N
-e
that coexist. The following distribution in percentages applies to the creative industries in Switzerland:
MUSIC
6.S% AUDIO -& .0 %
SOFTWARE AND GAMES
'5·9%
-¥
4.7% ~
ADVERTISING
OESION . ' 1t.8%
-'
: : PERFORMING ARTS ARCHITECTURE
;.8%
17·5"10
FIGURE 12_ DIVISION OF BRANCHES IN THE SWISS CREATIVE INDUSTRIES ACCORDING TO OCCUPATION (2005). TOTAL NUMBER OF EMPLOYEES: 201127
Note: Self-employed and employed persons in full- and part-time jobs. Sources: Swiss Business Census, SFSO: Creative Industries Research Unit /zHdK: own calculation.
The largest sub-segments are design, architecture, soft-
demonstrates an above-average growth rate of almost
ware and games, and parts of the press industry. Of all
19%, almost three times higher than the creative indus-
observed categories in the creative industries, these achievevalues ofover 10%. The remaining markets such
tries as a whole. A similarly positive business development can be observed in the media (+10%) and in the
as music and film, books, art, and performing arts, have values under 10%. These markets, which tend to be cul-
small performing arts market (+15%). Performing arts and broadcasting, with 106 enterprises, are among the
turally oriented, are among the smaller sub-segments of the creative industries. In the business classification, architecture (28%), software and games (27%), and the design industry (20%) are among the leading sub-markets. Their growth of 5 to 10% is also a notable contribution to the market
smallest sub-markets, along with the advertising industry, with almost 400 enterprises, and the handicrafts
growth as a whole. Yetthe dynamics of the business development in other sub-markets is clearly better. The film industry
industry with 850. The leading industry according to turnover is clearly the software and games industry, which, with CHF 21.4 billion comprises one third of the creative industries' total revenues, and at the same time it is the fastest growing. Its growth rate is three times that of the total revenues of the creative industries, equivalent
M
'"
THIRTEEN SUB-SEGMENTS ACCORDING TO NUMBER OF BUSINESSES, TOTAL TURNOVERS, WORKPLACES AND EMPLOYMENT. AMOUNTS GIVEN IN ABSOLUTE NUMBERS, PERCENTAGES, ANO 4 -YEAR CHANGE IN lI.
Sub-market
1. MUSIC"
2. BOOKS 3. ART 4. FILM
5. BROADCASTING
Workplaces
Enrerprises
TOlal
- -- - ----:-=:proportion 4·YC.u
~~--:;:yw
number of toul change in ~ ~~-_.:.::...::..
lotal
change
- million - - - - in- %
in %
in CHF
numbe r
Employees"
~--:;:yw
rO!.l1
~~
change ioey.,
--------
- - - - - - -- 3-9 - - - - - -3 - - - - - - - - - - 10 . 2 ~
4
number
~
3
1._1
~
2
12.2 ~ IH
106
change
4
~
---------0-
0 _--,1..:...9<- ~
4 _---"3:.:..: .6:.... ~
7. DESIGN
~
_
~
4~~
-------- -------- ------------
tou l
~~~
- - - - - - - - - - - - - - - - - - - - - - - - - - - --....".--
6. PERFORMING ARTS"
3 _---!7..:..·S~
- 2 .1
2~
7 028
--------
o ~ ~
4 _--,::,,<0·7
- - - -4 -- I.S ~ __ ~
- 18.0 2 34. ~ 14·7 ~ - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - 6681
~
1_8 _ _-,--
II
6.1
II 482 _ _2_8_ ---"Sc..:.2:.. ~ _ _1_3
18·4
10383 _ _2_S
- 4.9
- 14·9
~ ___
- 14.6
2_0 _---'-~ 7·9
--------
9. ADVERTISING
--1.22.
....:2:.;...1:..
~
lS. SOFTWARE AND GAMES
---------~ 2_7 --2.:L
21 390
2~
7
-4.
- - - ---- - - - -
~
12. MEDIA
------- -- - - - - - -- -1 - - - - - - - - - - - -- -7.9-
13. AUDIO
~
I
IIO
2
-8.1
- - - - - -- - -- -
6 _....;;.;10:.:...0;;..~
24SI0
-1.1_
1_2
-6-----262 3
~
_ _1_8 _---=~ 3·7
0.8 S _ --,,,-,-
-------------2 2_3
3_S ~ ~
11. HANDICRAFTS
CREATIVE INDUSTRIES
- - - ~--:;:yw -------"..--
- - - - -_ - - - - - - - - - - - - - : ;6-.lli..
B. ARCHITECTURE
---
~
3 _--,0..:..·3~ ~
2
9
-11.3
S3 744 _ _2_7
---=.u..
----------:;23646
1_2
- 10·4
- - - - - - - = - - - - - - - - - - - -- - - - - -
3~ ~
4
-8·S
~
_~ ~ 4
4
-14·9
- - - - - - - - -------"..-- - - -- - - -6·7 201 127 ~ _ _-'-_
CHART 10_ OVERV IE W OF THE CO MPLEX O F BRA N CH ES I N THE C REAT IVE I N DUSTRI ES (2005)
NOles: " individual business branc hes are assigned 10di fferent s ub- marke ts, for this reason the final su m is sma ller tha n the su m ofthe individual sub-markets; "full- and part-time employees; exchange value I EURO = 1.5 CHF; for expla natio ns ofthe ind ividual busi ness branches sec CHART7. Sources: VAT Statistics, FTA; Swiss Business Census. SFSO;Creative Ind ustries Research Unil/zHdK; own calculation.
to a growth rate of almost 43%. The design and architecture markets also boast notable growth rates of 6%
few secure jobs with company benefits. Hence, the microstructure, or cluster, of the music industry will
and 18.4%,respectively, between 2001 and 2005. In turn, the film industry produces notable turnover, which has
commercial enterprises, one-person businesses, studio
increased to 13-4%. The art market follows with a simi-
and office partnerships, and networks in the creative
larly good rate of12.2%.
scene will dominate Swiss music industry in future.
become even more common. In addition to traditional
Most of the workplaces are distributed similarly to The book market is strongly based
the general business landscape, with architecture and
THE BOOK MARKET
design, and software and games generating shares of18
on microstructures. The literary sector, journalist agencies, and small-sized companies in the publishing and
and 25%, respectively. However, this category displays just how drastic the decline in workplaces is. Except for the film industry sub-market, every other sub-segment demonstrates a process of decline, some by more than 10%, and an overall 6.7% drop between 2001 and 2005. The film industry is again the only counter-cyclical subsegment here, increasing by 7.5%in the same period. Film and architecture are the only sub-segments with
retail book sector are the main structural features. The steady decrease in freelance enterprises and selfemployed workers, the reduction of the number of permanent employees and the dramatic decline in the amount of businesses and workplaces might signal a deep-rooted process of decline. The steady process of concentration in the retail book sector towards large
notable growths of6.3 and 3.7%, respectively, between
chain bookstores might trigger a development towards
2001 and 2005 in the employment market. There is a
a book trade that focuses more and more on the production of bestsellers. It remains to be seen whether
particularly steep decline in employment in the visual
and applied arts. The art market lost approximately 13% increasing internationalization of online book purchasofits jobs, and almost twice as rapidly, handicrafts lost ing will accelerate the rise in book turnover in Switzeralmost 22%. land as well. 3.2.6 DEVELOPMENTAL TRENDS IN THE SELECTED
THE ART MARKET
The art market consists of a large
The detailed presentation Of13 sub-mar-
number of visual artists who are part of a scene that
is summarized in the briefout-
revolves around visual art. The professional or economic
line below.
activities of the art sector have only ever been recorded
THE
A fundamental structural
very rudimentarily. The Swiss art market however is an international market. The rapidly rising international
change is taking place in the music industry. Owneroperated business or one-person enterprises are expected to increase in the market, and large or midsized enterprises will rely more and more on flexible
volume in revenue is partly generated by individual enterprises. The accelerating turnover in the art market is also partly due to information search engines on the Internet.
SUB-MARKETS
kets
[SEE CHAPTER 3.3]
MUSIC
INDUSTRY
personnel. It is predicted that there will soon be very
10
-e
THE FILM INDUSTRY
During the survey period the film
industry experienced a positive development compared
forming artists are dependent on the market structure on many levels, as well as on promoters or organizer
with the usual trend in other sub-markets ofthe creative
(theatre, radio, film) to offer their services to be shown
industries. As in other European countries, public and
and/or played and critiqued. Traditional, secure work-
private subsidies in Switzerland have greatly contrib-
ing conditions (through secure jobs) are disappearing.
uted to supporting the film industry. Technological
The performing arts market is a unique sub-sector of the culture and creative industry, which functions in a
developments in the film industry will affect individual production steps after digital methods in film produc-
"capillary" relationship ofexchange between the State,
tion and movie houses become more common. This
intermediate, and commercial creative trade. State and
could trigger a rise in the number ofsmall film production houses that increasingly shift to video production.
commercially financed services can complement one another and should therefore not be viewed only as
The digital and technical amalgamation ofDVD, video,
opposite pairs.
film, TV, and computer might become a developmental and creative basis for many people working in film.
THE DESIGN INDUSTRY
The design industry will most
likely develop into a leading branch within the creative Both public and private
industries, because it has links to almost every other
broadcasting enterprises are essential to the creative industries for many reasons. They are the main promot-
creative market. These include sound design in the music industry, graphic design in the publishing indus-
ers of the creative industries' performance sector, they operate on the creative market with their own produc-
try, visual design in the art market, media design in the film industry, stage design in the performing arts mar-
tion companies, and they appear directly as an impor-
ket, and web and video design in the games industry.
tant investor in the film and TV production sector. In
New technological developments reduce the problems for designers much more than for other cultural
THE BROADCASTING INDUSTRY
addition to funding models by the department of culture's success-dependant film subsidy program, "Sue-
branches, because they define themselves less through
ces Cinema," there is the "Pacte de l'audiovisuel"
the design ofproducts and more through the design of
between the film industry and the swiss radio and television broadcasting corporation (SRG SSRidee suisse). These are examples of a close relationship of exchange between the public and the private sectors. Broadcasting companies could hence become the hub ofthe entire Swiss creative industries.
ideas and concepts. The design industry is presumably the creative branch that can best develop non-technological innovations. THE ARCHITECTURE MARKET
The Swiss architectural
industry has a unique position in Europe. This particularly positive development is even more unique consid-
Performing artists are
ering that the architecture market is also one of the
one of the most complex groups. They are becoming
smallest. 95% ofall the workplaces in this sector are in
increasingly self-employed, yet remain dependent. Per-
micro-enterprises with fewer than ten employees. The
THE PERFORMING ARTS MARKET
architecture market in Switzerland proves that even
counted individually. Documenting workplaces is
small enterprises can demonstrate stable value-added
important because it is the best way to record employ-
effects.
ment potential.
3.3 A DETAILED ANALYSIS OF THE 13 SUB-MARKETS
EMPLOYMENT: The word employment comprises both
Below is an empirical analysis of each individual sub-
self-employed and permanently employed individuals. It
market [3.3.2 to 3.3.14]. Each analysis is preceded by a
can be divided into part-time or full-time or full-time
short summary that provides the reader with an over-
equivalents, i.e. the conversion of full- and part-time
view of the important empirical findings and some of
into full-time.
the theories derived from them. MICRO- AND SMALL ENTERPRISES: The terms micro3.3.1 CORE TERMS OF THE SUB-MARKET ANALYSIS
enterprises and small enterprises playa vital role in the
Because the professional terminology used in economic
creative industries. Yetdespite the fact that there is no
or employment statistics is not always self-explanatory,
official or authorized terminology for this in Switzer-
the following provides some core definitions and basic
land, the terms are still used professionally. The Swiss
references.
State Secretariat for Economic Affairs (SECO) divides enterprises into the following categories in magnitude,
COMPANIES: A company is a highly organized unit con-
according to the number ofemployees.
sisting ofnumerous branches, local offices, or divisions,
_Micro-enterprises: 0-9 _Small enterprises: 10-49 _Mid-sized enterprises: 50-249 _Large enterprises: 250 and more The small and mid-sized company structure is often abbreviated to SME. In the following analysis, the terms micro- or small-sized enterprises will be used in two ways. When discussing workplaces and employment, the term "micro-enterprise" will be used as described above. When discussing enterprises and revenues, the term small-sized enterprise will be used. This is also used for taxable enterprises that can file simple flat-rate tax or bottom-line tax forms.
which can be operated from several locations. From the tax authorities' point of view, it is an independent unit with business activities that generate taxable and taxfree turnover. Self-employed or freelance professionals also belong to this category. According to formal law, the categories of companies include one-person businesses, limited liability corporations, stock corporations, and so on. Registering the business unit is important because this records its economical potential. WORKPLACES: Workplaces are site-specific units. A workplace is part ofa lawfully recognized, independent company or identical to it. In the creative industries, these include the agencies, ateliers, or studios of small enterprises, as well as the factories and firms of midsized or large enterprises. A company's workplaces are
CLASSIFICATION:
The classification of business activi-
DATA FROM FEDERATIONS AND ASSOCIATIONS:
The
ties, NACE, stands for "Nomenclature statistique des Act-
quality of sources borrowed from these sources is gen-
ivites economiques dans la Comrnunaute Buropeenne"
erally very high. Ifstandard data on the number ofmem-
(General Industrial Classification ofEconomic Activities
bers or other market data are available, they are entered
within the European Communities) and is the classifica-
in sub-market portraits. Yetthe data gathered in surveys
tion system of the statistical systematic of economic
taken for this publication different at various associa-
branches in the European Community. Switzerland has a
tions could not be fully included in the evaluations,
comparable system, the General Classification of Eco-
because the return in all ofthe interviews was not satis-
nomic Activities, NOGA (which stands for Nomenclature
fying. Improving this data situation will be an impor-
ofGeneral Activities). This system classifies and catego-
tant task for future research on the creative industries.
rizes every business activity in the national economy. It is
For the above reasons, it is important to remember
used in the entire economic system (economic chambers,
when reading the following portraits that statistical
business data banks, etc.) - not only in business statis-
findings are less than mathematically precise conclu-
tics.
sions. They should be viewed as preliminary illustrations and points ofreflection for further individual con-
DATA SOURCES:
The Mehrwertsteuerstatistik (VAT Sta-
tistics) of the Swiss Federal Tax Administration (FTA)
sideration. Due to the difficult state of statistics for the crea-
and the Bidgenossische Betriebsziihlung (Swiss Busi-
tive industries complex of branches, the sub-markets
ness Census) of the Swiss Federal Statistical Office
will be observed from three perspectives.
(SFSO) will be the main sources of data for the statisti-
_ From the internal turnover perspective (Swiss Federal Tax
cal analysis. As indicated above, the creative industries
Administration, VAT statistics)
in their entirety cannot be documented using official great challenge to statistical analyses, and can result in
_ From the official statistics perspective (Swiss Federal StatisticalOffice (SFSO), Swiss Business Census) _ From the perspective of information from various associa-
occasional shifts in time comparisons in official statis-
tions and other sources of market information.
statistics. Their complex network structure presents a
tics that cannot be accounted for in real market developments. These shifts can occur when official statisticians
3.3.2 THE MUSIC INDUSTRY
introduce new definitions or classifications, which
OVERALL ASSESSMENT OF THE SWISS MUSIC INDUS-
causes certain enterprises and workplaces to be reclas-
TRY The
sified and "statistically transferred" to a different eco-
characterized by its complex structure ofvery different
nomic branch. Hence, large media companies can be
business activities. Nonetheless, there are some com-
transferred from the "publishing" branch
music industry, also called the music market, is
the
mon basic features. First, there is a large music sector,
"recording" branch, so that the data suddenly show a
consisting mainly of self-employed and freelance musi-
major shift that, due to the official statistics' strict data
cians, composers, performing artists, small businesses,
protection laws, cannot always be plausibly justified.
and so on. This creative scene is also combined with
to
semi-professional structures that extend to the area of
THE MUSIC INDUSTRY FROM THE PERSPECTIVE OF THE
active amateur musicmaking, rock, pop, and jazz. Sec-
SWISS FEDERAL TAX ADMINISTRATION
ond, the music industry also has a traditional, estab-
companies and self-employed workers in the music
lished business structure that ranges from musical
industry (excluding the audio industry) amounted to a
instrument production to music publishers and music
total of! 684 in 2005. This figure consists of "classical"
stores. Third, the term "music industry" primarily refers
economic branches, including
to the audiovisual equipment market, whose largest
musical instrument manufacturers, almost
enterprises possess a good deal of added value. In addi-
nesses for audiovisual equipment market, as well as com-
tion to production, they also possess the distribution
bined economic branches and other services (concert
rights to developed sales and distribution systems,
agents, event organizers, sound studios, etc.) that com-
291
The number of
music stores, 200
221
busi-
which secures them a central position on the music
prise approximately
industry market. Besides these three market basic fea-
groups. The largest segment is by far the discotheques,
200
businesses in the largest sub-
tures, the public music and theater sector complements
dance and night clubs sector, which makes up one fourth
the music industry.
ofall businesses in the music industry, with a total of 450
There is a strong shift in the structure of employment taking place. The moderate development of new,
businesses. Compared to
2004,
the number of businesses in
independent companies and freelancers is faced with a
the music industry increased by only 0.8%. In the four-
dramatic decline in local branches and permanent posi-
year comparison with
tions. The number of owner-operated businesses or
growth rate of 4%. The music industry is therefore
one-person enterprises will presumably increase in the
showing a gradual upward trend, which is influenced by
200I,
however, there is a total
market, and will most likely (be able to) provide only
different positive and negative changes in the individual
project-related, temporary, or part-time positions. After
economic branches. Small sound studios and music
the decrease in workplaces and the associated reduction
publishers are pushing their way onto the market with a
of employment possibilities, even small and mid-sized
growth rate of 23% in the four-year comparison, fol-
firms will rely more and more on mobile, flexible, and
lowed by theaters and music venues with a growth rate
temporary personnel. New secure jobs that include
of 22%. This does not reflect large theater or opera com-
social benefits will presumably be rare even in major
panies; it is the growth rate of small and independent
companies and media corporations in the future. This
theaters and music ensembles, which mostly serve the
will result in an increase in micro-enterprises in the music industry. One-person enterprises, shared ateliers
concert and festival segment in association with concert agencies and event managers. In contrast, the situation
and bureaus, and creative scene networks will shape
in music sales and the audiovisual equipment market
Switzerland's future music industry in addition to tradi-
has worsened. This sector has lost between 5 and 9% of
tional businesses.
its trade, and this negative trend has remained constant for years.
KEY DATA ON THE MUSIC INDUSTRY ENTERPRISES 219191- 219195 (VAT STATISTICS)
Numb. ,
1001
1001
1620 67 26
in%
Number
in%
1003
2004
1005
1005/01
1004/03
1005104
16 4 0 62
1 64 6 61
16 7 1
1 684 70
4. 0 4·5
1·5 13.1
0.8
69
29
29
24
25
- 3.8
- 17.2
4. 2
76 27 217 222
89 24 21 211
92 23 221 198 2 I 106
22·7 - 11 ·5 .8 - 8.8
17.1 - 11.1
- 4·9 21.8
-0·9 - 5.0 0.0 10.8
3·4 - 4.2 2.8 - 6.2 - 1.4
10·3 8.6
4·7 1.4
295 103
87
1·4
2·9
192
192
201
4 24
434
44 0
20 3 455
CIIF million
CIIF million
CIIFm iliion
CIIF million
Cl lF million
in %
in %
in %
1001
2001
1003
1004
1005
1005/01
1004/03
1005/0 4
1959 99
19 60 101
18 71 106
19 07 116
2 060 119
5. 2 20·9
2.0 10.0
8.0 2.6
19
20
20
13
14
- 22.6
- 33·3
7·5
232 86
195 80 114
148 71 108 43 1 3 14 24 2
1.0 - 22.1 -3.8 - 20.8
0.2 - 6·9 - 0.6
477 299 186
148 76 10 9 45 6 280 228
120·7 - 5·5 0.6 - 17.8
113 373
90 35 8
115 349
18 4 4 19
4-year change
Total turnover
113 447 3 10 175 101 379
I II 373
1.0 3·4
r-yearchange
- 3·5 64·7
- 5·5 12.1 6.0
.8 -1.6
27·5 - 2·4
-4·7 19.1 -3·5 6.6
Total turnover
CIIF million 2005
MUSI C I NDUSTRY Orchestras, choirs, (including self-employed musicians) Schools of the arts (including self-em ployed mu ic teachers) Publishers ofsound recording media (CD /DVDs/CD-ROMs) Reproduction ofCDs/DVDs/CD-ROMs Manufacturing mu ical instruments CDs/DVDs/CD-ROMs retail trade Mu ical in rruments retail trade Th eaters, op era hou ses, etc. ' ) Other auxiliary ervices for cultu re and entertainment (including sound studios) ' J Discotheques ere. "
r-year change in%
Nu mber
7 26 213 217 3 06
MUSIC INDUSTRY Orchestras, choirs, (including self-employed musicians) Schools of the a rts (including self-employed mu sic teach ers) Publi hers ofsound recording media (CDs/DVDs/CD-ROMs) Reproduction ofCDs/DVDs/CD-ROMs Manufacturing musical instruments CDs/DVDs/CD-ROMs retail trade Musical instruments retail tra de Th eaters, opera houses, etc. ' ) Other auxi liary ervices for culture an d en tertainment (including sound stu dios) :" Discotheques etc. ' )
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 219195 (VAT STATISTICS)
Numbr,
Number
MUSIC INDUSTRY Orche tras, choirs, (including elf-employed musicians) Scho ols of the arts (includ ing self-employed m usic teachers) Publishers ofsound recording media (CDs/DVDs/CD-ROMs) Reproduction ofCDs/DVDs/CD-ROMs Manufacturing musical instruments CDs/DVDs/CD-ROMs retail trade Musical instruments retail trade Thea ters, opera hou ses, erc. ? Other auxi liary services for culture a nd entertainment (inclu ding sound stu dios) ' ) Discotheques erc. v
TOTAL TURNOVER 219191 - 219195 ( VAT STATISTICS)
.J-y.a, change
Co mpanies.
nfwhich Turnover of small
Turnover 31
Turnover at normal
reduced VAT rat.
enterprises
CIIF million Share 1005 in %
CIIFmill ion Share 1005 in %
106 _ _ 5 8 7
2060 II
196 13
10 10
14
2
14
2 67 109
4
0
0
21 6 14 4 5 13 _ _
10 0 0 20 16
3 0 0 6
29
10
III
12
II
18
16
373
64
---2Z.
5
354 299 288
23 23
Tax-exempt
Expon
VTrat. CIIFmillion Share 1005 in %
CIIF million Share 2 005
in %
1176 24
-iZ. 20
3 19 2
15 2
3
17
0
tu rnover
turnover
228 70 4 2 __ 8 ---li 6 2
9 28 5
3 77
CIIF million Share 1005 in %
240
12
73
61
8
58
6 0 0
2 2 0 0
4 22
8
4 127
44
16 0
15 0
6 15
4
WORKPLACES AND EMPLOYMENT 261611 AND 261615 (SWISS BUSINESS CENSUS) MUS I C I NDUSTRY Orchestras, cho irs, (includ ing self-employed mu sician s) School s o f the arts (including sel f-em ployed mu sic teache rs) Publis he rs ofso und reco rd ing med ia (CDs/DVDs/CD· ROMs) Reproduction ofCDs/D VDs/CD-ROMs Manufacturi ng m usical in strum ents CDs/DVDs/CD- ROMs reta il trade Musica l ins trume nts retail trad e Theaters, opera houses, etc. o j Oth er au xiliary se rvices for culture a nd en tertai nme nt (incl uding sound stud ios ) 01 Disco theques etc. •,
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 261615 (SWISS BUSINESS CENSUS) MUSIC INDUSTRY Orchest ras, choirs, (includ ing self-employed musicians) Schools of the arts (inclu ding self-e mployed music teac hers) Publishers of sou nd recording media (CDs/DVDs/CD-ROMs) Reproductio n ofC Ds/ DVDs/CD-ROMs Manu facturin g musical instruments CDs/DVDs/CD·ROMs reta il trad e Mu sical ins tr ume nts retail trade Theaters, opera hou ses, etc. 01 Oth er au xiliary services for culture and ente rta inme nt (including sound studios) " Discoth equ es etc. oj
Workplace s
4-ycar change
Number 200 '
2 466 to
122
Persons employed bI
4·y. ar chan g.
Numb er
in %
Num ber
Numb. r
in %
200 )
2 0 0 5 101
200 1
2005
2005101
21° 5 1°4
- 11·3 1.0
15021 967
14°14 1063
- 6·7 9·9
98
- 19·7
1597
1796
12·4
21 7 379
- 28·4 - 18
796 4 271
666 3 64 2
- 16·3 - 14·7
120 37 337 446 384 15 2 30 462
Workpl aces <,
o f wh ich, workpl aces with ... em ployees "
\\'orkpl aces
ro and mor e Share in % of'a l! workplaces
28 24
12 2
8 12
52
18
II
19
107 30 270 368 375 139
72 57 73 58 58 38
21 23 19 35 29 22
3 5 7 8 19
5 20
215 379
74
20 37
4 32
2 20
' - 2
2 -5
20°5
Share in % o f'all wo rkpl. ccs
Share in % ofall workplaces
2066 103
52 62
80
Number
II
5 - 10 Share in % o f all
CHART 11 _ KEY DATA O N TH E MU SI C INDUSTRY No tcs: " indlv idu al bus ine ss branches assig ned to d ifferent su b-mar kets; bInot including companies in the non-market busines s sector: <, full-tim. equi valent , Sources: VAT Stat ist ics, ITA; Swiss Bus iness Cen sus , SFSO; Creative Industri es Research Unit / ZHd K; own calculat ion .
2 17 3
The music industries' total turnover amounted to
products. This is radically different from the book mar-
CHF 2.1 billion in 2005. Turnover in the music indus-
ket, which can sell books, magazines, etc., at a rate of
tries clearly experienced more growth than business
only 2.4% VAT.
development. With an 8% increase in turnover from
Discotheques are another economically significant
2004, and an overall increase of 5.2% from 2001, the
branch, with total turnover ofCHF 373 million (an 18%
rate of development is clearly positive. After years of
share ofthe music industry). As in the retail record trade
decline and stagnation up to 2004 in the "publishers of
sector, most of the turnover produced by these eco-
sound recording media" sector, the Federal Tax Admin-
nomic branches stems from domestic sales with a
istration reported a boom in turnover for this segment
standard tax rate of7.6% (CHF285 million from disco-
in 2005. The publishers of sound recording media
theques, CHF 229 million from music stores). It is
increased their turnover from CHF 148 million to
remarkable however, that such a significant proportion
CHF 327 million, or 121%, between 2004 and 2005
ofturnover in both economic branches is attributable to
alone. This astonishing development stems purely from
small enterprises
an almost tenfold increase in export turnover, from
economic branch ofmusic instrument production, pro-
CHF 27 million to CHF 228 million, between 2004 and
ceeds from small enterprises amount to over 20%. In six
2005. This exorbitant shift in turnover is presumably
of the ten music industry economic branches, small businesses represent percentages ofIO% or more ofthe
tistical purposes, rather than to actual market develop-
total turnover.
ment. The image presented by IFPI, the International
Another special feature of the music industry is
Federation of the Phonographic Industry, is quite the
the comparatively high percentage of tax-exempt reve-
opposite. It still shows a downward trend in market
nues, CHF 240 million, or 12%.As a rule, these tax-free
development (see the portrait ofthe federation below).
proceeds stem purely from enterprises and institutions
With a turnover of CHF 784 million, the audiovi-
that are mainly supported bypublic funding for the arts
sual equipment market (publishing, reproduction, and
and other cultural activities. In Switzerland, these
retail trade) is still the economic branch with the strong-
include orchestras, theaters and opera houses, play-
est revenue, making up 36% of the music industries'
houses, and music schools. The economic branches of
entire revenue. While most of the revenue produced by
"orchestra, choirs, etc.," "schools of the arts," and
individual segments in the audiovisual equipment mar-
"theaters and opera houses, playhouses, etc." point in
ket stems from export (CHF228 million, or 70% of CHF 327 million), revenue produced by the record retail
fact to high percentages, 44 to 61%, of exempt revenue. The revenue generated by these cultural institutions
trade stems mainly from domestic sales. Of the CHF 354
cannot be separated from taxable turnover, resulting in
million turnover produced in 2005 by CDjDVDjCD-ROM
a mix ofprivate, public, and non-profit music sectors.
domestic sales of CDs, and so on. The normal rate of 7.6%VAT is imposed on the turnover produced by these
N
In the related
due to the reclassification ofa media companies for sta-
sales, CHF 304 million, or 86%, was generated by the
to
[SEE CHAPTER 3.3.1].
THE MUSIC INDUSTRY FROM THE PERSPECTIVE OF
of up to ten employees, amounting to 12% of the total.
OFFICIAL STATISTICS The following section will add
The central music industry segment in particular, such
to the above-mentioned business changes based on the
as the audiovisual equipment market, musical instru-
Federal Tax Administration (VAT) statistics by focusing
ment production, and music retail demonstrate a defin-
on the music industry from the official statistics per-
itive micro-enterprise structure. Between 95 and 99% of
spective. As the data provided in the key data charts
workplaces belong to this category. Conversely, only I to
demonstrate, a total of2 I05 workplaces existed in 2005,
5% of these employ more than ten persons per work-
with a labor force of14 0I4 (full- and part-time).
place.
Workplaces in almost every economic branch of the music industry have declined massively, shrinking
PORTRAIT: THE MUSIC INDUSTRY FROM THE PER-
by 14.6% between 200I and 2005. Only the economic branches consisting ofpublicly funded cultural institu-
SPECTIVE OF THE IFPI (INTERNATIONAL FEDERATION OF THE PHONOGRAPHIC INDUSTRY)
tions, such as "orchestras, choirs, etc." or "theater and
According to their owndata, theSwiss IFPI has more than 31
opera houses, playhouses, etc." can demonstrate a slight
members in theCD/DVD/CD-ROM manufacturing sector. These include the Jour major companies: EMI Music Schweiz AG, Sony BMG Music Entertainment Schweiz GmbH, Universal Music GmbH, and Warner Music Schweiz AG. Thefederation estimates that there may be over 30 000 persons in Switzer-
growth from 1.0 to 2.6%. The same negative development can be observed in employment potential. At -6.7% between 200I and 2005, almost 400 workplaces were lost in the music industry. This decline however, is observed mostly in the pure music industry branches. Negative rates ofIO% or more in the audiovisual equip-
land - artists, authors, composers, employees of publishing houses, agencies, sound studios, record labels, CD pressing,
duction demonstrate that there has been a drastic
event managers and dealers - employed directly or indirectly in production, sales, and distribution chains in the audiovi-
decline in jobs in the four-year comparison. This nega-
sual equipment market
ment market, music retail, and musical instrument pro-
tive trend contrasts the development in combined, pub-
"The previous dramatic decline in music revenues on theSwiss increase their personnel from IO to 12%. market practically came to a halt last year. The turnover In addition to the decline in individual businesses reported by the Swiss International Federation oJ the Phonoand jobs, it is becoming clearer that the business struc- graphic Industry (IFPJ) oJtheirmembers amounted toCHF 224 ture ofthe music industry as a whole consists mainly of million in 2005, "only" 3% less than the previous year. Legal micro- and small enterprises. Based on 2I05 workplaces downloads were added to this, whose percentage of turnover of in the music industry, 2 066 were analyzed in terms of approximately CHF 3 million is still modest. Cell phone music their structure. 52% of these workplaces are agencies, downloads have also been added (realtones, mastertones) as businesses, and small enterprises employing one or two well as high-quality audio DVDs. In total, IFPI members sold persons. They are typical owner-operator enterprises. A last year 13.6million CDs. The declineJrom the previous year further 28% employ up to fivepersons, with workplaces (I6-4 million) can be explained by the Jact that, as is true licly funded economic branches, which were able to
M
to
internationally, multiple CDs are now calculated as single units.1ftaken into consideration that IFPI members represent approximately 90% of the Swiss music market, and assuming there is a retail trade margin of approximately 25% (+7.6% added value), theestimated market volumefor 2005 is CHF 335 million. Another 15-20% can be added for illegal downloads and parallel imports."
3.3.3 THE BOOK MARKET OVERALL ASSESSMENT OF THE SWISS BOOK MARKET
Source: Swiss Music News, March 18~ 2006.
(book trade, direct marketing, book clubs, department
The book market is a cluster of many small structural units, the predominant ones being the literary sector, journalist bureaus, and small enterprises. On the other hand, the close-knit market, the concentration ofmedia companies, and the different channels of distribution stores, the Internet) are the key features of the book market. Its most obvious members include authors, writers, and journalists. They are the original "word producers." Although there would be hardly be any rep-
turnovers in Olio. USD
country
USD per capita
resentatives of the book or press industries without these word producers, there are still a number ofbranch
Sweden
295. 0
33
Austria
282.1
35
Switzerland
25 6.3
34
Norway
255·7
56
Denmark
176.9
33
Finland World
140.7 3°2°4
27
studies that concentrate on the purely manual and industrial production ofbooks. The group ofword producers is considered as suppliers who do not really have much to do with the actual "business." Publishers, from the smallest to the most globally active book and media companies, form the second group, which produces books and secures copyrights. The third group consists
THE POSITION OF THE SWISS AUDIOVISUAL EQUIPMENT MARKET IN AN INTERNATfONAL COMPARISON (2003).
Source:
IFPI 2004.
ofwholesalers and retailers ofbooks. The book market is distinct from other sub-markets in two ways. First, books can be bought at a reduced VAT rate (in Switzerland, 2.4%). Second, for decades the book price fixing agreement has created a relatively stable sales market that could possibly be threatened by discount products from non-branch retail chains. The book market has long been considered a "classical" cultural market par excellence that represents the double function of cultural goods, i.e. their economic and cultural significance. The steady decline in independent enterprises and self-employed workers, the decline in the number of employees dependent on workplaces, and the dramatic
-e to
decline in branch firms and jobs could signalize a farreaching change of structure. The process of concentration in the book trade
million, and the largest bookstore chain Thalia with CHF 103 million (all data: Buchreport Magazin, March, 2006).
The book market's overall sales trend may not have
sector as well as the trend towards expanding chain bookstores promotes the development of a "monocul-
been very positive in the four-year period from 2001 to
ture" that will increasingly encourage and position the
2005, yet, except for the book trade, 2005 shows an
production ofbestsellers.
upward trend. However, a rise in book turnover does not
The book market has also been greatly influenced by the growing use of the Internet for book sales. According to the sales channels of the German book
actually mean a rise in returns. And all professionals in the book market are complaining about costs that are
market, the different market percentages of the book
rising quicker than turnover. Observing the development of different turnover
trade turnover in 2005 were made up as follows: at 55%,
types shows that, in the book and media publishing
book dealers generate more than half of all book turn-
segment, book turnovers with a reduced tax rate
over, while publishing firms generate 17% with direct sales. The Internet and mail-order book trade generates
declined 6% between 2001 and 2005, while turnovers with a standard tax rate - i.e. they comprise non-book
an n% share. The remaining sales channels comprise
products as well - rose 14% during the same period.
less than 10%: department stores (4.3%), book clubs (3.2%), and other points of sale (8.9%). Only the Internet, mail-order book trade, and direct sales by publish-
Hence, in 2005 in the publishing branch, CDs, DVDs, etc. generated more turnover than books! Book production is shrinking and media production expanding.
ing firms were able to expand their share ofthe market.
Technological adva nces affect many traditional
It remains to be seen whether the increasing interna-
sales and marketing channels. The book market is not
tionalization of book sales will affect the Swiss book market's Internet sales turnover positively over the next
spared this development, and will be affected not only by Internet trade, but also by the growing digital pro-
few years.
duction of content. The diversity of local-regional book
A few large book and media publishers and chain bookstores dominate the development of turnover in the Swiss book market. The largest Swiss publishing house, Diogenes-Verlag, with a staff of 62 and annual
distribution is under pressure, not only from the competition, but also from its own lack of technological progress, and because of a decrease in stable, regular customers.
revenue ofCHF 61.5 million, increased its annual turnover in 2006 by 2.6% from 2005. In the same period the second-largest publishing house, Orell Fiissli, with 37 employees, generated a sales volume of CHF 15.9 million, 0.9% lower than the year before (all data: Buchreport Magazin, April 2007). The largest bookstore in Switzerland is Orell Fiissli with a turnover of CHF 118
to to
ENTERPRISES 2SS1-2SS5 (VAT STATISTICS)
Co m pa nies
r-year change
4-)'ear chang e 2004
Number '005
in % '005101
in % '004103
108 2
1 07 1
1 082
-309
- 1.0
1.0
96 124 4 64 39 8
98 126 4 62 385
10 130 473 374
18.0 -8·5 -4. 1 - 7.0
2.1 1.6 -0·4 - 3·3
.1
CllI 'lllillion
20°3
CllI'million '004
CIIF million
2001
CII F llliliion '001
BOOK MARKET
1982
19 24
179 0
Other artistic activities an d performances (including writers, authors)" Freelance journalists Book publishers (including musie publis hers) Retail book trade
23 49 t l74 73 8
25 45 1120
21
Other artistic activities and performances (including writers. authors) ' ) Freelance journalists Book pub lishers (including music publishers) Retail book trad e
BREAKDOWN OF THE DIF.FERENT TURNOVER T YPES 2SS5 (VAT STATISTICS)
1 126
110 4
89 142 4 402
6 129 4 82
Num ber
BOOK MARKET
TOTAL TURNOVER 2 SS1-2 SS5 ( VAT STATISTI CS)
Numh er
2002
Number '003
Nu mb er '001
CIIFmiliion
40 1026 7 03
735
19 13
- 3·5
3. 1
23 42 10 59 7 22
31 44 1 149 68 9
36.8 - 9.1 -2.1 - 6.6
9. 6 3·7 3· 2.6
Turnover at Turnover reduced at normal VAT rare VT rate CIIF million Shar e CIIF million Share CIIF million Sha re _ _ _.:; , 00:;:.L 5 in % _ _--":.:0"' 0.... 5 ill % _ _--":.:0::::.L 0 5 in %
44 1149
small
Export
enterprises
turnover
153
8
84 2
15 15 0
48 34 3 14
0
94 Workplaces
3 80 4 61
Number
Number
4')'ear change ;11 %
2001
2005
2005/0 1
1459
- 10.2
Other artistic activities an d performances (including writers, authors) 'J Freelance journalists Book publishers (inclu ding mus ic publishe rs) Retail book trade
Other artistic activities an d perfo rmances (including writers, authors)" Freelance journa lists Book publisher (including mu ic publishers) Retail book trade
184 6
3·7
Turnover of
BOOK MARKET
BOOK MARKET
in % 100 410 3
of which
turnover
BOOK MARKET
WORKP LAC ES ACCORDING TO LEVELS OF EMPLOYMENT 2SS5 (SWISS BUSINESS CENSUS)
2005
in % 1005101
Total
million ' 005
WORKPLACES AND EMPLOYMENT 2SS 1 AND 2SS5 (SWISS BUSINESS CENSUS)
r-year change
4')'ear change
TOI;)1 turnover
cm
Other artistic activities and perfo rma nces (including writers, authors) 'J Freelance journalists Book publishers (including music publis hers) Retail book trade
397
44
57 6
3 67
15 26 4 23 11 2
Workpl.ces "
16
3 11
1-'
2
4')'ear change Number
2001
2005
il1% '005101
7 885
-2.1
4 23 57 1 17 3574
11.0 0·4 -2.6
-3-3
andmore
workplaces
5 - 10 Share ill % o f all workplaces
Share in % o f a ll workplaces
60
25
7
7
8 87 53 49
12
2 2 8 10
3
Share in % ofall work bees
145 1
449 595
' -5 Share in % o f all
9 28 34
23
18
ofwhich . workplaces with ... C'lIlpln)'c es .Jl
Number '005
CHF million Sha re :;,00:;:.L 5 in %
0
0
Number
- 11.0
turnover
CIIF million Share .:; ' 0",0,-,5 ill %
30
Persons employed '?
80 51
Tax-exe mpt
10
2 II
7
CHART 12_ KEY DATA ON BOOK M AR K ET .
Notes: . .) individual business branchesassigned ro differe nt sub..markers; bJnor including companies in the non..ma rke r business sector: equivalent , Sources: VAT Statistics. FT,\; Swiss Busi ness Census. SI'SO; Creative Industries Research Uni t I ZlI dK: ow n calc ula tion.
c)
full..rime
3
2 2 0
THE BOOK INDUSTRY FROM THE PERSPECTIVE OF THE
ists and book publishers seem to be regaining trust in
The number of
the book market. From 2004 to 2005 they grew by 2.4
enterprises and self-employed workers in the book mar-
and 3.2%, respectively, while the retail book trade expe-
ket (excluding the press industry) amounted to a total of
rienced a slump, losing approximately 3%.
SWISS FEDERAL TAX ADMINISTRATION
1082 in 2005, with the greatest proportion being book
The total turnover generated by the book market
publishers with 473 enterprises and book retailers with
in 2005 amounted to CHF 1.9 billion. CHF !.IS billion,
374 enterprises. The groups of self-employed journal-
or more than half, are attributable to the book publish-
ists, writers and authors are represented by totals of 130
ing segment. In the same period, the retail book trade
and I05 bureaus, respectively. These figures provided by
generated CHF 690 million in revenues, while word pro-
the Swiss Federal Tax Administration most likely repre-
ducers (writers and journalists) generated CHF 31 mil-
sent only a very small part of the "word producers"
lion and CHF 44 million, respectively.
group. Compared to the number ofwriters and authors
The sales trend in the book market is similar to
(5 600 freelancers), journalists (IS 200 freelancers) reg-
the development in the business landscape reported
istered in Germany with the tax and turnover office,
above. In the four-year comparison, all groups except
Switzerland has approximately
freelance "word
the writers and authors reported 2 to 9% negative rates.
2 IOO
producers." ProLitteris, the Swiss copyright society for
However, the economic trend was different in each seg-
literature and art, reports 6 300 copyright holders as
ment. The journalist group's turnover dropped from
members - however, this includes visual artists and
CHF 49 million in 2001 to CHF 40 million in 2003, yet
other copyright holders.
rose again to CHF 44 million in 2005. But on average,
Compared to 2004, the number of enterprises in
according to current 2005 data, journalists generated
the book market grew by 1%. Yetthe four-year compari-
less turnover per bureau than in 2001. Book publishers
son shows an actual loss of 4 to 8.5% in the book pub-
developed along similar lines. From 2001 to 2003 the
lishing, book retail trade, and journalism sectors. How-
revenues sank from CHF 1.17 billion to CHF 1.03 billion,
ever, in the same period there was a considerable rise of
then began to steadily rise to CHF !.IS billion in 2005.
18% in the writers group. The writer's group was not
The book publishing business, however, still did not
able to positively influence the overall development of
return to its nominal zoor level. Yet,because the number
the book market's enterprises and self-employed work-
of enterprises - after the negative market growth - are
ers in 200I-2005. Yet this group also comprises a large
not yet increasing with the same dynamism, book pub-
proportion of other cultural groups that cannot be dif-
lishers in 2005 were able to generate more shares of
ferentiated for statistical purposes.
turnover per publisher. In 2005, the turnover per enter-
The book market shrank by approximately 4%. By 2004, many book publishers, book dealers, and journal-
prise was CHF 2.43 million; in 2005 the comparable amount was CHF 2.41 million.
ists had disappeared from the market. It was not until
In contrast to this, the retail book trade's total
2005 before data began to indicate an increase in the
turnover experienced a fairly steady downward trend.
number ofnew enterprises for some segments. Journal-
Turnovers dropped from CHF 738 million in 2001 to
CHF 689 million in 2005, or -6.6%. There are similari-
(2%), tax-exempt turnovers (0.5%), and turnover gener-
ties to the book publishers however, who, at rates of-7%
ated by small enterprises (14%).
in the four-year comparison, suffered an even more
It is evident that the reported 14% share of small
drastic decline. The statistical mean average ofindivid-
enterprises in the book trade would be a clear represen-
ual book dealers remains fairly stable. In 2001the value
tation ofthe actual situation. Here, the missing statisti-
was CHF1.84 million per enterprise, in 2005 marginally
cal documentation on book dealers with less than
higher at CHF 1.843 million. The key data presented above still does not suffi-
CHF 75,000 annual revenue had an impact, while a large
ciently describe the book market's structure. For this
potential revenue at the reduced tax rate. Comparing
reason, an evaluation of different types of turnover in
this with a subsequent evaluation of the SFSO's Swiss
the book market should provide more detailed insight.
Business Census shows that almost one halfofall book
From the 2005 turnover of CHF 1.9 billion, CHF 842
dealers employ one to two persons, and 93% ofall book
million (44% of the total turnover) are attributable to
dealers employ fewer than ten persons and are thus
sales at reduced rate of 2.4%. Sales at the reduced VAT
classified as micro-enterprises.
rate were generated by books and media products. A
Based on value-added tax statistics, the "word pro-
further 30% share of the total turnover with CHF 576
ducer" group reported very high turnover values for the
million stems from sales at the standard Swiss VAT rate
small-enterprise category. 48% of the total turnover of
of7.6%. With this, one third of the book market's total
the group of writers and so on stem from turnovers
turnover can be attributable to "non-book" products and services. Aglance at a detailed structure ofturnover
from small enterprises. In the journalist group, 38% is reported in the respective category. The above-men-
shows that publishers in particular have generated these
tioned reference can also be applied here to represent
high turnovers with products and services other than
the situation for the book trade. According to the Swiss
books, i.e. mixtures of book and media publishers that
Business Census, 83 to 97% of all writers and journal-
usually generate more revenues with CDs and DVDs
ists work in one-person businesses.
than with books. At CHF 423 million, the book and media publisher's transaction value at the standard VAT rate is clearly higher than the CHF 380 million publishers' transaction value at the reduced VAT rate. Sales of books and magazines are still the core business of the retail book trade, although the percentage of non-book items is steadily growing. Approximately 67% (CHF 461 million) ofbook turnover in 2005 stems from sales at the reduced VAT rate. Sales volumes at the standard rate amounted to 16%(CHF II2 million), with the remaining turnover divided between export
co
"'
share of small book dealers are already included in the
THE BOOK MARKET FROM THE PERSPECTIVE OF OFFICIAL STATISTICS
As the key data chart shows, 1459
workplaces with an employment volume of 7 885 persons (full- and part-time) existed in 2005. The number ofworkplaces in all ofthe book market's individual economic branches is declining drastically - decreasing 10.2% between 2001 and 2005. This negative development in workplaces is accompanied by
enterprises. Afurther 25% employed two to five persons per workplace. The workplaces with fiveto ten employees amount to 7%, and another 7% employ more than ten persons. Number ofenterprises and their turnovers 2005
Number of enterprises CH DE
Turnover in CHF million CH DE
a decrease in the rate of employment, which, however, only dropped 2.1% in the same time frame. This less
Journalists
drastic negative rate of employment is largely demonstrated by the two largest labor markets: the book pub-
Change from 2001 in %
lishers and the book trade. Whereas the publishing seg-
Book publishers
ment lost 9.4% of its jobs and the book trade segment 6%, the rates of employment decreased by only 2.6 and
Change from 2001 in %
3.3%, respectively. The "word producer" group (writers and journalists) lost II and 20% ofits workplaces (bureaus), respectively, between 2001 and 2005. In contrast, official statistics display an
II%
growth in employment in the
writer group and a modest 0.4% growth in the journalist group. This unusual deviation in trend can be explained for one thing by the above-mentioned, mixed writer group category that includes other cultural
Book trade Change from 2001 in %
.
6 IIS
44
-9
16
-9
9
473
208 9
1 149
14 43 1
-4
2
- 2
- 16
374
44 20
68 9
60 38
-7
-4
-7
8
'3 0
1166
CHART 13_ THE BOOK MARKET IN SWITZERLAND (CH) AND GERMANY (DE).
NOles: taxable enterprises with annual turnover of CHF 75 000 or more. German statistics harmonized with Swiss statistics. EUR I = CHF 1.5. Sources: VAT Statistics, FTAj German sales tax statistics, Destatis, Creative Industries Research Unitrztrdx, own calculation.
groups. For another, it seems that the larger journalist bureaus have actually concentrated jobs on fewer workplaces. The business structure of the entire book market is almost exclusively dominated by micro- and small enterprises. Based on the 1459 workplaces in the book market, I 451 were analyzed regarding their structure. 60% of these workplaces are bureaus, stores, businesses, or small publishing firms that employ one to two persons. They are independently run writer and journalist bureaus and classical owner-operated micro-
'" "'
The trend in Switzerland is less optimistic than in Ger-
PORTRAIT: BOOK PRICE FIXING IN SWITZERLAND -
many. Whereas in Switzerland the number of self-
INCOMPATIBLE POSITIONS
employed journalists between 2001 and 2005 dropped
"The Swiss Federal Council has rejected an appeal by theSchweizerische Buchhiindler- und Verlegerverband (the Swiss Association oJBook Traders and Publishers, SBVV)Jar a book price fixing agreement. The appellants were not able to substantiate
9%, there was a 16% rise in German journalists on the
market. The development of turnover for the journalist group also differs between the two countries. Adecrease
scape suffered drastic losses. The turnover volume
their claim that price fixing is needed to bring the service addressed in the petition to authors, publishers, retail trade, and theconsumer. [...] As theauditoJefficiency bythe monopolies commission has shown, causality could not be established between book price fixing and book cover diversity, product range, and book dealer numbers. Consequently, it cannot be established that book pricefixing is essential to cultural-political services."
dropped approximately 19% between 2001 and 2005.
Source: Federal Department of Economic Affairs media release. May 2,
of 9% in four years in Switzerland is contrasted by a 9% increase in Germany. The book publishing landscape in Switzerland lost 4% of its publishing firms between 2001 and 2005, but
in Germany, there was a small 2% increase in new (micro-)publishers. However, turnover volumes in both countries decreased. Here, the German publishing land-
This was partly due to drastic losses in large book and
20 °7_
media publishing firms, which suffered low periods after the 2000/2001 expansion. Switzerland, however,
"The Schweizerischer Buchhiindler- und Verlegerverband
suffered only a 2% loss in turnover.
(SBVV) deeply regrets the Swiss Federal Council's decision to
The book trade sector developed negativelyin both countries. Except for turnover volumes generated by the German book trade, which increased 8% in the fouryear period, other key data display a negative trend. The Swiss book trade dropped approximately 7%, and the German book trade 4%. This downward trend in Switzerland is accompanied by a turnover loss of7%.
reject the practice oJbook pricefixing. Most German-speaking Swiss cannot understand whytheSwiss Federal Council reJuses to acknowledge the significance oJtheSwiss book market. The Swiss Federal Council now risks a large increase in most book prices. It will be responsible Jor irreversible consequences that theSwiss book market will sustain. Furthermore, it has missed yet another opportunity to commit to a long-term policy on books and literature. The SBVV remains convinced oJthe positive effects oJ price fixing on both the cultural (diversity oJ products) and the economic level (low average prices oJproducts)." Source: SEVY media release. May 2,2007.
'"
3.3.4 THE ART MARKET
THE ART MARKET FROM THE PERSPECTIVE OF THE
OVERALL ASSESSMENT OF THE SWISS ART MARKET
SWISS FEDERAL TAX ADMINISTRATION
The art market consists largely of a great number of
ofenterprises and self-employed persons in the art mar-
visual artists who are difficult to document empirically.
ket (excluding handicrafts) totaled I 129 in 2005. The
They are part ofan art scene that revolves around visual
largest sub-groups were the art dealer group (galleries
The number
art. The federal tax authorities can report an economi-
and art dealers) with 422 enterprises, antique dealers
cally relevant base of approximately 250 taxable visual
with approximately 300 enterprises, and the group of
artists, the official statistics report approx. 770 mainly
self-employed visual artists with 249 studios. Art restor-
owner-operated studios, and visarte (Visual Arts Asso-
ers with 105 enterprises and museums with 58 private
ciation Switzerland), reports a total of 2 500 active art-
enterprises extend the core art market.
ists as its members. The Swiss art trade is an internationally oriented
Compared with 2004, the number of art market enterprises increased 1.3%; during the entire 2001 to
market. The dramatically rising international sales vol-
2005 period however, the art market only increased
ume is generated partly by individual enterprises. The
1.1%. Yet there are different developments concealed
accelerating turnover in the art market is also partly due
behind this factual stagnation. While in the surveyed
to information search engines on the Internet. Accord-
period the number ofvisual artists remained fairly sta-
ing to written information provided by the headquarters
ble at 244 to 251 artist studios, the number of galleries
of the Art Galleries Association Switzerland (AGS) in
grew 4.2% from 405 in 2004 to 422 in 2005. Even the
January 2007, the boom in contemporary art that began
number art restorers' workshops suddenly grew from
in 2004 will have increased dramatically in 2005. The
98 to I05 units or 7.1%. The number ofmuseums, includ-
AGS predicts that this development will continue in
ing private enterprises, developed differently and
2006. It also emphasizes the theory that the art market
decreased over the last few years to II units, or 13.4%,
has historically corresponded to financial markets,
between 2004 and 2005. The number ofantique dealers
implying that the positive trend could well continue.
steadily declined between 20m and 2005 from 318 to 295 enterprises (-7.2%).
The art market generated a total turnover of CHF 1.5 billion in 2005, which is a very positive trend compared with other enterprises. With almost 17% growth in turnover compared with 2004, and with 12.2% growth compared with 20m, the art market is
one ofthe most successful markets in the creative industries. The striking 36% increase in turnover in the art trade over the four-year period, and the increase of 26.5% from 20m to 2005 overall, had a positive effect
on the state of the Swiss art market as a whole. At
----ENTERPRISES 2881-2885 (VAT STATISTICS) I
Numbcr
Numbcr
Number
inCi.
t-yea r cha nge - - in %
2002
2003
2004
2005
2005 /0'
2001JOj
245
1114 243
112 9 24
1.1 2.0
-0·4 -0.8
1·3 2.
96 4°1 69 3°7
98 4° 67 3°1
1°5 4 22 58 295
18.0 .2 1.8 - 7.2
2.1 1.0 - 2·9 -2.0
7. 1 4. 2 - 13·4 -2.0
1132 2 I
I
118
4·y~r
Total turnover
TOTAL TURNOVER 2 8 81-2 8 85 (VA T STATISTICS )
change
CHF m illion CIlF m illion CllF mill ion CIlF milli on CIlF milli on
ART MARKET elf-employed visual artists Other artistic activitie s and performances (including restorers) ? Art dealers (retail trade with objects of contemporary art) Museums (including commercial elements) Antiques retail industry
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2885 (VA T STATISTICS)
117 244
4 · y~r change
Numbcr
Total turnover
r-yea r cha nge in%
inCJo
2002
2 003
2004
2005
2005 10 1
200;/0 3
2005 104
'3 18 48
1439 47
1 249 46
1 266
1479 4
12.2
1·4 6.
16·9 -1.6
23 737 25 2 258
25 68 7 443 239
21 606
31 100O
36.8 .6
15° 25°
- 4° ·4
9·6 3°·5 - 4 8. 5 -2·7
36.2 26. - 15.1 10·3
49 23 79° (77 226
343 23 2
0·4
-3-3
ofwhich Turnover at Turnover - Expon - reduced ar no rm al turnover enterprises VAT rate VT rate CIlF CHF mi llion Share million ha re CHF m illion Share CIlF m illion Share in % _ __ : 2 .;00 :=L5 in % 2005 ~ ~ in % 2005
hare in %
---------------=116 34 645 44 _
8
8 3
o
o
31
15 34 15 33
48 3 10 13
o
1000
3 16 13
o -",-60_ 1 II 42 2 5 _ _-,-,-- --E- _ _8_0 -----.E
33
2 _ _4,-,,9_6 19
Numbcr
Number
2 001
2005
workptaces <, Num bcr 2 005
182 5 68 161 4 89 24 383
----0
4-r car changc
Num bcr
Num bcr
in%
2001
2005
2005/ 0 1
2 005 /01
-18.0 -2 1.8 -11.0
4600 1
381 12 51 615 1018
-
·4 4·4 -24·3
47 383
18 _ 2 54 36 42 ~
Person ern ploycd . ,
in%
185° 768 162 49 0 45 506
39 - - 3 -6
o _ _~__-"",,
4-~rch.ngc
workplac
Tax-exem pt tu rnover CIlF m illion ...:2:.;00=5
122 26
1479 49
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2885 (SWISS BUSINESS CENSUS)
04
2001
in%
sma ll
2 005
ART MARKET elf-emp loyed visual artists Other artistic activities and performances (including restorers) :" Art dea lers (retail trade with objec ts ofcon temporary art) Museums (including commercial elements) Antiques reta il industry
2005 /
Tumm'C'fof
CIl F mill ion
WORKPLACES AND EMPLOYMENT 2881 UNO 2885 (SWISS BUSINESS CENSUS)
~
- 12·9 4 00 7 1010 -24·3 11.0 4 23 - 10.6 1118 10.2 678 77 8 _ _-_2~
of which . workplaccs with ... cmplayers "
'- 2
2 -5
hare in % o fa ll wo rkplaces
Share in % of. 11 workpl. cc
82 2 83 73 39 78
14 8 12 21 3° 20
CHART 14_ KEY DATA ON THE ART MARKET ENTERI'RISES.
Not es : " individual bu Iness branche a igncd to different ub-markets r " not including enrerprii es in the non-market bu in es secror. " full -time equivalent, ources: VAT Statistics. ITA: wi ss Busine s Census, SFSO; Creative Indusrries Re earch Unit' ZlldK; own calculation,
ro and more Share in %of.1I workplaces
2 0 2
3
4 15
r6
CHF I billion, it covers two thirds ofthe market branch.
THE ART MARKET FROM THE PERSPECTIVE OF OFFI-
The lion's share of turnover for art dealers is attribut-
CIAL STATISTICS Byand large, official statistics can
able to the growing percentage of exports of art works,
provide structural data for visarte's reported number of
which generated CHF 560 million in 2005.
artist studios and workplaces. According to this, at least
Art restorers also generated a similarly impressive
768 visual art studios existed throughout Switzerland in
36% growth in turnover between 2004 and 2005,
2005, with an employment potential ofI oro. The devel-
whereas revenues generated by the related group ofvi-
opment ofartists' studios however, shows a steep down-
sual artists did not increase. A dramatic decline can be
ward trend. Almost 22% of all studios (= workplaces)
observed in the museum sector, where places of bus i-
disappeared between 2001and 2005 - in absolute num-
ness dropped from a turnover high of CHF 443 million
bers this breaks down to 200 studios. In connection
in 2002 to a low ofCHF IS0 million in 2005. This corre-
with this, employment numbers dropped 24.3%. From
sponds to a reduction of two thirds of all museum-
1335 registered workplaces in 2001only I 010remained
related turnovers. However, one reason for the drastic
in 2005. Although the art trade generated veryhigh total
change in museum data could be their statistical reclas-
turnover, it also experienced a steep decline in work-
sification, from private art revenues to the market
places and employment during the four-year period. The
branch ofart dealer
[SEE CHAPTER 3.3.1].
number ofworkplaces dropped from 541 in 2001to 490
Ofall the sectors in the creative industries, the art
in 2005 (-0.4%) and employment dropped from I 251 to
market is the sector with the largest number of cluster
I n8 (-ro.6%). This trend shows that the art dealer sector
units, yet this structural feature is only partially
could not generate sustained good turnover throughout
reflected in the breakdown ofthe different types ofturn-
the sector, but that the turnover stems rather from a few
over. For one, the CHF 49 million generated by self-
large and international enterprises. Afurther process of
employed visual artists are only the total taxable reve-
decline was suffered by the antique trade sector, where
nues. But there are a number ofvisual artists who gener-
the market share lost almost one fourth of its work-
ate only tax-free revenues and are therefore not
places and employment potential.
documented in the VAT Statistics. In addition, the total
Only the art restorer group and the museums devi-
annual turnover of many artists did not amount to
ated from this trend during the four-year period. While
CHF 75 000, which is the minimum that enterprises
the number of workplaces dropped n% between 2001
have to generate in order to be included in the VAT Sta-
and 2005, employment increased n% in the same time
tistics. visarte, the visual artists' professional organization, with over 2 500 active visual artists, is the main
frame. The museum sector even increased the number of its workplaces (+4-4%) and the number of jobs also
umbrella organization in Switzerland, and assumes an
rose ro%. This was possible during the poor economic
average annual income ofCHF 30 000 for visual artists.
situation only ifpublic financial support was at hand.
Moreover, the reported total turnover generated by gal-
Regarding the level ofemployment, the structural
leries and art dealers are also for the most part tax-free,
composition of workplaces in the art market proves
because they report 56% export revenues.
that very small business unit clusters dominate the art
'" '"
market more than any other sub-market in the creative industries. 82% of all art market workplaces consist of studios, bureaus, or workshops with one or two employees. In the creative industries as a whole, this rate is only 58%. In total, 99% of the workplaces in the art market are classified as micro-enterprises. Only the museum sector boasts a share of 16% of workplaces with more than ten employees - but again this is affected by the combined category ofpublicly financed museums. In addition to large enterprises, a functioning art market consists of numerous micro-enterprises and mixed business forms - the basis for an art sector that is still developing. Nevertheless, until 2005 the regional Swiss art trade did not develop in the same manner as the international art market, because its regional market is marked bya steep process ofdecline in the number ofemployees and workplaces. The art market also exhibits processes of disengagement that can lead to new market structures for the development of new visual products and services. The "old" value-added relationships are increasingly changing: new forms of direct marketing are replacing the traditional relationship between artist, gallery owner, art dealer, collector, or museum. Nonetheless, developing an international production of art will always depend on a good local-regional infrastructure. Without a broad base, first-rate art is still unimaginable!
-e
'"
PORTRAIT: THE ART MARKET FROM THE PERSPECTIVE OF THE ART GALLERIES ASSOCIATION SWITZERLAND (AGS)
"The art market is on the move again. A year ago, it was still unimaginable that a work of art could sell for USD 140 million. Auction houses arereporting record sales, particularly in thejield of contemporary art. There is a lot of money swimming around in this world that wants to be invested. Aboveaverage stock market rates of return are f10wing generously into theart market. Butthe question is whether our 54 members can also benefit from this expansion. 'Yes and no' should be the answer. On the one hand, some galleries represent very importantartists, who have managed to command high prices and a high demand on the international market. Yet most of these artists have a rather local or regional quality. These artists and galleries profitfrom the public's general desire to purchase. Butthis isnot where the big money canbe made. Galleries have to be based on a better and more stablefoundation. All the media reports are calling for caution. What is truefor the top-shot section of the world might not be truefor the local Swiss market. The Art Galleries Association Switzerland has been advocating good, relevant infrastructurefor Switzerland for a while. These do infact existand some German galleries have decided to establish second galleries here. This is attractioe.jirst of all, because ofthe interested public here, but also for tax reasons and Switzerland's good, relevant infrastructure.Good infrastructurefor dealers include: an alternative tax environment, waiving resale rights, no artists' social security funds, low VAT rates, and simple tax procedures. These elements lower costs and raise the galleries' and the artists' net turnover. Switzerland is attempting ingeneral to be an attractive business location. This is especially applicable to gallery owners, because art works are first ofall very mobile and - as ourinternationally acclaimed member Hauser undWirthdemonstrates - a location can be moved to a place that o.ffers the
best chances of success. Owing to ourdiverse network and our broad and varied activities (in collaboration with other art dealer associations), we are very optimistic aboutmaintaining our position as the world's fourth most importantart dealer location." Source: AGS business report 2006.
EUR million
EURmillion
Auctions
Art trade
Uk. Ir
Germany
md
Italy
-'70 .'" l;·H
IH';I
II
47 23
12 43
10
90 . 0
("49
20 4.9
. 'tJ111
Europe
Share
6 76H
Illll
\I[drl
EUR million Total
1';0.2
li't;.)
j,
4 j. ~
'; 545·~
100
THE SWISS ART MARKET COM PARED WITH EUROPE. 2001.
Source: Kusin & Company,
2002.
to
'"
PORTRAIT: MEMBER STRUCTURE OF THE VISUAL ARTS
3.3.5 THE FILM INDUSTRY
ASSOCIATION (VISARTE)
OVERALL ASSESSMENT OF THE SWISS FILM INDUS-
visarte consists of 18 regional groups and one interest group (for gender issues). The association has a total of 2 518 members, 1117 ofwhom arefemale artists and 1 381 are male; 187 are architects. 816 members have thestatusof patron.
TRY
The Swiss film industry is comprised of stage and
film artists, scriptwriters, and directors, as well as film production including TV production, film distribution, cinemas, and, exceptionally, film financing programs. The film industry is the only cultural market in the cre-
COMMENT ON THE REPORT ON SOCIAL SECURITY FOR
ative industries that receives favorable basic conditions
CREATIVE PROFESSIONALS
as well as substantial public funding to directly finance
"visarte, the visual art's professional organization, deeply regrets the report regarding social security for creative professionals. It is a missed opportunity to seriously consider existing analyses by the Federal government and cultural associations, and to provide constructive solutions. Demanding that creative professionals be more self-sufficient detracts from the structural disadvantages that artists are faced with - such as unemployment insurance or occupational benejit plans (BVG). Therefore, most cultural associations offer their members insurance opportunities within their range ofcapabilities. The difficultjinancial situation of many artists proves that thisis not enough. The Confederation must change the inadequate j1exibility of social security and unemployment insurance to adapt to reality, and not the creative professionals or their associations. Early on, various cultural organizations petitioned emphatical!yfor improving existing legislation, within thescope oftheLaw on thePromotion ofCulture, so as to ben~fit creative professionals. Visarte does not accept the solution proposed by thefederal offices, which simply states that artists shouldjind the solution themselves."
all stages of production. Backing film production both
Source: visarte Switzerland media release, March
I, 2007.
economically and culturally is a practice in Switzerland - as well as throughout Europe [SEE CHAPTER 7.3.1] the objective ofwhich is to help secure a viable presence for its respective national film production in the international market. Many other sub-branches in the creative industries refer to these national and regional public film subsidy policies and would like to enjoy similar favorable conditions in their own branch. During the period of the survey the film industry experienced an upward trend compared with the general trend in other sub-markets of the creative industries. Different subsidy models, such as the Swiss Federal Office ofCulture's success-related film subsidy program "Succes Cinema" and the "Pacte de l'audiovisuel" between the film industry and the Swiss radio and television broadcasting corporation (SRG SSRidee suisse), show the close relationship of exchange between the public and private sectors. Hence, radio and television stations are also producers, distributors, and patrons. According to data provided by the Swiss Federal Statistical Office, the film industry received approximately CHF 64.6 million in public and private monies in 2004 to finance film and television productions. This is an increase of 45% from 2001, when only CHF 44.7 million were available.
'" ic
ENTERPRISES 2SS1-2SS5 (VAT STATISTICS)
Companies
4·yrar change
Numbrr 2001
Numbrr 2002
Number
Number
200 3
1004
FILM INDUSTRY
854
87 6
9 10
Theater and ballet groups (including selfemployed stage artists and directors) · j Filml'IV and video produ cer Film and video distributors Cinem as
626
TOTAL TURNOVER 2SS1-2SS5 ( VAT STATISTICS)
50 647 51 128
122
12 5
CHFmillion 2001
CHFmillion 2002
CHFm illion 200 3
CHFmillion
1 262
1343
14 12
50 12 5
in'" 200 S/01
in'" 2004/ 0 3
in'" 200S/04
101 5
18·9
6·7
4·5
0.0
0.0 7. 1
23 ·5 14.0 5.6
Total turnover
FILM I NDUSTRY Theater and ballet groups (including selfemployed stage artists and d irector s) ' ) Film1'IV and video producers Film and video distributors Cinema s
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2SS5 (VAT STATISTICS)
97 1
Thea ter and balle t groups (inclu ding selfemployed stage art ists and d irec rors) " Film/1V and video producers Film and video distributors Cinem as
6·5 .6 5. 6
r-yea r cha nge
1004
15 28
143 1
13·4
8.2
-6·4
68.6 21.1
26,3
-2·7 - 5·9
10.8
- 8· 7 10·3 -19. 0
8·5
- 19·9
161
174
220
201
553 253 377
585 29 6
593 32 8 38 7
654 266 3 10
in% 2004 10 3
in % 200S104
i.3
of which
Turnover of
2005
-I
17·9 2·5
in % 200sI o I
119
CHF millio n
- I.
CHFmillion 200S
54 0 273 3 29
Total turnover
FILM INDUSTRY
4-yra r change
357
r-yea r change
Nu mbr r 200S
Turnover at red uced VAT rate CHF million Sha re 1005 in '"
Turnover at normal VT rare CHFmillion Share 2005 in '"
turnover CIlF m illio n Share 2005 in '"
CIlFmillion Share 2005 in '"
4 52 _ _
222
16
69 1
24 2
17
216
15
4 6 0
22
II
8
2. 0
3 64 2.26 80
56 8 26
0 199 30 36 ~ 2 6
168
II
sma ll enterprises CIlFmillion Share 200 S in '"
143 1 201 654 266 3 10
WORKPLACES AND EMPLOYMENT 2SS1 UND 2SS5 (SWISS BUSINESS CENSUS) FILMINDUSTRY Theater and ballet groups (including self-employed stage artists and directors) ' ) Film1'IVand video producers Film and video dis tri butors Cinemas
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2SS5 (SWISS BUSINESS CENSUS) FILM I NDUSTRY Thea ter and balle t group (inclu di ng self-employed stage artists and directors) oj Film/1V and video producers Film and video distributors Cinem as
9 40
2 0 209
3
67
Workplaces
4·year change
Number
Numbr r
2001
Tax-exempt
Export
48
tu rno ver
Person employed"
5 34 _ _ 2 12
4
4·year change
Numbrr 200 1
Nu mber
2005
in '" 200siOl
2005
in '" 200 s iol
1082
1 163
7·5
661 0
7 0 28
6, 3
135 652.
133 745 48 2.37
-1.5
2068 1 843 23 6 24 63
2121 20 97 273 2537
2.6 13.8 15·7 3·0
47 24 8
Workp laces
14·3 2.1 - 4·4
ofwhich . workplaces with ... employres "
Num be r 200S
1-2 Sha re in '" ofall wo rkplaces
2 -5 Sha re in '" ofall wo rkplaces
5 - 10 Share in '" ofa ll workp laces
re and more Share in '" ofall wor kplacr s
1159
55
30
9
6
13 2 744 48
51 68 48 18
27 23 21
10
12
5 19 17
3
235
CHART 15_ KEY DATA ON THE FIl.M INDUSTRY.
Notes . " ind ividu al bus iness branches assigned to different sub-markets: " fUlI- and part-rime employees; " not including enterprises in the non-market business sector; " fu ll- time equivalent. Sources : VAT Statistics , IT A; Swiss Business Census. S FSO: Cre ative Ind us tries Research Unit / ZlldK; own calculation .
53
12
Over the next few years, technological advancements
of enterprises, which increased only slightly from 125 to
will change film industry's individual stages ofproduc-
132 cinema enterprises in the four-year comparison.
tion drastically, provided that digital technology
The film industries generated CHF 1.4 billion in
becomes established in film production and in movie
turnover in
houses. It might trigger a boom in small film producers,
proceed with the same dynamic as that in the number of
who would then gradually shift to video production.
enterprises. This 13.4% presents above-average growth
Hence, the digital, technical amalgamation of DVD-
compared with the creative industries as a whole. How-
2005.
Yetits turnover development did not
video, film, TV, and computer could become a new major
ever, this positive number is attributed only to the two
developmental and creative basis for many filmmakers.
segments offilm production and stage and film artists. The negative rate ofgrowth in film distribution and cin-
THE FILM INDUSTRY FROM THE PERSPECTIVE OF THE
emas already imply that the development of the film
The number of
industry was entering a crisis at the time, and it actually
SWISS FEDERAL TAX ADMINISTRATION
enterprises and self-employed persons in the film indus-
suffered a 6.4% loss oftotal turnover. Iffilm production
try (excluding broadcasting and AV market) was 1 015 in
companies had not experienced a positive growth rate
This includes the group ofstage artists and direc-
of 10.4% in the present comparative year of the survey,
2005.
tors with 53 freelancers. The largest sub-group in the film industry is that offilm and TV-filmproducers who, with approximately 770 enterprises, comprise three
One particular feature of the film industry is the
fourths ofall enterprises in the film industry as a whole.
strikingly even distribution of different types of turn-
Film and video distributors, with 57 enterprises, are
over. From the CHF 1.4 billion total turnover, CHF 691
among the smaller members of the branch, while the
million, or almost half, is subject to the standard VAT
cinema landscape boasts 132 enterprises, which actu-
rate of 7.6%. Ofthis, CHF 364 million are attributable to
ally conceals the true number ofjust under 240 cinema
film production and CHF 226 million to film distribu-
companies throughout Switzerland.
tion. The remaining three types of turnover are subject
the number ofenterprises in
to the reduced tax rate, namely export and tax-exempt
the film industry began rising again by 4.5%. The fouryear comparison with 2001 displayed a large increase in
turnover, is distributed between a turnover volume of CHF 220 to 240 million, respectively. Cinemas, with the
film companies. Their number rose from 626 companies
sales oftax-advantaged tickets, boast over CHF 200 mil-
in 2001 to 773 in 2005; a growth of almost 24%. Cur-
lion - a lion's share ofreduced-tax turnover. Film export
rently, between 6 and 7% new film production compa-
generated approximately CHF 200 million mainly
nies are entering the film industry each year. The film
through film production companies. Exempt turnover,
Compared with
(D
'"
then the film industry as a whole would have undergone a loss ofover 10% in turnover.
2004,
distribution sector displayed a moderate growth in the
which stems from tax-exempt public funding, mainly
early years, yet most recently suffered a clear drop in 13%.
produced bystage and film actors, amounted to CHF 168
Cinemas have changed very little regarding the number
million.
THE FILM INDUSTRY FROM THE PERSPECTIVE OF
workplaces increased approximately 14.3% in the four-
a high at the moment. Inthejirst quarter of 2006, its share of the box office was 14%.This rate was 6%in thepreceding year, which was already quite high compared withbeJore. The Swiss public (a population of approx. 7.2 million) visits the cinema an average of2.) times a year despite the high price oJtickets (EUR 9 on average). There has been much money invested in project development over the last Jew years. Success-related subsidies created the incentive to invest in Swiss jilms on ell levels (production, distribution, cinema)."
year period, 2.1% ofwhich attributable to film distribu-
Source: www.mediadesk.ch.
OFFICIAL STATISTICS As demonstrated by the key
data chart, 1 163 workplaces existed in 2005 with an employment volume of728 persons (full- and part-time). There was a positive development ofemployment in two of the film industry's branches between 2001and 2005; it was negative in two other branches. This again is attributable to film production and distribution, where
tion. Workplaces in cinemas dropped 4.4%, as did the group of stage and film artists (-1.5%). The film industry's labor market figures are particularly significant. Here, positive effects were displayed in all four of the industry's branches. In total, the number of employees rose approximately 6.3%, the leading branches here being distribution (15.7%) and film production (13.8%). The film industry is also made up mainly ofmicroand small enterprises. 55% of film companies are owner-operated bureaus and studios with one to two employees. 94% of film companies have fewer than ten employees per workplace and are therefore classified as micro-enterprises. Only 6% of all film companies are able to employ more than ten employees per business unit. PORTRAIT: THE FILM INDUSTRY FROM THE PERSPECTIVE OF MEDIA DESK SUISSE
"Approximately zyjeuturejilrns andan equal number ofdocumentaries are made per year in Switzerland. Co-productions accountfor aboutonejifthoJthat number. There is a good production basis available for producing jilrns in Switzerland (equipment, laboratory, special effects), which in some cases is respected internationaIty. The Swissfilm industry is enjoying
Visitor rate (per person per year) Boxoffice Average ticket price
2.23 24 5 mio. CIIF '4 .55 CIIF
Number ofvisirors German -speaking Switzerland Prench-spcakiug witzerland Italian-speaking Switzerland Total visitors 2005
545 370
Market hare in percent USA Europe Germany France United Kingdom Spain Switzerland Others
wiss film production (200 ) Produced full-length fe.uurc films 100% Swiss production Debut feature Premiered featu re films Produced full-length documentary films 100% Swiss production Debut feature Premiered documentary films
17 15
18 22
6 27
28.21
8.5 1 2.15 9. 62
Source for all data: www.mediadesk.ch.Filrnindustric Schweiz (accessed on April 17. 2007). A detailed overview of Swiss film financing is provided by the film and cinema statistics of the Swiss Federal Statistical Office, www.bfs.admin.ch,
3.3.6 THE BROADCASTING INDUSTRY
The broadcast-
increased only slightly between
2001
and
2005,
the
ing industry is now dominated by a dual structure
number of TV enterprises,
throughout almost all of Europe. In addition to broad-
sistent. Only one to three enterprises disappeared over
casting companies financed either by public resources
the four years.
51,
remained relatively con-
or by fees, there are also private companies that finance
The broadcasting industry primarily consists of a
their programs through advertising, direct sales, and -
few very large enterprises. The relatively small number
in Switzerland - through fees. Because the official sta-
ofenterprises generates an enormous turnover volume, producing in 2005 approximately CHF 2.2 billion. After
tistics cannot break down the structure of the broadcasting industry into public and private units of enter-
increasing to CHF 2.5 billion by 2003, turnovers demon-
prise, it will be examined in the statistical analysis as a
strated a downward trend. This is mainly attributable to
mixed creative market. The key data chart shows that in
TVenterprises, which claim the lion's share ofturnover
approximately 100 to
2005
there were
with CHF 2.0 billion. Nonetheless, by 2005 an improve-
enterprises in the broadcast-
ment in turnovers can be seen. The total turnover ofthe
ing industry, a number that remained by and large con-
Swiss broadcasting industry once again demonstrated a
sistent over the four-year survey period. Whereas the
growth rate of 4.0% between
105
number ofbroadcasting enterprises amounted to 55 and
2004 and 2005.
ENTERPRISES 2881-2885 (VAT STATISTICS)
Com pan ies
4-year cha nge
Number
Number
1001
2002
104
97 47 50
BROADCASTING I NDUSTRY Radio channels (compan ies) Televisio n cha nnels (compa nies)
TOTAL TURNOVER 2881 -2885 (VAT STATISTICS)
2
Radio cha nne ls (compa nies) Television channels (com pa nies)
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2885 (SWISS BUSINESS CENSUS) BROADCASTING INDUSTRY Radio and television ins titu tions
4-year change in%
200'
2001
200
2005
2005/01
212] 11 7
2270
25 0 8
12 7 2 14]
128
21 9 8 I 0
].6 28.1 2.1
200 5
2 ]80
2 0 48
1.0
1·9
5. 8
0.0
- J.9
4. 1
in %
200 /0
in % 2005 104
4.0 6.
- 15·7 9·9 - 17.1
J.9
Tm al
turnover
of wh ich
Turno ver of small
21 98 150
2
20 4 8
0 0
workplaces
Turnover
Tu rnover at
enterprises CI IF million Share 2 005 in%
31 normal
reduce d VAT rate CHF million Share in% 2005
VTrate Cl lF million Share in% 1005
119 0 8 1182
9 29 I 7 792
4-yea, chan ge
54 5 58
Export
42
turnove r
CIIF million Share in% 1005
]0
39
Person . emplol'cd "
29
4-year cha nge
in%
Numb er
Numbe r
in%
2001
1005
2005101
200'
2005
2005' 0'
1]5
1]2 76
- 2.2 - .8
7 008
0 ·7
56
0 .0
4 082
7 058 s 14 2 s 9 16
79 56
WorkplaC'cs (I
29 26
7·4 - 4.1
ofwhich. workplaceswith... emplo)'CC's cf)
,-,
200 5
Shar e in % ofall wo rkplaces
Share in % ofall workpl aces
Sha re in % o f all work laces
io and more Share in % ofall wo rkplaces
1]2 1] 2
16 ,6
10 10
15 15
59 59
Num ber
' -5
5 -'0
No tes: ' )individual bu siness bra nches assigned to diffc rcn t sub-ma rkers, bJ full- a nd pa rt -time emp loyees; en terp rise. in the no n-ma rker bus ines s sec to r; " full-l ime eq uivalen t. Sources: VAT Statistics , I'rA; Swiss Busi ness Cens us . SFSO; Creative Ind ustries Resea rch Unil/ ZlIdK; own calculation,
Tax-exempt turnover CHFmi llion Share in % 2005
]2 0
Numb er
Num ber
CHART 16 _ K EY D AT A ON TH Ii II ROAD A STI NG INDU STRY.
<J nOI including
in % 200510 4
r-year cha nge
CHFmi liion
2 II] 141 19 7 2
in% 2004/ 03
- 1.9
51
CIIF miliion
2005
WORKPLACES AND EMPLOYMENT 2881 UNO 2885 (SWISS BUSINESS CENSUS) BROADCASTING INDUSTRY
2005/01
2 005
CHF million
CIIF millio n
Radio chan nels (co mpa nies) Television channels (co mpanies)
200
r-year change
in%
CIIF million
Radio channels (compan ies) Television cha nnels (companies )
BROADCASTING INDUSTRY
Number
Total turnover
BROADCASTING INDUSTRY
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2885 (VAT STATISTICS)
Number
3 29
2
Observing the turnover types shows that turnovers at reduced VAT rates amounting to CHF 1.2 billion are somewhat higher than turnovers at the standard rate, whichgenerated approximately CHF 930 billion in 2005. Because broadcasting has a cultural function as well, it can chargethe reduced VAT ratefor these services.This tax concession is also available to the book market and othercultural services. Export and tax-exempt turnovers are almost nonexistentin the broadcasting industry. This creative market is also irrelevant for small enterprises - a fact confirmed by the Swiss Business Census statistics of the Swiss Federal Statistical Office (SFSO), which show that, since the majority of broadcasting enterprises embrace almost 60% ofall workplaces, the broadcasting industryis one ofthe largestin the creative industries. Ingeneral, both public and private broadcasting enterprises areessential to the creative industries formanyreasons. Theyare the main promoters of the creative industries' performance sector, theyoperate on the creative market with their own production companies, and they are an important, directinvestorin film andTV production. In addition to funding models by the department of culture's success-dependantfilm subsidyprogram, "Sueces Cinema," there is the "Pacte de I'audiovisuel" between the film industryand the Swiss radio and television broadcasting corporation (SRG SSR idee suisse). These are examples ofa close relationship of exchange between the publicand the private sectors (see the SRG SSR idee suisse subsidyfigures below). PORTRAIT: THE NEW SWISS RADIO AND TELEVISION LAW "On March 9, 2007, theSwiss Federal Council setthedatefor
entry intoforce of the totally amended Federal Law on Radio
and Television (LRTV) would come into effect April 1, 2007. At the same time, it issued the implementing provisions in the new Decree on Radio and Television (DRTV). The Law on Radio and Television adopted by parliament on 24 March 2006 is intended to ensure a continued strong public service from the SRG in thefuture; atthe same time, various regulations affecting private broadcasters are being relaxed. In addition, support for private local-regional broadcasters from fee revenue (splitting) is being expanded. At the centre of the new Law on Radio and Television (LRTV) is the intention to maintain an independent Swiss olfering of programming which covers all linguistic regions to thesame standard and which cancompete with programming from .financially stronger broadcasters from neighbouring states. To this end, on the one hand the position of the SRG is being assured, andontheother the private Swiss radio andtelevision broadcasters are being strengthened. A key section of theLaw deals withthe dissemination of radio and television programmes via telecommunications and considers in particular theeBects of digitisation. The completely revised Law also introduces major new features in other areas." PRINCIPLES OF THE NEW LAW:
EXTENSIVE DUAL SYSTEM: The existing LRTV substantially protects the SRG as a public service broadcaster from both linguistic-regional and national competition from other broadcasters. The SRG wi!! now have to secure its position as a service provider, no longer through protection from the competition, but by collecting enough fees. Private broadcasters can now enjoy easier access to the market, will be released Jrom specific mandatesfor presentation, and wi!! have morejinuncing opportunities because advertising regulations will be brought in line with European standards, and thusadapted to the international situation(Jor example, commercial breaks).
It will furthermore be discussed whether SRG's commercial opportunities should be limited to benefit the private sector.
With S 861 employees, annual turnover ofCHF 1.S billion, 16 radio channels, 7 television channels, websites and text services, the SRG SSR (head office) is thelargest enterprisefor elec-
tronic media in Switzerland. Its radio programs and, in prime The requirements for concessions have been signifi- time viewing, also its television programs, are themarket leadcantly simplified for private enterprises. Concessions for pri- ers in allfour linguistic regions and have remained strong vate broadcasters who donotrequire high frequencies willnow despite competitionfrom morefinanciaHy stableforeign channeed to apply merely for a police licenseJor content authoriza- nels. This public success is one of the requirements of its pertion. In particular, it will no longer be the State that decides formance mandate, which theSRG SSR received from thegovwhether a radio or television project is econornicullq worth- ernment. Itsqualitative position as market leader is an equaHy while. ambitious objective. The SRG SSR is not only committed to success, but also to a high standard of journalistic ethics, LIMITED SCOPE OF THE LAW: The LRTV's Juture scope respecting human dignity, credibility and a high level oJprowill be limited to broadcast programs. Therefore, only content Jessionalism." that actuaHy possesses a certain journalistic significance orthe Source: Swiss Broadcasting Corporation SRG SSR ideesuisse. power to influence the public will be regulated. InJormation retrieval services, such as teletext, will no longer be subject to 3.3.7 THE PERFORMING ARTS MARKET the LRTV. The way content wi!! be distributed in this age oJ OVERALL ASSESSMENT OF THE PERFORMING ARTS convergence is irrelevant Jor the !egal classification oJ offers MARKET Theperforming arts area unique market in the MORE LENIENT CONCESSIONS FOR PRIVATE ENTERPRISES:
and services. Services distributed via the Internet wi!! be subject to the LRTV only if they contain programs oJjournalistic significance and can influence public opinion. Source: Federal Office of Communications. OFCOM, www.bakorn.admin.ch.
PORTRAIT: SWISS BROADCASTING CORPORATION SRG SSR ID~E SUISSE
The SRG SSR idee suisse is a private media firm and is supervised by the principles of stock corporation law. Its brief is based on the Federal Constitution, the Federal Law on Radio and Television (LRTV), and the concession, and is committed to public service. As a non-profit organization, SRG SSR is financed to roughly two thirds through Jees and one third through commercial activities. It is politically and economicaHy independent.
creative industries. Public financing structures dominate theaters throughout Europe - a fact that also applies to Switzerland. The financial and personnel structure of State-sponsored opera housesandtheaters placethemin the contextoflarge corporations rather than a privately run, clustered theater sector. However, they both share an intermediate area characterized bya rich, locallyand regionally based amateur sector, which also resembles the federalist small-unitstructure of Switzerland. The above-mentioned relationship between taxfree and taxable turnovers is proof of the theory that "capillary" relationships ofexchange betweenthe State, intermediate, and private sectors are essential to the cultural sector. State and commerciallyfinanced services can complementone anotherand should therefore not be viewedas opposite pairs.
The data presented should however show - despite the
ers. Here, taxable turnover makes up the bulk of turn-
very rudimentary state ofthe information - that the per-
over. So, the so-called "other services" of the cultural
forming arts market in Switzerland, from the creative
enterprises, (theater and concert ticket sales, agencies,
industries perspective, is showing a clear shift towards
directorates, etc.), plus the export share, generated a
an extended creative scene structure. The number of
taxable turnover ofCHF 105 million in
2005,
while the
small theater ensembles, the activities of independent
tax-exempt share amounted only to CHF 6 million.
theater groups, and the cabaret sector will increase, and
Other typical enterprises in the cabaret arts, such as
there will be fewer established positions in publicly
acrobat groups, puppet theaters, circuses, etc., gener-
funded theaters.
ated CHF 128 million in taxable turnover, and CHF 53
Performing artists are developing ever more com-
million in tax-exempt turnover.
plex career structures; they are becoming increasingly
The large share of tax-exempt turnover from the
self-employed, yet not less dependent. Performing art-
entire performing arts market makes the share ofturn-
ists are dependent on the market structure on many lev-
over seem unusually low for the small enterprises. In
els, as well as on the promoter or organizer (theatre,
reality however, theater professionals and the cabaret
broadcasting, film) for their services to be shown and/or
sector playa significant role in the theater industry. Yet
played and critiqued. Traditional, secure working condi-
it has long been very difficult to establish a realistic sta-
tions (through secure jobs) are disappearing. Moreover,
tistical depiction of this sector, and it is unsatisfactory
it will become difficult to differentiate between employer
primarily because the professional and economic activ-
and employee, and the subsequent business models
ities of the performing arts market are very different to
reflect this type ofhybridization
the traditional categories usually included in the data.
[SEE CHAPTER 5].
The development of the total turnover increased THE PERFORMING ARTS MARKET FROM THE PERSPEC-
dynamically in the four-year period of 2001-2005, and
TIVE OF THE SWISS FEDERAL TAX ADMINISTRATION
generated growth of34.6%, which is chieflyattributable
For areas relevant to the private economy, the data
to the theater groups and stages. Yetthe period between and
however, shows only a slight growth of
shows that theaters and concert halls in particular, as
2004
well as theater and ballet groups and the self-employed stage artists represent the classical mixed structure of
2.1%. Of the four designated segments, three did not
produce positive turnovers, whereas the 19.1% increase
employment. Their annual turnover is comprised of a
reported by the theater sector had a positive influence
large share oftax-exempt turnovers. For the theater and
on the overall trend.
ballet group and the self-employed stage artists in 2005, this figure amounted to CHF 168 million (taxable share CHF 33 million), for theaters and concert halls CHF 127 million (taxable share CHF 126 million). The opposite is true for theater and concert ticket offices, and other auxiliary services, as well as for circuses and puppet theat-
2005,
ENTERPRISES 2BBl-2BB5 (VAT STATISTICS)
----
Compa nies Number 200'
4·ye ar cha nge Number 200 2
Number
Number
1003
2004
Number 1005
r-yea r cha nge
in% 2005101
in% 200 4/ 03
in% 100 5104
6.6 0.0 .0.8
193
TOTAL TURNOVER 2 BBl -2BB5 ( VAT STATISTICS)
192
'95
208
2 I
Total turnover
'9·7
1 002
200 1
PERFORMING ARTS MARKET Theater and ballet companies (incl. self-employed stage artists) .) Theaters, opera houses , playhouses a nd concert halls ' ) Other culture and entertainme nt services .) Additional culture and entertainment facilities (circus , se lfemployed acrobats, puppet thea ter
.1004
200
in ~
580 II
7 81 20. 288 II I
220
t75
.0.
200 5/0'
1005
II
186
4· 7
2·9 1.0
8· 3
II.I
" year cha nge in ,*in% 2005 /04''2004/03 _---'=""-='
4-year chang e
CII F million CIIF million CII F million CIIF mill ion CII F millio n
4. 8 - I.
2.1
13.0 26,3 6.0
- 2.2
.81
2.1
Total
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2BB5 (VAT STATISTICS)
PERFORMING ARTS MARKET Theater and ballet companies (inc!. self-employed stage artists) .J Theaters, opera hou es, playhou ses and concert halls , j Other culture and entertainment services .J Additional culture a nd entertainment facilitie (circus, selfemployed acrobats, puppet theater
of which
tu rnover
CII F million 2005
7
_ 61
201
55 9
4
_2
5
~ 29
III
12
II
.8 ----
22
.2
.2 ----
7 _ _....;.8_ 8
4·year change
Personsemployed b)
Workplaces
WORKPLACES AND EMPLOYMENT 2BBl UNO 2BB5 (SWISS BUSINESS CENSUS) PERFORMING ARTS MARKET Theater and ballet co mpan ies (inc l. self-em 10 ed sta e artists) ' ) Theaters, opera houses, playhouses an d concert hal ls " Other culture and en tertainmen t serv ices .J Additional culture and entertainment facilities (circus, selfemployed acrobats, puppet theater
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2BB5 (SWISS BUSINESS CENSUS) PERFORM I NG ARTS MARKET Theater and ballet companies (incl. self-ern loyed stage a rtis ts) .) Theate r , o pera hou ses, playhouses a nd concert halls ' ) Other culture and entertainment services .j Additional culture a nd enterta in ment facilities (circu s, selfem ployed ac ro bats, puppet theater CH
Number 200'
8 - _-"-:!.. 253 22
CHF mi llion Share
turnove r
CIIF million Share .:; 2°O= 5 ~
--!!!!!5. ~
---------
J2 _ _4_5 _ _ 6 _ _-,3",,5 3 7 II
16 _8;...
0
84 "- ~
10 16
Tax-exempt
turn over
6 __ 3 _ _--"-~ 53
49
4-y.ar ch ange
Number 200 1
Num ber 2005
in % 2005 /0'
116 5
- 18.0
13 15 2 30 3
-1.5 2.6 - 28·4
8043 2 068 2606 7 6
7 9 21 2 121 28 59 666
- 1·5 2.6 9·7 -16.
- 21.9
2573
2275
- II .6
Workplaces <, Number 2005
2005
44 9
ofwhich. workplaces with ... employees " '- 2 Share in % ofall workplaces
- '0
2- 5 Shore in % ofall workplaces
5 Sha re in % ofall workplaces
ro and more Share in % of'all workpl. ces
9 10
12
935 I 2
56
28
'39 21
38 74
27 22 20
19 4
20 2
449
54
34
8
4
RT 17_ KEY DATA ON THE PERFORMING ARTS MARKET.
45 83
1_2-,;7 ---±!. 6 ---l.
2_2 _ _ 8 .6_ ---.2.i
in % 2005 '0'
575
Number
Note : .. individual business branch a ssigned to different sub- markets: " full- and part-time e mployee : including enterprises in the non-market business sec tor: d, fu ll-lime equivale nt. So urce s: VAT Sratistics, FTA; Swiss Business Census. SFSO; Creative Ind ust ries Resea rch Unit ] ZIIdK; own calc ulatio n.
<' not
Expon - -
Turnover of Tu rnover at Turnover small reduced at normal VAT rare enterp rises VT roue CIIF million Sha re CIIF million Sha re CIIF mill ion Sha re ~ 5 in % _ _---'= .>.. in % 200 5 in % _ _ ---'20-,00 2005
7
THE PERFORMING ARTS MARKET FROM THE PERSPECTIVE OF OFFICIAL STATISTICS The performing arts
market experienced a decline, according to the Swiss Business Census. The number ofworkplaces decreased by 18% and with it, the number of employees. These structural losses (-22 to -28% ofworkplaces and -12 to -16% of employment) mainly affected the private seg-
ments and other services, as well as acrobats, puppet theaters, etc. There is a clear structural change taking place in this segment, suggesting that the number of one-person enterprises is on the rise. In the levelofemployment category, 56% of the workplaces in the performing arts market employ one to two persons, placing them in the micro-enterprise category. In total, at least 93% of the enterprises are active as micro-enterprises (up to nine employees). The only segments that can boast larger workplaces are the "theater and ballet groups" and the "theater and opera houses, etc." Here, the official statistics are chiefly oriented towards the public theater companies, providing they exist under the legal form of a private enterprise - which explains the 12 or 20% share, respectively, of workplaces in these two theater seg-
"Suisseculture is the umbrella association of Swiss cultural professionals. Its members are Swiss professional organizations from various disciplines (writers, musicians, dancers, actors, .filmmakers, visual artists, etc.) as well as Swiss copyright organizations. At the end of 20°5, Suisseculture sent a questionnaire on thesubject ofemployment and social security to 7 691 cultural professionals, of whom 2 082 responded. Suisseculture's evaluation of the questionnaires is an interesting addition to thefederal statistics mentioned above regarding the employment situation ofcultural professionals. _Many cultural professionals are both self-employed and employee. 291% of the culture! professionals work in this combination of self-employed and employed status.II _ 50.7% of cultural professionals with the sole status of employee do not have a permanent job,,6 but only a temporary contract. _50.3% of the cultural professionals generate an annual income of less than CHF 19 350 (minimum for entry to occupational bene.fit plans until theend of 2006) withtheir cultural activities. _42.1% ofcultural professionals' total income '7 stemsfrom their cultural activity. 57.9% of professionals earn the bulk of their income through activities outside the cultural sector. 'x
ments. PORTRAIT: STRUCTURAL FEATURES OF THE PERFORMING ARTIST BASED ON THE SUISSECULTURE SURVEY
"The social security of cultural professionals in Switzerland. Situation and possibilities of improvement. Report by the working group of the Swiss Federal Office for Culture, Federal Social Insurance Office, and theState Secretariatfor Economic Ajfairs. Approved by theSwiss Federal Council on February 28, 200r"
P,
17
Self-employed only, 50%. Employed only, 20.3%. The word "permanent position" was nor defined by the Suisseculturc 's questionnaire. It generally implies a long-term. secure position. Between 80 and 100% of the total earnings. At least 20% ofthe total earnings is generated outside ofrhe cultural sectors.
Cultural professionals
elf-employed '
National averages
48.3%"
13·3%
I:)I.7'Yo
~6-7'~'
Pull-time '
66.6%
.1%
I' irt-tuuc ,
~~ ..:{%)
2~·lJ%
10·5"10'
6.2"10 1
l.mploycd
I
Employed in more than one job Tcrupor.tr ily em ploycd
Gro s monthly income.' b
50 .7'~, 1
7.2"10 '
CIIF 6649
cur 5500
I' .HC 0 ' unemployed ,. '
-1·7%
3. 1'1b
Rate of unemployed 6. d
9. 6"10
.')%
CULTURAL PROFESSIONALS IN A CROSS-COMPARISON.
Sources: Swiss Federal Population Census 2000. Swiss Labor Force Survey (SUS) 2005. Suisseculture survey. Swiss Wage Structure Survey (LSEJ 2004. Unemployment statistics for July 2006 (SECO). Basis: Unemployment statistics for July 2006 (SEeO) and the Federal Population Census, including employed family members. Not including partly self-employed persons. Full-time equivalent for employees (median). Rate of unemployment I: inclnding self-employed as employed persons. Rate of unemployment I: not including self-employed as employed persons.
2000.
THE CULTURAL PROFESSIONALS IN A CROSS-COMPARISON Based on thesurvey's results, a comparison is given below between the employment situation of cultural professionals and the national average for a!! projessions.
Referring tofour measurement categories, the cross-comparison above particularly shows significant dijferences between cultural professionals and thenational averages: _The share of self-employed persons is approximately four times higher thanthe national average _ The share of persons employed in more than one profession
is almost double that of the national average _ The share of temporary contracts for cultural professionals is approx. seven times that of thenational average _ The rateof unemployment ofcultural professionals is upto three times that of the national average _ The fo!!owing additional information pertains to the monthly gross income ofcultural professionals ofCHF 6 649: _ The cultural sector's monthly gross income of CHF 6 649, established by the Swiss Wage Structure Survey in 2004, applies to actual employees, that is, only to approximately one halfofall cultural professionals. There are no existing, reliable .figures that rejlect cultural professionals' actual earnings. According to a study by the Association of Swiss Painters, Sculptors and Architects (GSMBA)from 1994, only 15% of its members generated a total income of over CHF 50 000 per year. 1<) Moreover, almost halfof ull those surveyed earned less than CHF 30 000. 2 0 The reliability and topicality of this survey cannot be verified, yet we may assume that the cultural professionals in effect earn well under CHF 6 649 per month. _ The gross monthly income of CHF 6 649 is based on fulltimeemployment. Since theshare offull-time positions in the cultural sector is relatively low [66.6%J compared with other economic branches, and since interruptions in careers are more common in the culturcl sector than in other branches (as seen
in the high percentage of temporary contracts and the relatively high rate ofunemployment), it is highly unlikely thatthe reported CHF 6 649 gross monthly income is produced by many employees in the cultural sector. According to theauthor, this amount is more of a theoretical earnings approximation thanan actual, earned income." Members' survey GSMBA, 1994, " Members' survey GSMBA, 1994,
1. 1.
3.3.8 THE DESIGN INDUSTRY OVERALL ASSESSMENT OF THE SWISS DESIGN INDUSTRY
Throughout Europe, the design industry is consid-
ered a growth economy, which, in the era ofthe knowledge and information society, is assuming an increasingly important function in the competitiveness of a country. For a long time design was considered merely an annex to other industries, for example as automobile, furniture, or packaging design, yet a very different picture is currently emerging. The design industry or design market is now an economic branch in its own right and is different on many levels from other economic or business branches. According to the European Commission and the Swiss Nomenclature of General Activities (NOGA), the design sector will be classified into three core sections from 2008 onward. The economic field ofdesign will include the groups ofgraphic designers and communication designers, production designers and industrial designers, interior designers and interior architecture, and other design activities. The design industry is growing into a leading branch within the creative industries, because it has increasing links to almost every other sub-market. These include sound design in the music industry, graphic design in the publishing industry, visual design in the art market, media design in the film industry,
ENTERPRISES 2991-2995 (VAT STATISTICS)
Companies Number
Num ber
Num be r
Nu mber
in %
2001
2002
200 3
2 004
200 5
2005 /01
777 2
7 89 0
799 1
DESIGN I NDUSTRY Ind ust rial desig n. ot her engi neeri ng o ffices (s hare 10%) Product an d graphic de sig n Co mmu nica tio ns d esign . advertisi ng design Communications design , com pany consu ltallts (sh are 10%) Pho to design . photo stud ios Exhibition design, exhi bitio n an d trade fair ind us try
TOTAL TURNOVER 2991 -2995 (VAT STATISTICS)
74 06 28 1 1 86 8 947 4
1005
2005 10 1
6681
6.1
69 8
1 214
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2995 (SWISS BUSINESS CENSUS)
7 19
1 157
1 337
13 03
13 59
2 00 /0
3·4 ---"2·3
_ _ _6_.!.7 - 1·3 3. 1
4 1•0 - 5·4 14 ·4
0 .0
26.2
15·5
11.6
4 ·3
ofw hich
turnover
Turnover of - small enterprises
CI IF million _ _---'2:,:0= 0 5.
Sha re in %
Turnoverat reduced V,\T rate
turnover Tax-exempt CIIFmilturnover CII F m illion Share CIII: m illio n Share CHFmiliion Share lion Share .:; 2 °O ~ 5 ~ 2005 .2. in% in % ~ in % _ _---'= 1005
vr rate
--------------
9 _ _----"'-L. 59 _ _ _ _1-"... 9 __ 4 _ _ _ _1..<.9-"... 9 28 --'4 23 _-----': I ~,..,. ; ~
:
9 135 9 _ _--=26~
Expon - -
Turnover at normal
_ _-,---,618
224
22 1
10
2
.z:«: 25
55
4
4-yea r change
Persons em pl oyed bi
4-yca r cha nge
Numbe r
Number
in %
2001
2005
2005/01
2001
2005
2005/ 0 1
116 9
5 09 Workplaces( I
74 06 260 2 19 1 1 087 2 3 12 10 7 5 19
- 4.1 0 .0 5 092 35 14 9 124 1 811
- 2· 3 7·5 - 8·7 - 11·3 2.0
3 4 59
- 1.1 12.6 -1.2 4. 8 - 1.6 - 14 .8 - 2·4
ofwhich, workplaces with ... e mployees " Share in % ofall wor kplaces
Sharci n %ofall workp laces
10 and more Sha re in % ofall wo rkplaces
260
23 22
7 10
10
2 3 12 10 7
20
10 2
29
13
1- 2
Nu m bcr
o
139
in%
260 224 2 1011
2
3 18
7 o
Numbcr
77 2 2
3
8
7
Num ber
200 5
DESIGN INDUSTRY Industrial design. othe r engi nee ring offices (sha re 10%) Prod uct and g raphic design Communications desi n, advertisi n desi n Com mu nica tio ns design , compa ny co nsu lta nt s (s hare 10%) Photo design, pho to stud ios Exh ibitio n design , exh ibition a nd trade fair ind ustry
720
in %
in % 200 / 0
Tot al
Wo rkplaces
DESI GN INDUSTRY Industrial design . othe r eng inee ring o ffices (s hare 10%) Product a nd gra ph ic design Communications desig n. advertisi ng design Com m unications design. co m pany con sul tallts (sha re 10%) Photo desig n. pho to stu dios Exhi bit ion des ign , exhibition and trade fair industry
.200
-0.
l-yc-ar ch.1ngt"
in %
.2003
2·5 - 1.0 5. 6
6·3
4·)'car ehangc 2002.
2.8
- 1.2 21.8
CIIF million CIIF million CIIF million CIIF mill ion CIIF million .2001
in % 200 /
4. 0 1.6 o.
1182
94 2
Total turnover
2005
WORKPLACES AND EMPLOYMENT 2991 UNO 2995 (SWISS BUSINESS CENSUS)
27 0 1119
in % 200 / 0
7·9 13. 1 10 .8
794
CIIF million
DESIGN I NDUSTRY Industrial design , ot her engi nee ring o ffices (sha re 10%) Prod uct a nd grap hic design Commu nica tions des ign, advertising design Commu nications des ign , compan y cons ulta llts (share 10% ) Photo design , ph oto s tud ios Exhi bitio n design . exhibition a nd trade fair ind ustry
272 2 1 0 53
2747 1 008
DESIGN INDUSTRY Ind ustrial design, o the r engineering offices (sha re 10%) Product and gra p hic design Communications design, advertising design Co mmu nicat io ns design, com pa ny con su ltants (s ha re 10%) Photo design , p hoto studios Exhibi tion design , exh ibitio n and trad e fair indu s try
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2995 (VAT STATISTICS)
I-y ar cha nge
4-ycar eh ang c
Number
Sha re in % ofa ll workplaces
2
CHART 18_ KF.Y DATA ON TIlE DES IGN I N D U ST RY. Not es :" ind ivid ual bu siness br an ch es a ss igned to differe nt sub-m arkets; .. full - a nd pan-li me employees; " no t incl udi ng e nter prises in th e no n-ma rket bu sin e ss secro r. " ful l-time equivalen t, So u rces: VAT Sta ris rics , ~'TA ; Swi s Busines s Censu s , S FSO; Cr ea tiv e lndu srries Resea rch Un il/ z u dx : ow n calculatio n .
5
5
10
4
9
stage design in the performing arts market, and web
lZl
00
and video design in the games industry. New technolog-
the market. Only the advertising designers and photo designers suffered a loss of 1% during this period. Over-
ical developments greatly reduce the problems for
all, the design industry displays a steady rise in develop-
designers in this branch, more than any other ofthe cul-
mentwithin the four-year period ofthe study.
tural branches, because designers define themselves
The design industry generated total turnover of
less and less through the design of products and more and more through the design ofideas and concepts. The
CHF 6.7 billion in 2005; its turnover also increased 6.1% between 2001 and 2005, which is similar to its rate of business development. Nonetheless, only three of the
design industry is presumably the one creative branch that can best develop non-technological innovations.
four economic branches were successful in increasing
However, the design industry is a typical creative industries branch in that it is dominated by a high per-
their turnover potential. In the four-year period, the industrial designers had a 14.6% increase in turnover,
centage of micro-enterprises. The design sector and
the communications designers in business consulting
small enterprises with perhaps some economically
an above-average increase of 41%, and exhibition
weak professionals, and the established small or mid-
designers +14.4%. The remaining design branches, the
sized enterprises with professionals that are success-
product designers, communications designers in adver-
fully active on the market, all create a cottage industry as well as a professional economy. In Chapter 5,
tising, and the photo designers, suffered a 1.3 to 7.4% loss. One can only speculate about the positive turnover
approaches are introduced to shed light on the complex structures ofinteraction between the creative scene and
development displayed by the communications designers in business consulting on the one hand, and the
established enterprises.
negative turnover development in the communications designers in advertising, on the other. It mostly likely
THE DESIGN INDUSTRY FROM THE PERSPECTIVE OF
involves individual large companies that generate sin-
THE SWISS FEDERAL TAX ADMINISTRATION
The
gular yet exorbitantly high turnovers in business con-
number ofenterprises and self-employed persons in the
sulting, which then have an effect on the entire eco-
design industry was 7991 in 2005. This includes the groups of industrial engineers with 318 enterprises, product and graphic designers with 2 070 enterprises, communications designers with 3 886 enterprises collectively, photo designers with 923 enterprises, and
nomic branch's rate ofturnover. On the other hand, the
exhibition designers with 794 enterprises. The advertising market, which is often associated with design as a well-connected sub-market, is accordingly allocated its
structure ofbusiness communication, based on the categorization of the levels of employment in workplaces, is even more clustered than in advertising design. 73% of the workplaces in the communications design segment are bureaus with one to two employees. This is compared with the rate of 53% for advertising designers (see the chart regarding workplaces according to levels
own sub-market in this study and analyzed there.
ofemployment).
With an average growth of 7.9% between 2001 and
The largest share of total turnover in the design
2005, approximately 590 new design enterprises entered
industry, namely 63%, was generated at the standard
VAT rate (7.6%) in 2005 and amounted, in all of the design branches, to more than half of the respective total turnover. Only the communication designers pro-
The design industry is also largely dominated by micro-
duced more than halfoftheir turnover with exports and at the tax-exempt rate. The share of turnover that small
employees. 96% of the enterprises have fewer than ten
enterprises were able to produce is perhaps a realistic reflection ofthe state ofthe design industry. Only 9% of the total turnover, including production designers
and small enterprises. 66% of design enterprises are owner-operated bureaus and studios with one to two employees per workplace and are thus classified as micro-enterprises. Only 4% ofall design enterprises are able to employ more than ten persons per business unit.
(28%) and photo designers (37%) with somewhat higher
shares, were attributable to small enterprises. Yet the official statistics present a very different picture, as is described below. THE DESIGN INDUSTRY FROM THE PERSPECTIVE OF OFFICIAL STATISTICS As the key data chart demon-
strates, 7 406 workplaces in the design industry existed in 20°5, with a total labor force of 24 510 (full- and parttime). Workplaces developed negatively between 2001 and 2005. During this period, approx. 4% ofworkplaces disappeared. Photo designers lost over u% of their workplaces, advertising designers following closely with a loss ofjust under 9%, and product designers with a loss of 2.3%. In business communication, there was an increase of 7.5% and in exhibition design, 2%. The disappearance of workplaces is of course accompanied by a loss in jobs yet - taken as a whole there is only a slight loss of 1.1% here between 2001 and 2°°5·
The industrial design branch displayed the most substantial, positive development in the rate ofemployment and can boast an increase of 12.6%. This is followed by communications designers in business consulting, who enjoyeda 4.8% growth in employment during the same period.
...;
co
PORTRAIT: AN OUTLINE OF DESIGN INDUSTRY PRO-
5. VSI.ASAI. VEREINIGUNG SCHWEIZER INNENAR-
FESSIONAL ASSOCIATIONS It is still difficult to find
CHITEKTEN/ARCHITEKTINNEN
even attempts by professional associations in Switzer-
SWISS INTERIOR ARCHITECTS)
land to collect and compile consolidated data regarding
Members:
(ASSOCIATION
OF
200
the design industry. Internationally, however, there is standardized and professionalized knowledge available
6. SWISSCARTON
and as a consequence, their professional organizations
_ The association of Swiss cardboard and corrugated cardboard workers _Members: 45 enterprises _approx. 3 000 employees _approx. CHF 650 million in turnover
have a much stronger position. 55 The following list reflects the results of a survey, commissioned by the authors, conducted by the Swiss Design Association (December 2006), yet it is not more than a first step toward improving the data bank.
3.3.9 THE ARCHITECTURE MARKET Today, the archi1. DNS DESIGN NETWORK SWITZERLAND
tecture market is considered an obvious sub-market of
_Members: 125 _ The Design Network estimates that there are 150-160 more active design agencies orfirms on the market.
the creative industries throughout Europe. While architecture in Italy or France has long been recognized as a cultural profession, it took some time in countries such as Germany or Scandinavia before architects were
2. SSW LEADING SWISS AGENCIES (ADVERTISING AND COMMUNICATIONS AGENCIES)
_ Members: 70 The association estimates that there are agencies on the market.
included in studies involving the creative industries. For many reasons, the Swiss architecture market is one of the most significant creative industries sub-
100
more active
markets in Switzerland. It is the largest sub-market as regards the number ofenterprises and workplaces, with a share of 28% or 25%, respectively. This equates to
3. SGD SWISS GRAPHIC DESIGNERS
approx. II 500 bureaus with approximately 10 400 work-
_Members: 350
places that provide a variety of architectural services.
4. SDA SWISS DESIGN ASSOCIATION
With 36 300 employees and turnover ofCHF 8.3 billion, it is the second-largest sub-market after the software
Members: 200 _ The organization estimates at most500 more active design bureaus and agencies.
55
N 00
and games industries.
For comparison: With approximately 3000 members, the Alliance of German Designers (AGD)is the largest professional organization in Europe. Source: BEDA-Bureau ofEuropean Design Association - umbrella organization ofEuropean design organisations.
ENTERPRISES 2991-2995 (VAT STATISTICS)
4'~ar change
Compani
ARCHITECTURE MARKET Architecture bu reaus Int erio r architecture bu reaus
Number
Number
Number
umber
In%
In "I>
1001
1001
lOOj
200i
1005
1005 101
lOO;JO j
1° 9 11 10 18 4 85
11 055 10 300
11
5°1 254
5 17 28 4
CIIF million
ClfF million
CII Fm iliion
Cl lF miliion
CiTFmiliion
in o.lt
1001
1001
1003
2 004
1 005
1 0 05 101
4-ye", chang.
ARCHI TECTURE MARKET
80 44
Architecture burea us Intcr io r arc hitccturc bur caus Landscape design
7595 280 168
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2995 (VAT STATISTICS)
turnover
Arch itecture bureaus In terio r architecture bureaus Land scap e design
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2995 (SWISS BUSINESS CENSUS)
Turnover of mall enterpri es CIlF millio n Share in% 1005
82 93 7 8 29 281 182
12 59 118 4 35 40
in% 1 00 5 10 4
8. 1 0.2 8·7
Turnover ar
15
8
12
0 6
22
Number
4 '~ar chang. in %
1001
1005
1 005 /01
8_ _----:2"" 5.:..
Workplaces
Architecture bureau Interior architecture bureaus Landscape de ig n
Turnover
red uced VAT rote CIlF million Share in% 2005
Number
Workplaces
ARCHITECTURE MARKET
Ui
r-year change in% loo;/o j
ofwhich
1005
WORKPLACES AND EMPLOYMENT 2991 UNO 2995 (SWISS BUSINESS CENSUS) ARCHITECTURE MARKET
277 149
13·4
Total
CHF millio n
ARCHITECTURE MARKET
1.0 0·7 - 0. 8
2.0 8.0
Total turnover
3°3 142
In 1005 10;
2.0
147
1°377 5°7 26 3
239
TOTAL TURNOVER 2991 -2995 (VAT STATISTICS)
r-year change
lumber
0 0 0
6 79 2 64 6 228 t28
4
82 82 81 70
Export turnover CIl F miliion Sh.re inCl> 2 005
2 130 106 18 6 3 6 __
4-~rchange
Persons employed " Number
Num ber
in %
1001
2005
100510 1
3495 8 2 628 12 59 1° 71
36 262 337 16 1222
3·7
13 24
23. 6
- 2.1 12.8
- ---"-''''-
at norm al VT .. te CIlF million Share in% 2005
ofwhich. workplaces with ....mployees "' I -I
1 -5
Share in % of all workp l1ces
Share in % ofan workpl1 ces
5-
10
Share in % ofall workp laces
ro and mort hare in % ofall workp l1ces
11 54 5 3° 12 4 3° 2 68 5 ------"------~-----_ _ _ _--0<5'-1 ----'<----"II 9
RT 19_ KEY DATA ON T HE ARC H ITECTURE I AR KET.
oles:') individual business bra nche as igned to different ub-markets: "' fu ll· and part-rime ernployees. <) not including enterprises in the non-market business ector; · )full- time equivalent. ourc : VAT Stati tics, FTA; Swiss Bu in ss Census, SFSO; Creative Industrie R. earch Unit' ZltdK; own calculation.
Tax-exem pt turnove r
CIlF million 1 005
hare in%
88 86 ° 0
The architecture market is one of the few creative mar-
and 2005 shows that architects were one of the most
kets that can be described using clearly categorized
successful members of the creative industries on the
business branches. Based on the General Classification
market during the four-year period. Only the interior
ofEconomic Activities, the Swiss architecture market is
architects suffered a loss of 7.3% over the same time-
divided into three types of architectural activities: the
frame. However, the turnover trend also demonstrates
groups of architecture bureaus with architecture stud-
that, with CHF 257 million in turnover, the economic
ies and consulting services, interior architects, and
low in 2003 has been overcome. Since then, the turnover
landscape designers and garden architect bureaus.
generated by interior architects increased significantly, totaling CHF 281 million by 2005.
THE ARCHITECTURE MARKET FROM THE PERSPECTIVE
The classification according to turnover types
OF THE SWISS FEDERAL TAX ADMINISTRATION
shows that, in all of the three architecture groups, a
As demonstrated by the key data chart, the number of
notable share Of12 to 22% ofthe turnover was produced
architecture bureaus in 2005 amounted to
482, the
by small enterprises. As regards architecture, small
largest group by far being the general architects with
enterprises mean that architecture bureaus with up to
approximately 10 650 bureaus. Compared with this, the
CHF 3 million in turnover can take advantage ofbenefi-
interior architects and landscape planners represent a
cial tax rates (flat-rate tax or bottom-line tax).
II
tiny group of 513 and 322 bureaus, respectively. Devel-
The largest share of architecture turnovers was
opment in the architecture market was positive in all
generated at the standard sales tax rate. At CHF 6.79 bil-
three groups. Approximately 5.2% new bureaus entered
lion, this represented 82% of the total turnover. Archi-
the market over the last few years. The smallest group,
tecture export turnover, of CHF 130 million and a 2%
the landscape planners, enjoyed a 35% increase, the
share of the total turnover, was astonishingly low. Tax-
strongest growth of all the new enterprises. Most
exempt turnover, at a 1% share, played an insignificant
recently, however, the trend in growth began to decline,
role. The architecture market has a special place in the
again with the exception ofthe landscape planners. The
creative industries inasmuch as it practically exists with-
number ofarchitects in 2004 and 2005 increased slightly
out any public funding or special tax breaks.
by 0.7%, whereas the number of interior architects decreased slightly by 0.8%. The total turnover generated by the architecture
-sr CD
THE ARCHITECTURE MARKET FROM THE PERSPECTIVE OF OFFICIAL STATISTICS
The Swiss Business Census
market was CHF 8.3 billion in 2005. Again, the general
shows that architecture bureaus have lost many work-
architects boast the largest turnover volume ofCHF 7.83
places despite good economic development. 4.9% of
billion. The turnover produced in 2005 byinterior archi-
architecture workplaces disappeared in the four-year
tects and landscape planners was CHF 281 million and
period between 2001 and 2005. However, the positive
CHF 182 million, respectively.The architecture market's
economic development had a clear impact on the growth
economic situation was excellent for two of the three
in employment. The architecture bureaus and landscape
groups. The increase in turnover of 18.4% between 2001
planners, who had generated very good turnover in the
surveyed period, used these returns to increase the
PORTRAIT: THE ARCHITECTURE MARKET FROM THE
number ofjobs. In total, the number ofpersons employed
PERSPECTIVE OF PROFESSIONAL ASSOCIATIONS
SIA
in the architecture market rose 3.7% from 34,958 in 2001
SWISS ASSOCIATION OF ENGINEERS AND ARCHI-
to 36,262 in 2005. Investing in new jobs is a clear indica-
TECTS
tor ofthe architecture market's success.
The SIA is a private association divided intoJour proJessional groups: architecture, civil engineering, technology and indus-
This positive development is particularly astonish-
19950 architects generated a total turnover ofCHF 8.39
members include 5 500 architects, 20 landscape architects, and 2 interior architects. The Jollowing proJessional organizations are included in the architecture group: _ AEC Swiss AssociationJor Construction Economics A & KFachverein Architektur und Kultur _ BSLA Bund Schweizer LandschaJtsarchitekten und -crchitektinnen _ FEB FachgruppeJiir die Erhaltung von Bauwerken _ FIB FachgruppeJiir Integrales Planenund Bauen _ FSU Fachverband Schweizer Raumplanerlnnen _ VSLASAI. Vereinigung Schweizer Innenurchitektenjcrchirektinnen
billion in 2005. To make this comparison possible, the
Source: www.sia.ch.
ing, because the architecture market is another branch that consists of many micro-enterprises. 95% of all workplaces in this industry employ fewer than ten persons and belong to the micro-enterprise category - making the Swiss architecture market an example of how micro-enterprises can attain a stable value-added effect.
INTERNATIONAL: THE ARCHITECTURE MARKET IN SWITZERLAND AND GERMANY Finally, a brief comparison with the German architecture market shows that, in the largest group of general architects, according to the German office of statistics,
try, and earth, water, and air. Its roughly
15 000
only architects included in the statistics were those that fit Swiss criteria, namely, those who produced an annual
BSLA BUND SCHWEIZER LANDSCHAFTSARCHITEK-
turnover ofat least CHF 75 000.
TEN UND LANDSCHAFTSARCHITEKTINNEN
The group of Swiss general architects produced a total of CHF 7.83 billion with only
(Swiss society ofprofessional landscape architects)
482 bureaus and
The BSLA is an alliance of Swiss landscape architects
thus turnover almost as high as· their German col-
who specialize in planning. The BSLA has approx. 350
leagues; moreover, in 2005, the Swiss general archi-
members.
tects' turnover was only about CHF 0.56 billion below
Source: www.bsla.ch.
II
the German total turnover. In sum, the Swiss architecture market is a notably
BSA BUND SCHWEIZER ARCHITEKTEN
economically significant market potential within the
(Federation of Swiss architects)
Swiss creative industries. Overall, the Swiss architec-
The BSAis an association ofarchitects who specialize in
ture market is one ofthe few industries in Europe that is
urban planning and spatial planning. The BSA has
actually growing, whereas in other countries, a steady
approx. 730 regular members and approx.
declined has been observed.
ated members.
IOO
associ-
Source. www.architekten-bsa.ch.
"'
0)
VSI EEREINIGUNG SCHWEIZER INNENARCHITEK-
As the key data chart shows, the number of
TEN/ARCHITEKTINN EN
bureaus in the advertising industry (excluding advertis-
(Association ofSwiss interior architects and architects)
ing design) was 395 in 2005, indicating that the number
The VSI.ASAI. considers itself an alliance of architects
increased somewhat from 2001 after a slight slump that
who specialize in designing and planning interior
continued until 2003. There is a substantial turnover
space. The VSI reports over 160 active members, in addi-
volume credited to the relatively small number ofenter-
tion to a larger number of young members, associated
prises. In 2005, fewer than 400 advertising enterprises
members, honorable members, sponsor members, and
generated CHF 4.4 billion - a statistical turnover of
free members.
CHF 11.1 million per enterprise. Between 2004 and 2005,
Source; www.vsi-asai.ch.
the total advertising turnover increased 2%. Despite the
3.3.HI THE ADVERTISING INDUSTRY The advertising
unable to regain its turnover highpoint ofCHF 5.15 bil-
upward trend since 2004, the sub-market was still industry comprises all economic activities related to
lion in 2001. Most ofthe CHF 3.62 billion total turnover
advertising products, services, or other concepts. Its
is generated at the standard VAT rate of 7.6%, while
relationship to the mass media makes the advertising
exports ofCHF 506 million, or 12%, only played a small
industry itselfa cross-sectional branch with a variety of
role. The other types of turnover (small enterprises,
facets.
reduced VAT and tax-free) did not generate significant
The advertising industry has been introduced to
shares in the advertising industry as a whole.
the creative industries in Switzerland as an additional
The Swiss Business Census shows that, because of
sub-market. It can be categorized together with the
the unfavorable economic trend between 2001 and 2005,
design industry as a related market in the broad sense,
the advertising branch suffered a considerable loss in the
and has also been placed by the General Classification
number ofworkplaces. 14.6% of the advertising indus-
ofEconomic Activities in both the "advertising design"
try's workplaces disappeared within the four years. Yet
and "advertising communication" categories. Since the
the worsening economic situation did not seem to have a
"advertising design" branch has already been included
negative impact employment potential. The number of
in the design industry sub-market due to its visual design bureaus, this section will deal with "advertising
employees even increased somewhat between 2001 and
communication," the second business branch of the
2005 from 9 575 to 9 647. Next to the radio industry, the advertising market demonstrates the greatest deviation
advertising market.
from the creative market's characteristic cluster struc-
This somewhat complicated division ofeconomic branches is not yet satisfactory, yet the future Europe-
ture. 20% of the advertising enterprises employed at least ten persons per enterprise unit. The statistical aver-
wide version of the classification of business activities
age of employed persons per unit is almost 20%, which
will facilitate a much-improved categorization of the
is very high compared with other levels in the creative
individual business activities.
industries as a whole. Nonetheless, there are still oneperson enterprises in this sector. 35% of the workplaces consist ofone to two employees at most.
'" 00
ENTERPRISES 28S1-2885 (VAT STATISTICS)
Companies Number
10° 3
Number 3005
4-l'ear change in "10 3005/01
376
373
381
395
2.1
CIlFmillion 3001
CIl Fmillion 3003
CHF miliion 2003
CIl F million 2004
CHF miliion 2005
4-year change in "10 3005/01
r-yearchange in 'lb 20041°3
in 'lb 2005/04
515°
47°9
4 146
4 299
43 84
-14·9
3-7
2.0
ADVERTISING INDUSTRY TOTAL
TOTAL TURNOVER 2S81-2S85 (VAT STATISTICS)
Number
100 1
387
Total turnover
ADVERTISING INDUSTRY TOTAL
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2885 (VAT STATISTICS)
Total of which Turnover of small
turnover
CHF million
enterprises
ADVERTISING INDUSTRY TOTAL
4 38 4
WORKPLACES AND EMPLOYMENT 2881 UNO 2885 (SWISS BUSINESS CENSUS) ADVERTISING INDUSTRY TOTAL
Workplaces Number 2001
Number 3005
588
5°2
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2885 (SWISS BUSINESS CENSUS)
workplaces
22
Turnover
Tu rnover at
CHF million Share in 'lb 2005
2005
ADVERTISING I NDUSTRY TOTAL
r-yearchange
Number 300
Number 3003
reduced VAT rare CIIFmillion Share in'lb 2005
75
°
at normal
2
- 14.6
9 575
ofwhich, workplaces with... employees" 1- 2 2- 5 Number Share in 'lbof all Share in 'lbofall workplaces workplaces 2005
Tax-exempt turnover CIlF miliion Share in "10 2005
12
II6 _ _ 3
turn over
3 616
Persons employed bl 4-yearchange in Cfo Number 3001 2005/01
CHF million Share in 'lb 2005
Export
Vf ratt
CIIFmill ion Share 20°5 in'lb
82
5°6
Number 3005
4-year change in "10 3005/01
9 647
0.8
(l
5°2
35
5 - tO Share in 'lbof all workplaces
Share in 'lbofall workplaces
16
20
3°
CHART 20_ KEY DATA ON THE ADVERT ISI NG (ADVERT ISING AGENC I ES) I N D UST RY .
Notes: Advertising industry = business branch advertising agency ., individual business branches assigned to different sub-markets; blfull_and parr-time employees; <'n ot including enterprises in the non-market business sector; dlfull-time equivalent . Sources: VAT Statistics, ITA; Swiss Business Census, SFSO; Creative Industries Research Unit I zHdK; own calculation.
ro and more
PORTRAIT: ADVERTISING EXPENDITURE IN SWITZERLAND
fairs and exhibitions, and address books generated higher turnovers than the previous year. While net
CHF 5 632 billion was invested in advertising in 2006,
advertising turnovers for cinema stagnated, a decline
according to data provided by the Stiftung Werbestatis-
compared to 2005 was reported in teletext and radio
tik Schweiz (the Swiss foundation for advertising statis-
turnovers. This data was obtained in written form
tics). This figure represents an increase of 3.3 % com-
directly from media surveys. They report the amount
pared to the previous year. The categories of outdoor
that advertisers effectively spend on distributing their
advertising, print, television, direct advertising, trade
advertising activities.
in CHF million (rou nded !
Net ad ve rt is ing turnovers (ex clud ing production costs)
2 00) ' 004 __-----'-'_ _..:. ' 0,-,0..:. ' _-----'2:..:. 0'-' 02:... __ -----'-'- _-----'--'--'-
Net advertising turnovers Switzerland
5665
Press
2886
1000
20 0 0
Daily media/regional week ly med ia/Sunday med ia
2000
Publi c media/financial and bu s iness media
3000
Special med ia
4000
Trade medi a
Electronic media
711
Television (incl. sponsoring)
533
Rad io (excl. spo ns o ring )
12 7
Cinema Teletext Other media
2102
2 300
External adve rt ising
559
Address books Trade fairs and exhi bitio ns
2 35
24 3
Dire ct advertising Gross advertising turnovers Switzerland
52
l nrerner
Adscreen
9
not comparable with the previous year due to new media typology as of 2002. not comparable with the previous year because consultant commissions are not included in the turnover produced by the official networks until 2001. ) not comparable with the previous year because turnover reports are not available from every source. 4 not comparable with the previous year due to a different basis ofcollecting data. I
2
Source: Stiftung Werbestatistik Schweiz (the Swiss foundation for advertising statistics), WerbeaufWand Schweiz (advertising expenditure in Switzerland), 2007.
CD CD
12
In line
industry, but actually a decrease between 2001and 2005.
with the British creative industries, the software and
The rate ofemployment dropped from 56 763 persons in
games industry is a core market in the creative industries that focuses on the production and reproduction of
2001 to 53 744 in 2005, which is a rate of-5.3%. More than 50%, or approx. CHF 10.6billion, ofthe
software and computer and video games. It is not yet
total games industry turnover is credited to national
3.3.11 THE SOFTWARE AND GAMES INDUSTRY
possible, however, to select an adequate business cate-
sales. Yeta substantial CHF 9.8 billion are generated by
gory for these production activities from the general
exports. Despite the very high total turnover, the games
classification ofbusiness activities. For this reason, this
industry is marked by a broad distribution of micro-
section will borrow the British concept ofthe "software
enterprises. 58% are among the smallest micro-enter-
houses" business group, which, as a core branch for the
prises with one to two employees. 91%ofthe enterprises
games industry, specializes in publishing software and
employ a maximum often persons per unit. The remain-
in software consulting and development. Incidentally,
ing 9% work in larger enterprises for which the term
this category is also based on the agreement on the cur-
"industry" is far more appropriate.
rentlyvalid OECD (Organization for Economic Co-operation and Development) concept." Nevertheless, it is important to note that the software production sector comprises a much larger spectrum. In addition to producing software for games, their main activity is publishing software for office use. Consequently the following conclusions can only be considered as provisional references. As seen in the key data chart, the number of software and games industry enterprises amounted to over II
000 units in 2005. This number increased steadily at
a rate OflO%between 2001and 2005. The total turnover volume increased 42% from CHF IS billion in 2001 to CHF 21.4 billion in 2005. This growth of almost CHF 6 billion occurred largely in the last year ofthe survey. It can also be assumed here that a reclassification ofVAT statistics [SEE CHAPTER 3.3.1] is responsible for this change, and not an actual market shift. This assumption is confirmed by data from the Swiss Business Census. According to this, there was no real increase in workplaces in the software and games 5.
OECD: The Online Computer and Video Game Industry. Working Paper DSTI/ICCP/IE (2004) 131FINAL 12. May 2005.
co '"
ENTERPRISES 2SS1-2SSS (VAT STATISTICS) SOFTWARE AND GAMES INDUSTRY TOTAL
TOTAL TURNOVER 2SS1-2SSS (VAT STATISTICS) SOFTWARE AND GAMES I NDUSTRY TOTAL
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2SSS (VAT STATISTICS)
Companies Number 1001
Number 1003
Number 1004
100 39
1062 3
10 766
10 963
CHFmillion 1001
CHFmillion 1001
CHFmillion 100 3
CHFmillion 1004
CHFmillion 1005
in "" 1005 /01
in "" 1004/0 3
in"" 1005 /04
013
9·7
1.8%
0·5%
1005 /0 1
in "" 1004/03
1005 /04
15 003
16 411
15334
15 075
21 390
4 2.6
-1·7
4 1.9
II
Tot. l turnover
r-year c hange
4-year change in ""
in ""
ofwh ich Turnover of
small en terprises CHFmillion Share 1005 in ""
SOFTWARE AND GAMES INDUSTRY TOTAL
21 390
644
WORKPLACES AND EMPLOYMENT 2SS1 UND 2SSS (SWISS BUSINESS CENSUS) SOFTWARE AND GAMES INDUSTRY TOTAL
w orkplaces
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2SSS (SWISS BUSINESS CENSUS)
Workp lac<s"
Turnover at red uced VATr:lte CIIF millio n Share 1005 in""
Turnover at normal VT rate CIIFmill ion Share 2005 in ""
0
10611 ~
3
9
4-year cha nge
Person employed "
CHFmillion Sha re 1005 in""
46
9 8 74
4-yea r change
Number 1005
in"" 1005 /01
Number 1001
Number 1005
1005 /0 1
100 92
9 669
-4.2
56763
53744
-5·3
in ""
ofwhich . workplac<s with .., emp loyees·'
Number 100 5
1-1 Share in "" ofall workplaces
1 5 Share in "" ofall workplaces
5 - 10 Share in "" ofall workplaces
Share in "" ofall workplace
9 666
58
23
9
9
NOles : " in divi dua l bu siness branches as sig ned to differen t su b-ma rke rs. " full- a nd part-time e mployees ; incl ud in g enterprises in th e non-marker bu sines s secron " full-t im e equivalent. Sou rces: VAT Sta t is t ics. FTA ; Swi ss Business Cen sus. SF SO ; Cre at ive Ind u st r ies Rese arch Unit / zudx, own calculation,
Tax-exempt
Export turnover
Number 1001
CHART 21_ KEY DATA ON THE SOFIWA RE AND GAMES INDUSTRY,
Number 1005
Total tu move r
CHF million 1005
SOFTWARE AND GAMES INDUSTRY TOTAL
r-yearchange
4-year change
Number 1001
I03nd more
turnover CHFmillion Share 100 5 in ""
201
PORTRAIT: THE SOFTWARE SECTOR
Extractfrom: Die volkswirtschaftliche Bedeutung des selbstdndigen Software-Sektors. Studie imAuftrag der ICT Switzerland [The National Economic Significance of Independent Software Sector, commissioned by ICT (Information and Communication Technology) Switzerland] byDr. Pascal Sieber & Partners AG Bern, in collaboration with the Universities of Berne and Lausanne (2004). (www.ictswitzerland.ch)
gramming services. The entire ICT sector (including telecommunications) has a total turnover ofCHF 25 billion. The significance of the independent software sector becomes evident when observing the consequences of an under-funded sector - it grows more slowly than othersectors, resulting in great damage. Every missing Swissfranc in the software sector represents an actual loss ofCHF 2.3." ,
"Most ofthe 11 329 independent Swiss software companies are small and locally active, with most of their 63 401 employees working in sojnuore development and consulting. The independent Swiss software sector' specializes [argely in converting foreign standard software for local use. Only regarding application software arenationalmanufacturers as important as the international ones. Sojiware companies pay wages that are higher than average, yet women still benefit less than men, and do not command top earnings either. The software sector trains fewer
apprentices thanaverage, despite thefact that most managers complain aboutthe lack of qualified personnel. The growing independent sojiware sector is an importantdrivingforce in theSwiss economy. It contributes approximately onefifth of the gross value-added, which is as much as thefinancial sector. Information technology services' is one of Switzerland's 43 business sectors. It uses few services provided by other sectors, yetthesector itselfis very tightly knit. Conversely, other sectors purchase a total ofCHF 13-4 billion in services provided by theinjormution technology sector. The public administration sector (where outsourcing plays a large role) is the largest consumer, having invested a good CHF 1 billion, followed by the telecommunications (which includes telephone services) withCHF 800 million. Thefinancial sector, however, produces much of its own computer pro-
1
All Swiss enterprises that manufacture, refine, distribute, implement, or otherwise utilize software. This does not include IT departments in banks. for instance. Information technology services include the data processing and data banks business sector established by the Swiss Federal Statistical Office. The software sector is a sub-sector of this.
3.3.12 HANDICRAFTS Handicrafts are included in the
is also evident that there is a relatively high share of
creative industries in Switzerland as a supplementary
exports, namely 34%, or CHF 380 million. The share of
sub-market. It can be situated within the art market or
small enterprises in the total turnover is 10%. These
within the design industry context. According to the
again are credited to the jewelry, gold, and silver prod-
General Classification of Economic Activities, handi-
uct designers.
crafts comprise at least three business categories. These
The data from the Swiss Business Census by the
include "precious and gemstone artisans," "jewelry,
Swiss Federal Statistical Office (SFSO) also show a
gold, and silver product designers," and "other ceramic
downward trend in the handicrafts industry. Approxi-
products manufacturers."
mately 925 workplaces remained in 2005, after drop-
The key data chart shows that the number ofhand i-
ping II.3% from 2001. The rate ofemployment dropped
craft studios in the four-year survey period of 2001 and
even more drastically. From the more than 4 000 jobs in
2005 fluctuated between 872 and 854 units. Jewelry,
2001, only 3100 remained in 2005. This is a rate of
gold, and silver product designers comprised the largest
minus 22% over the four-year period.
group, with 770 enterprises. The two smaller business
Handicraft enterprises have traditionally belonged
branches, the precious and gemstone artisans and the
to the micro-enterprise category, a fact confirmed by the
ceramic workshops amount to 88 enterprises.
given statistics. Approximately 63% of all workplaces
The handicraft sector's total turnover was CHF I.I
employ more than one or two employees. 96% of the
billion in 2005. CHF 744 million, or one fourth, is again
enterprises employ up to ten persons and are allocated
credited to the jewelry, gold, and silver product design-
to the micro-enterprise category. Nevertheless, there is
ers. The other fourth, CHF 357 million was produced by
a notably high percentage of large workplaces in the
the precious and gemstone artisans within the same
precious and gemstone sector. 13% of these employ
time frame. The ceramic sector, with CHF 9 million,
more than ten persons per unit.
generated only a marginal percentage ofturnover in the same period. The overall development of turnover was influenced by the largest business branch, the jewelry, gold, and silver product designers. After a turnover high of CHF 909 million in 2001, turnover dropped to CHF 750 million, or a loss of 18.1%, in the four-year period. Despite the positive developments of both other business branches, the total turnover remained negative for the handicrafts sector, which lost approximately 8% in turnover over the survey period. Looking at the
breakdown of the types of turnover reveals that the largest share was generated at the standard tax rate. It
N
'"
ENTERPRISES 2SS1- 2SS5 (VA T STATISTICS) HANDI CRAFTS Precious stone and gemstone artisans Jewelry, gold , and silver product designers Other ceramic products manufacturers
Com panies
Number
Numbe r
Number 2002 _ _-==_ _...=: 2 00~ 1 _ _..:.::= 200 3
Number
__---"=c 1004 _ _---== 2005 "-
872 - - - :8""" 6
86 4 8.<. 7 _ _~'-
88 ._ _.....,...,..
779 _ _ _~ 7
77 0 7
777 --"C. 5
6
_
1208
Jewelry, gold , and silver product designers
BREAKDOWN OF THE DIFFEREN T TURNOVER TYPES 2SS5 (VAT STATISTICS)
Precious stone and gemstone artisans Jewelry, gold , a n d s ilve r product designers Other ceram ic products manufacturers
WORKP LACES AND EMPLOYMENT 2SS1 AND 2SS5 (SWISS BUSINESS CENSUS)
HANDI CRAFTS
r-year cha nge
in % 2005/01
1005
.2.00;
1 012 1110 101 2 10 7 2 --------'----------
9 09 _ _ _~ 7
--'--'274 _ _
~ ~ c
79 1 -'-. 7
734 ,7
- 8.1 22.2 - 18.1
_ _---"'_=_ 57
744 -'- ._ _~ 9
9.6 - 5.8
- 5·5
- 20.8 18.8 ____ 1."'-.5 _ _~"--
Total
ofwhich
turno ver
Tu rnO\~rof sm. II enterprises CHF million Share _ _ _~2°O=-5 in %
Expon - Turnover at Turnover reduced at normal turnover Tax-exempt VATrat. CIIF milVTra l. turnover CIIF million Share CHF millio n Sha re lio n Sha re CIIF million Share 2005 i n% ~ in% _ _----'=.L 2005 in% 2005 in %
=:.>. o
0
o
o o o
1110
III
357 744 9
6 105
14
_o
o
o
- - - -o 4· ye.r change
workpla ces
Number
Number
2001
2005
1 043
9 25 82
Precious stone and gemstone artisans
79 95 2 12
Jewelry, gold, and silver product designers Other ceramic products manufacturers
WORKPLACES ACCORDING TO LEVEL S OF EMPLOYMEN T 2SS5 (SWISS BUSINESS CENSUS)
1003
2 2 _ _----'27 2
CIIF million 2005
HANDIC RAFTS
1002
- 1.8 - 6.8 - 1.4 20.0
- 1·7 - 14·3
6
4·)··.. ch.ng.
100 1
Precious stone and gemstone artisans Other ceramic products manufacturers
2005 /01
CIIF millio n CIIF million CIIF million CIIF millio n CIIF mill ion
HANDICRAFTS
in% in % 2005/0:\ 2004/03 _----'=..c.:;1.
in %
-2.1
Total tumover
TOTAL TURNOVER 2SS1 -2SS5 ( VAT STATISTICS)
I·)~.r cha ng.
4·y. ar ch. ngc
Number
Workpl. ces
83 7 6
---,-- - - - - - - - -----,6..,. 0"'5-. 55 ~ 34 _6 165
~
185
52
412
55
~~
8 -2i
6
ofwh ich. workplaces with ... empIO)'CCS "
_2
_o
4· yea r change
in % 2005/01
Number
2001
1005
in % 2005/01
-11 ·3 3. 8 -1 2.1 -5 0. 0
4 062 934 3 102 26
3 183 644 25 25 14
- 21.6 - 1.0 - 18.6 - 46.2
of which . workplac es with ... employees" 1-2 2 -5 hare in % ofall Share in % of' a ll workplaces wo rkplaces _ _.....:.:===c
Numb<:r
5 - '0 Share in % of'all wo rkplaces
rc and mo re
Shore in %of.1I workplac. s
====.::..__ .....:.:===c
HANDICRAFTS
7
Precious stone and gemstone artisans
9
4 13
7
4
Jewelry, gold, a n d silver product designers Other ceramic p roducts manufactu rers
6 _ _ _---'6:..<.... 7
CHART 22_ KEY DATA ON THE HANDICRAITS INDUSTRY. Notes : ' J individual business branches assig ned to different sub-rnarketsr " full- a nd pan-time em ployees;
<, nOIincluding enterp rises in the non-marker business secto r: d'full-time equ ivalent. ources: VAT Statistics. FTA; Swiss Business Census , SFSO; Creative Industries Res earch Uni ll ZltdK; own calcul ation.
~'-L B
~ o
o
-"'-5
o=-
o
3.3.13 THE PRESS INDUSTRY The press industry is
the four-year period. In contrast, the other three groups
also considered an additional sub-market in the Swiss
showed extremely positive developments in turnover,
creative industries. It is related to the business branches
skyrocketing 25 to 44% between 2001 and 2005 in the
that are often allocated to the book market in the broad
retail trade, the group of other publishers, and the
sense. The individual branches include: newspaper and
translation bureaus. In general, all business branches
magazine publishers and other publishing firms, retail
are pointing to positive sales trends, even if this is still
trade in newspapers, magazines, and so on, and trans-
somewhat reserved in the newspaper publishing
lation bureaus.
group.
As the key data chart shows, the number ofenter-
Differentiating between the types of turnover
prises in the press industry totaled 2,309 in 2005 - the
shows that the highest share ofturnover ofCHF 4.8 bil-
largest group being the "newspaper, magazine, and
lion, namely 59%, is generated at the standard VAT rate,
kiosk retail trade" with just under 990 enterprises. This
whereas sales at the reduced rate amounted to only
is followed by the "translation bureaus" with 484 and
CHF 2.6 billion, or 30%. A notable share of exports is
the "magazine publishers" with 422. "Newspaper pub-
accredited to the magazine publishing group with
lishers" and "other publishers" amounted to 232 and
approx. CHF 250 million (or a share Of14% of the total
182 enterprises, respectively. The number grew in all of
turnover). The share ofturnover earned by small enter-
the business branches between 2001 and 2005. During
prises is only 5%, which is relatively low in comparison.
the four-year period, the number ofprofessionals in the
Yet again, the retail trade group and the translation
press industry increased 10%.An even stronger growth
bureau group with n% and 23%, respectively, are very
can be observed in the clustered business branches,
strong here.
such as retail trade or the translation bureaus, yet the
However, the Swiss Business Census by the Swiss
publishing branch also displays a growth rate of 2 to
Federal Statistical Office (SFSO) shows that the press
6.6%.
industry is experiencing an overall decline, as are most
The total turnover generated by the press industry
other sub-markets. The number ofworkplaces decreased
reached a high ofCHF 8.2 billion in 2005. CHF 3 billion
7% from 4175 in 2001to 3846 in 2005. This was accompanied by a drastic loss in personnel. Approximately
are credited to the retail trade branch, CHF 2.9 billion to the newspaper publishers, and CHF 1.8 billion to maga-
10% of the jobs in the press industry were lost during
zine publishers. Approximately CHF 300 million was
this period, in particular in retail trade and the press
produced by the group ofother publishers, and approx.
publishing group. The group of other publishers and
CHF 200 million by the translation bureaus. However,
the translation agencies, in contrast, were able to
this sub-market's total turnover did not develop as pos-
expand their rate of employment. Their rate of growth
itivelyas other business developments.
amounted to 34 and 28%, respectively.
The two groups ofmedia publishers were respon-
The press industry is dominated by micro-enter-
sible for the 0.3% stagnation between 2001 and 2005.
prises. 95% of the workplaces employ ten persons or
They suffered losses of14.7and 12.4%, respectively,over
fewer. The cluster structure is particularly concentrated
Companies
ENTERPRISES 2881-2885 ( VAT STATISTICS)
2 001
PRESS INDUSTRY Newspaper, magazine, kiosk retail trade Newspaper publishers Magazine publishers Other publishers Translation age ncies
2 100 89 6 227 39 6 144 437
Num ber 2003
Number
21 4 8 9 16 229
2 15 6 89 8 23 1
395 149 459
4°1 157 4 69
2 239 94 1 226 4 24
2004
173 475
Number 2005
in% 200 5101
in% 2004 103
in% 2005104
2 3°9 989 232 4 22 182 4 84
10.0
3. 8 4. 8 -2.2 5·7 10.2
3. 1 5. 1 2·7 - 0·5 5. 2
1.3
1·9
10·4 2.2 6.6 26·4 10.8
r-year change
4-year change
CHF mill ion CHF millio n CHF million CHF million CHF million 2.00 1 .10 0.1 2 004 200 3 2005
PRESS I NDUSTRY Newspaper, magazine, kiosk retail trade Newspaper publishers Magazine publishers Other publishers Translation agencies
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2885 (VAT STATISTICS)
Number 2002
Totalturnover
TOTAL TURNOVER 2881 -2885 (VAT STATISTICS)
r-year change
4·year change
Number
821 5 244 2 3400 201 3 206
79 62 266 3 3 026 19 20 201
153
154
7 658 27°4 2862 1680 240 172
82 36 3 °7 0 28 99 17 63 297 2°7
8 ° 71 3°22 28 9 6 1684 273 196
in % 2005/01
in % 2004/ 03
in % 2005104
0·3 25·7 - 14·7 -12·4 43·9 35·3
5·4 11 .8 1.2
2.0 1.6 0.1
0·3 13.8 14.1
4·7 8.8 5. 1
Total turnover
ofwhich
Turnover at Turnover Export Turnover of sma ll reduced at nor mal turnover Tax-exempt enterprises VAT rate VT rate CIl F milturnover CHF CHF mill ion Share CHF million Share CIIF millio n Share lion Share CHF million Share millio n _ _---'2 : :.;: oo o=..L. 5 in % _ _ ......=. 2o::.: 0~ 5 in % 2005 in % ~ in % _ _ -= 200 o=..L. in % 20°5 5
PRESS I NDUSTRY Newspaper, magazine, kiosk retail trade Newsp aper publishers Magazine publishers Other publishers Translation agencies
82 36 _ __ 4:-1_8 _ _ 5 3.:7 II 3 07° _ _--=3"' 28 99 _ _ _.....:... 7 0 1 7 6 3 _ __ ---' 17:8 __ 3 297 _ _ _---,-20 7 _ _----'4'-'8 --.21.
WORKPLACES AND EMPLOYMENT 2881 AND 2885 (SWISS BUSINESS CENSUS)
Workplaces Numbe r 2001
PRESS INDUSTRY Newspaper, magazine, kiosk retail trade Newspaper publishers Magazine pu blishers Other publishers Translation agencies
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2885 (SWISS BUSINESS CENSUS)
PRESS I NDUSTRY Newspaper, magazine, kiosk retai l trade Newspaper publishers Magazine publishers Other publishers Translation agencies
4 175 2799 3 14 389 128 545
Workplaces
Number 2005
2-,,5-=-03 ,,- --E 980 --E. 926 32 53 2 30 63 21 -"3 ~
4·year change in % 2005/01
3 846 24 87 29 6 359 159 545
ofwhich . workplaces with ' " employees '" Num ber Num ber 2001 2005
-7·9 -11.1
26 394 10 954
- 5·7 - 7·7 24.2 0.0
9599 4 097 787
Share in % ofall work places
957
23 646 974 2 7 9 17 3704 10 58 122 5
---'--'<73
19 ~:18_ ~ 35 o_ _
4·year change in % 2005/01
-10·4 -11.1 -17·5 - 9·6 34·4 28.0
- - - - - - ------,--I O .1n d more
2 -5 5 - 10 Share in % ofall Share in % of all workp laces _ _ workplaces
Share in % ofall
6
5
4 21 12 13 2
29 17 10 2
59 61 2 95
4 845 59 ~ __5 1 68 4 ----TI.. -------.12. __2 1895 65 ----...£. __2 9 24 52 ~---21... 201 68 _ _2_4__8 141 68 _ _ 1_3_ _ 6
ofwhich. workplaces with .._employees '" 1- 2
Number 200 5
------co:-- - - - - - - - - - - -
24
159 54 0
CHART 2L KEY DATA ON THE PRESS I N D UST RY.
Notes: · j individual business branches assigned to different s ub-ma rkets : .) full- and part- time employees: " no t includ ing enterprises in the non- market business sector: dJ full-time equivalent. Sources: zudx Statistics, FTA: Swiss Business Census. SFSO: Creative Industries Research Unit I zudx, own calculation.
workp laces ---"'="""""'" _ _ --"==~
2
o
PORTRAIT: THE MEDIA INDUSTRY AC CORDING TO PUBLICATIO NS AND PUBLISHING HOUSES
The fifteen largest dail y newspapers in Switzerland: Publication
Publisher
20 Minute n , )..1 ) (German )
20 Minuten (Schweiz) AG
2
Blick
Ringier AG
3 4
Tages-Anzeiger Mirrelland Zeitung Berner Zeitung bl . d
Tamedia AG
Neue Zurcher Zeitung AG
7 8
Neue Ziircher Zeitung Die Sudostschweiz'" LeMatin bleu a)
9
Neue Luzern er Zeitung
5 6
Zurcher Land zeirung" St. Galler Tagblatt 12 Basler Zeitung " 13 24 heures 14 LeMarin sernaine IS Tribune de Geneve 16 Der Bund h) 10
II
Aargauer Zeitun g AG
Espace Media Group e Sudostschweiz Presse AG
Edipresse Publications SA Neue Luzerner Zeitung AG ZOri ch Land Medien AG St. Galler Tagblatt AG Nationa l Zeitung und Basler Nachrichten AG Edipresse Publications SA Edipresse Publications SA La Tribune de Geneve SA Del'Bund Verlag AG
Circulatio n
Reade rs hip
4 19 684 254 657 225 287 210 358
1 17°
15759° 146 7 29
395 308
139 802 134 500
243
131° ° 4 I0993 J 103 °77
694 534 435
3°9 318 221 214
98 645 953 15 76 194
2° 4 24 2 3 21
67 151 58 590
169
Not es;
" Free newspapers (published Mo- Fr) h) Bernet Zeirung: numbers incl. readership ofDer Bund " not wFM r-aecredited, publishing house data "; inc!.Liechtensteiner Vaterlaud and Liechtensteiner Volksblatr " enoperation with rhe Zurcher Landzeirungen. Der Zurcher Oberlander. Zurcher Unterlander incl. Bulacher Tagblarrand Zurichsee-Zeirungensince Septe m ber 2 00 6 Sou rces : WEM F circulation bulletin 20 06 (Bas is : ave rage circulation 1.7 .200 6 - 30. 6. 2006), " tACH Basic 1.007!1
Swiss Press Association, March 2007.
The largest publishing hou ses according to turnover 2005: Publisher
2 3 4
5 6 7 8
- -
Ringler AG Edipresse Publications SA,,' 'Iamcdia AG NZZ Gruppe Basler Mediengrup pc"
Espace Media Groupe AZ Medlen Gruppe LZMedlen AG'I
10
Sudos tschweiz Mediengruppe Jean Frey AGc)
tI
Vcgt-Schildrltabegger Medien AG
12
Zurichsee Medien Das Beste d)
9
13
Em ployees
200 5
Chan ge in tu rnove r 04105
r 256.3
12.8
67,1
5,30
6081
894,4 65° . 0 4 82 ,3 "
5·9 14·7 -u .8
37·5 79·7 13.6 ' )
4. 20 18,5°
3 636 15 18
276,2
-5 .2 ° 04 6.0
3·7° 0.98 8.13 4,7 0
1737 2 02 3
261.9
2·7 21.3 8.2
475 8 25
Tu rnover
195,8 134,2
Net profi t
8,1
11.8
8.80
124,0
0.2
93.2 n.p.
- 3-3
2,9 6,6
2.40 7. 10
n.p.
n. p.
n.p.
55. 2 approx. uo.o
- 3.0 n.p .
n.p,
n.p.
n.p,
n.p.
Notes : ;II
I FR S
basis
oi business year ends June 30. <; 20 04 for the first rime consolidated entirelywith the N ZZ group ", rhe American SarbanesOxleyAct prohibits releasing these figures, n.p.. not published. Source: Media Trend Journal 6, 2006, Top Med ienunrernehmen Schweiz (business report. research MT)).
Swis s Pre ss Associat io n, June 2006 .
Profit marg in
2004
890 5 20
3° 0 380 197 n.p,
in the retail trade segment and in the translation agen-
its market potential after an n% decline in workplaces
cies. In contrast, the media publishers are traditionally
and a 15% decline in personnel. Yetlittle else could be
among the mid-size or large enterprises in the creative industries.
expected after the drastic decline in turnover. While audio production can boast a small number oflarge enterprises, most of the industry is dominated
The audio industry is
by the cluster structure. 94% of the workplaces have
included in the Swiss creative industries as a supplementary sub-market. It refers to the business branches
fewer than IO employees per unit. The detailed analysis of the 13 sub-markets pro-
that are often assigned to the music, film, and radio
vides a comprehensive and heterogeneous description
sub-markets in the broad sense. The audio industry
of the creative industries. The following chapter will
comprises the following business branches: "radio, tele-
expand upon the perspective based on the empirical-
vision, and audio equipment production" and the "retail trade."
quantitative analysis, and present Switzerland in the
3.3.14 THE AUDIO INDUSTRY
As the key data show, the audio industry reported 1,367 enterprises in 2005. Whereas audio production increased - the number ofenterprises rose 20% between 2001 and 2005 - the retail trade branch declined 8.1%
over the same period. Both lines ofdevelopment continued between 2004 and 2005. The total turnover generated in 2005 by the audio industry was CHF 2.3 billion. This is 8.5% less than 200I, a similar trend that can be observed in both busi-
ness branches. While the turnover in audio production dropped steadily, the retail trade situation improved, putting a halt to the overall negative trend. However,the development over the last years shows a slightly rising trend in turnover. Audio industry turnover were generated at the standard tax rate. However, 51% ofaudio production is for export. 8% of the turnover is generated by small enterprises. A shrinking process in workplaces and in the rate of employment can be clearly observed in the Swiss Business Census data provided by the Swiss Federal Statistical Office (SFSO). The audio industry lost much of
European context.
ENTREPRISES 2881- 2885 (VAT STATISTICS)
r-year change
Numb er 2001
Number 2002
Numbe r 200
Number 200
Number 2005
in% 2005/01
in % 2004/03
in% 200 /0
1455
1437
14 03
1397
13 67
-6.0
-0·4
- 2.1
104 135 1
108 1329
12 92
119 1 278
12 12 42
20.2 - 8.1
7. 2 - 1.1
5.0 -2.8
CIlFmillion 2001
CHFmillion 2002
CIlF million 2003
CIIF million 2004
CHF million 2005
in% 2005 /01
in % 2004/03
2559
26 4 0
23 65
23 81
234 1
-8·5
0·7
2 6 23 22
264 237 6
2 2 2 113
260 2 121
215 2 125
- 8. -8·5
2·9 0·4
AUDIO INDUSTRY . J Radio, television, and audio equipment production .J Retail trad e
TOTAL TURNOVER 2881- 2885 (VAT STATISTICS)
4-year cha nge
Companies
III
Total tumove r
AUDIO INDUSTRY .) Radio, television, and audio equ ipme nt pro duction .1 Retail trade
r-year change
4·year change
- 17·0 0.2
Tota l
BREAKDOWN OF THE DIFFERENT TURNOVER TYPES 2885 (VAT STATISTICS)
AUDIO INDUSTRY .) Radio, television , and audio equipment production .) Retail trade
WORKPLACES AND EMPLOYMENT 2881 AND 2885 (SWISS BUSINESS CENSUS)
ofwhich
turnover
CHF million 2005
small enterprises CHF million Share _ _ _.:;2oo:=.5 in %
215 212 5
AUDIO INDUSTRY .) Radio, television , and audio equipment production .1 Retail trade
186
8
7 178
8
Workp Ltc<s
Workplaces "
Turnover
reduced VAT rate CIlF million Share ::; 2oo :=. 5 in %
at normal Expo rt VI" rate turnover CHF million Share CHF million Share 2::;00~5 in % _ _---'2=.::00~5 in %
114 17 10
turnover
CHF million Share =~.....::.:..;;;" 2005 in %
0
2010
86
131
6
6
0
0
0 0
96 1 9 14
45 90
110 21
51
0 6
0 0
perso ns employed b.
a-year change
Number 2005
inCJo 200 /01
Numbe r 2001
Number 2005
in % 2005/0'
182 4
-11.0
974 0
82 91
- 14·9
114 1 7 10
0.0 - 11.7
10 51 868 9
817 7 474
- 22·3 - 14.0
ofwhic h, wor kplaces with... employees."
Number 2005
Tax-exempt
3
3
4-year cha nge
Number 2001
AUDIO INDUSTRY .J Radio, television, and audio equipment production .) Reta il trade
WORKPLACES ACCORDING TO LEVELS OF EMPLOYMENT 2885 (SWISS BUSINESS CENSUS)
Turnover at
Turnover of
' -2 Share in % ofall wor kplaces
2- 5 Share in % ofall workplaces
5 -'0 Share in % ofall workplac<s
ro and mort Share in % ofall workplaces
34
40
20
6
42 34
29 41
20
14 5
CHART 24_ KEY DATA ON TH E AUDIO INDUSTRY E NTE R P R ISE S. Not e :" ind ivid ual busi nes s branch es as igned to d ifferent su b-marke ts: b. full- a nd part-lime em ployees; " no l inclu di ng ente rp ri es in th e non -mar ket busin es s sec to r: ., fu ll-time equ ivalent. Sou rce: VAT Statis tics. FTA; Swis s Bus in ess Ce ns us, SFSO; Creati ve Ind ustries Research Unill ZHdK; own ca lcul at ion .
4.B SWITZERLAND EUROPEAN UNION
A discussion ofthe creative industries in Switzerland is impossible without considering the European aspect. The starting point for a comparison is the EUCommission's survey "The Economy of Culture," mentioned in Chapter
2.2.2.
This chapter describes some of this survey's findings in order to position Switzerland within the European framework. The first section explains Switzerland in the European context [4.1], and is followed by an additional portrait of the creative industries in Europe [4. 2] . 4.1 SWITZERLAND COMPARED TO EUROPE Compara-
tive analyses for Europe can refer to the research department of the French Ministry of Culture (Departernent des Etudes, de la Prospective et des Statistiques, DEPS) for Europe-wide studies. This work is representative of Eurostat, the Statistical Office of the European Commission, and is considered one of the few currently available sources of data on the cultural sector in Europe. The cultural sector is comprised of the economic groups presented in Chart 25, which are derived from the European business classification.
EU Co mm iss io n classification accor di ng to NACE, the offi cial Euro pea n business classific ati on system
lnclu ion in the cultural field
Nace a-digits
Naco 3 digits
22 - Publishing, printing and reproduction ofrecorded media
22.1- Publishing 22.2 - Printing and service activities related to printing 22.3 - Reproduction of recorded media 92.1 - Motion picture and video activities 92.2 - Radio and television activities 92.3 - Other entertainment activities 92.4 - News agency activities 92.5 - Library, archive, museums and other cultural activities 92.6 - Sporting activities 92.7 - Other recreational activities 74.1- Legal, accounting, bookkeeping and auditing activities; tax consultancy; market research and public opinion polling; business and management consulrancy: holdings 74.2 - Architectural and engineering activities and related technical consultancy 74.3 - Technical testing and analysis 74.4 - Advertising 74.5 - Labour recruitment and provision of personnel 74.6 -Tnvestigation and security activities
92 - Recreational, cultural and sporting activities
74 - Other business activities
Yes No No Yes Yes Yes Yes Yes No No
No Direct estimation ' ) No Yes No No
74.7 - Industrial clean ing
No
74.8 - Miscellaneous business activities not elsewhere classified
Yes
CHART 25_ STATISTICAL CLASSIFICATION OF THE CULTURAL SECTORS IN EUROPE.
=
Note: This system does not allow a precise analysis ofthe architecture market. NACE Rev. r Nomenclature sraristique des Activites economiques dans la Comrnunaute Europeenne" (General Industrial Classification ofEconomic Activities in the European Communities). Source: EU Commission. The Economy ofCulrure in Europe. Brussels 2006 according 10: EU cultural statisticsf Task Force Employment/EUROSTAT and the French Minislry ofCulrurelResearch Department DEPS.
Employment rates in the European cultural sec to rs 2004/2003 Actual number ofemployees, shares and chan ges in "10
EU States Germany United King dom France Italy Spain The Net herlands Poland
Percentage bl
number
of total
Change
number
absolute
in%
in %
in %
absolute
in %
in%
200 4
20 0 4
2 00 4
2 0 0 4 10 3
2 003
2003
2 003
957 000 8833 00 49 63 00
19·9
3. 2
- 2·5
9 8 170 0
3 2. 6
18·4
3. 8
-1.3
27·5
4 6.9 47 . 1
10·3
4 66900 379°00
9·7
2·5 2.8
5·3 0. 1
8945 00 47 1400
3. 1
13·3
4 66400 334400
4 .2
4 ·7
1.9 3. 6
2·9
29 6400 23 0 800
7·9 6.2
2·7
61.7
2·5
9·4 1.8
28 ·5
1.9
34. 0
1.7
3·3 6·5 3. 0
85 20 0 83 800
14·9
1.7 1.6
-5 ·4 -3.8
34·7 5 0. 1
-1.1
80000
3 8,4
47·4 33. 1
1.6
3-7
3·2
1.6
2·3
25·7
75 200 60600
17·8 21.8
4I.3 27. 1
1.0
3·4 3. 2
2·9
50 . 8
3-9
444 00 28000
26·4
0.6
7. 0
37. 6
0.6
2·3
- 6·5
3°9°0
5. 0
0.6
1.9 3. 6
- 5.6
17·3
5 8.3 3 2 .5
0·4 0.2
3. 6
- 1.6
3°40 0 2340 0 18 9 0 0
17·4 9. 1
5 2. 2
2·3
- 7. 1
84 00
0.1
2·4
3-3
3400 2800
23 ·3 16.2
0.1
2·9 7. 1
100.0
3. 1
1·4
474 2 200
Portugal
7 6 200
Ireland
457 00 29 100
Cyprus Luxembourg Malta EU-25 and Switzerland
28 700 18600 7 800 35°0 3 000 4807600
24 .8
1·9
Finland
Estonia
44·4 51.8
33-5
79100 77 600
Slowenia
29·9 20·4
935 00 855 0 0 87 80 0
Aus tria
Slovak ia
283000
34·7
0·5
80600
28 9 00 28 700
57 ·9
2.0
Hungary
Lithuania
21.9
100600
Denmark
Latvia
54·3
- 3.2
894 00 80600
Belgium
20·3 5 1.4
- 5· 7
94°° 0 935 00
Czech Republic
Percentage of self-employed
3. 2 3. 2
2.8
Switzerland
Cultu ral sector
2243° 0 1437 00
4 .8
135 5 00 97400
Sweden Greece
Percentage" with tertiary education
Percentage ofEU-25
Cultural sector "
2.0
0.6
22.6
18·3
43. 0 4 0. 6
41.5 64·5
11.1
39 ·4 27. 8
28·9
4 6•6
CHART 26_ EMPLOYMENT RATES I N THE EURO PEAN CULTURA L SECTOR.
Notes: For a definition of the cultural sector, see the statistical classifications of the cultural secror. " not including people employedin cultural tourism. ., share of employeesin the cultural sector including those in cultural rourism, thus % valueis 0.5% higher on average.Total share of the total employment in the respectivecountry in %; " higher education degree. The data are based on regular surveysbythe Research Department DEPS of the French Ministryof Culture. in collaboration with EUROSTAT/LFS . Employeesare comprised of self-employedpersons (freelanceand enterprises, part-time employment) and dependent employees(workers, permanent employees, civil servants, part-time employees). The definition of employeeis based on the LaborForceConcept; for Switzerlandon SLFS . Sources: EU Commission. The Economyof Culture in Europe, Brussels 2006; evaluation for Switzerland, Creative Industries Research Unit I ZHdK. own calculation.
=
This categorization is based on the business classifica-
Netherlands (4.2%), the UK and Finland (each 3.7%),
tion. It is a pragmatic procedure because the analysis
and Sweden, Slovakiaand Estonia (each 3.6%). The total
builds upon existing data. The data evaluated were pro-
distribution, in terms ofpercentage, ofcultural employ-
vided by the European Labor Force Survey, or collected
ees over all of the EU member states is relatively insig-
from national data; for Switzerland, from the Swiss
nificant. Cultural infrastructure is standard grass-roots
Labor Force Survey (SLFS).
infrastructure, available in all European countries.
In 2004, approximately 4.7 million people, or 2.6%
One ofthe most prominent features ofthe employ-
of the labor force in the 25 EU member states, were
ment landscape in the cultural sector is the relatively
employed in the cultural sector. Ifthe European cultural
high self-employed rate ofalmost 29%. The rate ofself-
tourism labor force is included, then the total of 5.9 mil-
employed as a whole in the EU in 2006 amounted to not
lion persons amounts to a comparable share of 3.1% of
more than 15%.
the total EUlabor force. According to the European classification, Switzer-
cultural sector, namely 46.6%, is a notable feature.
land has a labor force totaling 94 000 in the cultural
Compared to this, the rate of 24% in the labor force as a
sector. This includes both self-employed and dependent
whole is quite modest. Cultural and creative profession-
employees. Compared to the Swiss employment force of
als have been investing in their education for a long
201,000 in the creative industries as a whole, this defined
while. Chapter 5 addresses the issue of whether this
cultural sector is missing some sub-markets, such as
investment was actually worthwhile, or whether the
the software and games industry with a employment of
reality ofthe situation is in fact very different.
53 000, and the audio industry.
scale, is in the top third ofthe European countries. The
force naturally concentrates on the large, highly popu-
estimated percentage of the cultural workforce in the
lated member states. More than one third ofthose who
total workforce is 3.2%, just over the ED average. Still,
work in the cultural sector livein Germany or the United
however, this does not assure Switzerland a position
Kingdom. Add France to this figure and it becomes
among the leading countries, the UK or Scandinavia.
million people or 49% are employed in these three countries; yet this should not imply that potential is concentrated only here. Other countries come to the fore once the actual share of the cultural labor force is examined as a comparative figure, in relation to the total labor force in the respective country. The following countries represent the highest share of cultural employees in relation to their respective labor force as a whole, clearly surpassing the 3.1% EU average: Hungary [6.5%), the
N
The Swiss cultural sector, viewed on an absolute
The geographic distribution of the cultural labor
almosthalfofall the EU's entire cultural labor force. 2.3
.-< '"
The high percentage ofuniversity graduates in the
In a
tot al sa les volume of EUR 556 bill ion. This is equal to a n
broader a na lysis , th is chap ter exa m ines t he prese nt a-
est ima ted value-add ed pot ent ial of EUR 215 billion. The
tio n of th e Europea n creative indu stries. This system of
number ofemp loyees was approximately 6.4 million.
4 .2 THE EUROPEAN CREATIVE INDUSTRIES
clas sifica tio n was put tog ether follo wing th e EU Task Force on Cultural Em ployment [SEE CHAPTER
This was research ed by th e Creat ive Industries
4 .1 ]
Research Unit at the Zurich Univers ity of the Arts (zhd k)
us ing t he defini tion ofth e "creative indus tries" provided
in coll aboration with the EU Cultural Industri es
by t he UK Department for Culture, Media and Sports. It
rese arch group at the EU Directorat e-General for Educa-
includ es th e following bran ches accord ing to NACE-
tion a nd Culture in a n evalu ation of Europea n bran ches
Nos. 22.1, 22.3, 72.2, 74.4 , 74.8 as well as th e cultural
ofth e creative industries (EU-25).
gro ups NACE-Nos. 92.1 to 92.5. The dat a needed for thi s
If creative sub-branches a re included , such as
evaluation stem from the stru ct ura l business st atistics
adverti si ng a nd th e softwa re a nd ga mes ind ustry in th e
and th e Europea n Labor Force Sur vey provided by Euro -
bro ad se nse , the compar ative numbers increas e sig nifi-
stat. The dat a were prim aril y available in a two-digit, in-
cantly. 6.4 million self-employed a nd taxa ble enter-
depth clas sification a nd wer e est im ated for th e three-
prises in the creat ive industr ies gen erat ed a compa rable
dig it catego riza tion based on nation al res ults fro m Ger-
sa les volume of EUR 556 bill ion . The value-added poten-
man y, France, a nd th e UK.
tial increases to a volum e ofnearl y EUR 215 billion.
In 2002,57 the Europea n cultural indus try, with a
The str engt hs and weaknesses of the creati ve
steadily growing number of ent erprise un its - namel y
industries become clear when compared wi th selected
1394 162 freelance bure aus and enterprises - generated a
tr aditional indu stries.
in thousand s 7 000 6000
5000 4 000
3000 2000 1000
o Automobile industry
Creat ive industry
Energ)'
supply
FIGU RE 13- C R EATIVE I N DUST R I ES WO RK FO RC E ACCORD ING T O T HE EU-25 BRA NC H EVALU ATIO N, 2002 .
Source: EU ROSTAT; Creative Indus tries Research Unit/z ud K: own calculatio n.
'7
The mi nor relevance of the data from 200 2 is due to the complicated data collection proced ure at Eurostat, the Stat istical Office of the Europea n Communities. The office cannot collect its own data directly. It first has to gather the national business statistics. which genera lly involves many delays. In addi tion to this. the nation al data are "synthesized" by Eurost at in a lengt hy process .
The creative industries (EU-25) still show clear weak-
lion), engineering (EUR502 billion), or the food indus-
nesses in the development ofvalue creation in compari-
try (EUR791 billion) are able to generate turnovers ofa
son with traditional classic industries; on the other
similar magnitude to that of the creative industries
hand, with 6.4 million employees, the employment vol-
(EUR556 billion).
ume ofthe creative industries is well above average and
On the other hand, the creative industries is a
higher than the automotive and chemical industries (2.2
highly "fragmented industry" with three different levels
million and 1.9 million respectively); these classical
ofenterprises. A distinction needs to be drawn between
industries only produced one third of the employment
the micro-enterprises and freelancers
ofthe creative industries.
SCENE; SEE CHAPTER 5]
These key data on the creative industries imply that it can compete with the major European industrial
[THE CREATIVE
and the small and mid-sized
enterprises (the regional backbone ofthe creative industries) and the global majors and media corporations.
branches. Only these traditional branches, namely the
This small-unit branch structure employs an aver-
chemical (EUR601 billion), automotive (EUR721 bil-
age of five persons per unit, whereas traditional indus-
in EURbillion 8 00 700
600
50 0 40 0 30 0 200 100
o Crea tive
industry
FIGURE 14
Energy sup ply
C R EAT IVE INDUSTR IESTURNOVER IN THE EU-25 BRANCH COMPARISON WITH TRADITIONAl.
INDUSTRIES , 2 0 0 2 .
Source: EUROSTAT,Creative Industries Research Unit/z ndx, own calculation.
Cultural and creative industries in comparison with industry branches added value in EUR billions
Workforce in 10 00
Enterprises
Employees
Turnover
in EURbillions
number'J
perenterprise
per employee
55 6 .3
2t4·9
6420
1394 162
4. 6
86 ·7
79 0.9 7 20. 6
177. 8
44 22 216 3
281824
15·7
17 8 .9
16834
128 ·5
333. 1
601. 0
170.6
3 1421
61.4
3 11.6
144·4 164 .7
14 880
79 ·4
45 2 •2
En g ineering
534. 0 5 0 2 .0
19 2 9 1181
59·9
162 2 57 224 184
142.3
206·4
35 2 7 253 1
21·7
Texti le and clothing industry
11·3
81·5
industry
163-7
5 1.4
1 77 5
221 36 7
8 .0
9 2.2
Turnover
Cre ative in du s tries Other branches for comparison: Foo d industry Automobile industry C he mical
industry
Energy
Furniture
118.0
CHART 27_ K EY DATA ON T H E EU RO PE A N C U LT U RA L AN D CREATIV E I N D UST RI ES, 2 0 0 2 .
Notes: a) Data on enterprises for 2001. Classification of the creative industries in the broader sense comprises NACE codes 22.1, 22.3, 72, 74.2 + 3, 74.4, 74.8 and were adopted from the structural business statistics (sus). In order to classify the creative industries in the narrow sense, some NACE codes lis-
ted abovewere adjusted by approximation: publishers (22.1), reproduction (22.3), software/PC games (72.2), architecturelindustrial design (74.201-03) excluding engineers, advertising (74.4), design activities (74.87), and additional cultural branches in the narrow sense (92.1-5). Sources: EUROSTAT, sus 2002: CreativeIndustries Research Unit/zHdK; own calculations and approximations.
tries such as the chemical industry or the automobile industry employ statistical averages ofup to 128 employ-
It is therefore unsurprising that the creative industries
ees per office, workshop, or factory. Whereas the classical traditional industries are
CHAPTER 2.2]
have been on the agenda of the Lisbon Strategy
[SEE
for a long time, At the same time,
increasingly weak in their creation ofjobs, the creative
research still needs to be intensified, to more precisely identify the relevant driving forces behind the creative
industries can become a relevant driving force for
industries. The following chapter will provide an inter-
employment in Europe, providing they are given the
esting theory in this regard.
appropriate political attention.
LD I2l .-l
5.~
FOCUS: CREATIVE SCENE
In con-
Economic journals and publications generally pay little
5.1 REQUIREMENTS AND CHARACTERISTICS
or no attention to the creative scene, even though its
trast to the above-mentioned economic publications,
cluster structure ofmicro-enterprises could be treated a
the creative scene is well represented in sociological and
cohesive business form, and even though its sheer number forms a sizable share of the creative industries economy. This chapter compensates for this omission
political journals and newspaper supplrnents." It is regarded as part of the new "premarital," a sector con-
and launches the concept of funding of the creative
sisting ofdigital bohemians and the artistic proletariat. The combined private and work life and the mutual
industries as funding also the creative scene. We first explain the creative scene's conditions
complicity typical of young attitudes are received positively. Their emergence in culture and society is consid-
and characteristics, which are typically marked bya spe-
ered proofthat a new, flexible, and individualized work
cific overlapping of private life and working life, and
philosophy is on the rise, and as an expression of the masses and ofPost-Fordism. 59 Their concept oflife and
which are beginning to have an impact beyond the creative scene [S.l]. The differences and relationships between the creative industries' established enterprises and the creative scene's micro-enterprises are analyzed using the design scene and its professionals as an example [S.2]. In order to simplify the explanations, we first formulate the conditions that are necessary for a systematic approach. Comparing the creative scene and the creative industries is contingent upon understanding the notion of capital [S.3]. This comparison concludes in the development of a model that both examines the logic with which creative professionals act and negotiate [S .4], and also clarifies that creation ofvalue in the sector demands a broadened concept of the creation of worth.
work is now a model for other groups - ideals such as creativity, individuality, and flexibility are fused with the notion of self-actualization and weighed against financial limitations; nonetheless, proposing this vision ofwork as a paradigm for a new work concept beyond the creative scene is extremely problematic." The specific social, cultural, and professional profiles in the creative scene are of course not arbitrarily transferable: its members are primarily young, well educated in design and art professions, and more interested in culture than in politics or business. For the most part, they live and work in cities, they congregate in areas of the city that are still affordable, frequent the same restaurants, run into each other at parties, meet at trade fairs, exhibitions and art openings, and define them-
58
Statements made about the creative scene in this chapter are aimed at a model that presents the creative scene and the creative industries separately. and that outlines the options and motives ofpeople active in the creative scene. In order to develop this model, various sources were consulted, including specialist journals, discussions in the media, the experience ofteaching at the Zurich University ofthe Arts, and a comprehensive discussion with teachers from seven other Swiss universities. Several group and one-on-one discussions with representatives ofthe creative scene were also a focus (for more information on procedures and criteria, please refer to the Appendix).
59
see: VIRNO, PAOLO, Grammatik der Multitude (Grammar for the mulritude), in: GDI Impuls 3, Berlin 2005: SAEHRENDT, CHRISTIAN, Das Ende der Boheme, (The end ofthe bohemians) in: NZZ Literatur und Kunst, 3./4. 2. 2007: ZIEMER, GESA, et aI., Research project KomplizenschaftArbeit in Zukunft Complicity- the future ofwork) at the Institute for Theory and Design ofArt (ith) at the zndx, also: www.zhdk.ch, category: research, MORANDI, PIETRO, Research project Neue Selbstandige (The new self-employed) at the Institute for Cultural Studies (ics) at the zudx, also: www.zhdk.ch, category: research.
5.
see: MENGER, PIERRE-MICHEL, Kunst und Brot- die Metamorphosen des Arbeitnehmers (Art and bread - the metamorphosis of the employee), Constance,
2006.
selves through their work and activines, which are
However, the establishment of a creative scene is con-
viewed as creative and stand as a reflection of them-
tingent upon veryspecific social, cultural, and economic
selves.
conditions. Figure 15 demonstrates their diversity.
Even though the creative scene seems to be a dis-
Acreative scene can exist only ifmost ofthe above-
tinctly urban phenomenon, urbanity is also an attitude
mentioned conditions are met, and it also reveals some-
that can be compatible with a life in the countryside.
thing about the type ofpeople involved. They absolutely
Designers, filmmakers, musicians, advertisers, and
need to develop a praxis operating with flexibility, open-
architects are distinguished by how they approach the
ness, and curiosity so as to discover, identify, and solve
outside world, cultivate social networks, and absorb and
questions and problems in their work and their everyday
amplify trends. Those not necessarily reliant on a direct,
life. Consequently, the creative scene produces a style of
spontaneous, and expeditious exchange of ideas, and
life and work that is integrative and oriented towards
who are able to work reclusively, do not depend on the
creative solutions, and which absorbs and shapes the
urban environment. Today, mobility and electronic
social changes, which are pushing towards hybridiza-
forms of communication provide almost equivalent
tion. Professional expertise is applied more to open-
opportunities.
ended fields ofactivity than to traditional fields ofwork.
THE CREATIVE SCENE
AND ITS REQUIREMENTS
Social Informal networks Proximity ofwork and private life
Diverse communicative spaces Infrastructure for the everyday and work
Cultura l Expertise Multi-track Occas ions and locale Media
Trai ning and furthe r education opporrunities Contacts to projects and companies Infrastructure for initiatives Generous info rmation flow
Economic Micro-enterprises Temporary constellations Ideas; prototypes; micro -series Low turnover
Proximity to pote ntial clients Diversity for project nerworks Needs a nd interests Compensa tion poss ibilities
The creative scene praxis balances the economic, cul-
progress character. It forms direct contacts to current
tural, and social aspects and directs them pragmati-
developments, compels a variety ofalternative solutions
cally; thus avoiding any radical positioning. Moreover,
due to a shortage of resources, develops ideas quickly,
the massive gap between professional expertise and
and - as a response to manageable and self-posed ques-
income is not considered disproportionate by the com-
tions - rejects concrete planning for developing options
municative patterns ofthe creative scene; they view it as
and keeping them open. This is all due to conditions in which little is valid ofitselfand much seems contingent.
a constellation that allows various aspects to be balanced in relation to one another. Uncertainty and interim solutions are dominating factors. Creativescene
A thoroughly unique notion of value results in the capability to define issues, initiate projects, and enable
professionals are active on several levels - working in
collaborative approaches to production. If individuals
part-time positions, completing second degrees, invest-
in the creative scene are evolving other work or living
ing a great deal of time in projects. They rarely earn
models, it is not due to the creative scene's presumable
more than the bare minimum, yet they feel sheltered in
provisional quality. Its specific autonomy forms a com-
their networks. People in partnerships both work and
plex and dynamic link between economic, cultural, and
share childcare.
social aspects, and it is precisely this mix that provides
All of this is achieved and is even satisfying and enjoyable, providing the differences and contrasting
a vital, driving force to established enterprises in the
features of these complex constellations remain open.
creative industries. The creative scene's ideas, products, and services are often more experimental, its driving
The part-time job may be frustrating and unavoidable
questions less mainstream, and the project-based work
but it also helps to develop expertise. Studying takes up
is more flexibly organized than in creative industries
too much time, but opens up new opportunities. Time
governed by routine. All this can be stimulation to the
invested in the company is difficult to calculate, but
more established enterprises. Moreover, if these firms
allows for experiments and freedom in designing prod-
also employ professionals from the creative scene, these
ucts as well as in forms of cooperation. The people
pragmatic employees will think beyond specific busi-
involved all have similar questions and no real alterna-
ness categories, will expand traditional concepts of
tives, but they have a communicative network and the shared need to be free to work on both individual and collaborative projects. The urban environment demands
products and activities, inspire new work models and means of communication, and introduce social experi-
constant attention and devotion and, in return, provides a driving force and a social and professional network. The creative scene is thus a catalyst that connects various fields. It is a testing ground for cultural, social, and economic formats and communicative patterns in which people recognize themselves, communicate, and interact. Its main defining feature is the work-in-
ences and contacts that are based on mobility and curiosity.
5.2 DESIGN AND DESIGNERS AS A PARADIGM OF THE
conversely, there is the more common notion that
CREATIVE SCENE It is
design produces ideas that facilitate new products. Designers study the desires of customers and translate
possible to describe general cri-
teria only if the creative scene is observed as a whole. Focusing on a specific profile (which is also essential in
vices that have clear production criteria and stand out
tive scene with a specific (professional) expertise
among competing products. Designers establish the aesthetic and functional criteria for products and ser-
entails. Focusing on the field of design is not arbitrary.
vices, set quality standards and design presentation that
Design is considered the leading discipline in the crea-
ranges from complex marketing schemes to branding.
tive industries, and designers constitute a large propor-
Designers conceptualize simple objects into complex
tion of the creative scene. A review of the design praxis
contexts, attribute a reflective sensuality to materials,
in the creative scene will establish the paradigmatic features ofthe as a whole. 51
develop and optimize interfaces and systems of sym-
5.2.1 DESIGN
But what is design exactly?According to
the traditional definitions, designers create objects and
bols; they are aesthetic workers and specialists in communicating information and in how communication flowevolves. The term "socio-design" is radical: it questions how our day-to-day lives can be designed.
jewelry, print media and web sites, fashion and furni-
It is foreseeable that future developments will call
ture. They strive for functionality and coherence, do not
for designers' expertise to comprise knowledge about,
perceive their work as art, improve existing products
the desire to reflect on, and the willingness to design
and develop new ones. Theywork with the sensual qual-
the world. Designers are active in everysocial, cultural,
ity ofmaterials, images, and atmospheres. Theyare par-
and social area. Design embodies the hope that design-
ticular in how they define themselves, they are creators, and they develop and realize concepts. Their skills
ing the world is a way of overcoming the difficulties a post-modern society has in orienting itself. The categ-
include aesthetic judgement as well as technical exper-
ory of the in-between will become crucial to design praxis. Design expertise is an ability to communicate
tise and craftsmanship. Creating and manufacturing a functional article requires design know-how, a comprehension of how aesthetics and functionality interact, crafts expertise, and knowledge of production processes. The current view of design still takes this tradi-
disoriented potential customer bydeveloping and establishing manuals, rules, and procedures for orientation. Such a concept of design tends to put the imma-
tional notion into account, but no longer considers it fundamental. Today, it is the function of design itself
terial above the materialization. The joyofworking on a design expands - it wanders into ideas and concepts,
that is being questioned and numerous and diverse
into dialogs and self-representations, into events and
aspects of it illuminated. One main topic is the asser-
publications.
tion that creativity leads to innovation bywayofdesign; 51
.... '" ....
them into concepts to be conveyed to products and ser-
the creative scene) can reveal what working in the crea-
based on variousdiscussions; see details in the Appendix.
and control, which defines the relations between objects, the visible, the sensual phenomena and the still
~~~__~!~3_~~!._~.!~~~~~J~.s;'!3..9;:~~~.!__5'Y3;:.s:'~l33;!~~ __~~~J!!:.:;J3~~.:..": I
'~~~!...~:.~~....sJ'.!.s~5J'.!~~~j.s~!~~:'~J~~~~~';':;'0~;.~~.e.s~~~!~~~5~~~!3'y.;d oncept of media art is dictated by political~ ith statements and concerns for which .........--..---..-....-------..---...-...-...-~...-..-..-..-...---..------- .........----....... ......--------...-...-..-...-..-.-.--....-:
----..-
--..---
~.........................------...-----------........
~a nd medi a-theoretic positions. "What we~there is otherwise little room for within ou ~..........-..-..-........................................... ........ ......... ................. -"'........ .........~..-..---..................---~
------ ..-------------- ---- -~do is not easy to sell. We deal with elec-~society." ~:.-----_ -- -- _-- _------ -- -------------- ----~ .........
........
.......
......... ........
........
......... ..................
~~l;__~~~~~~~ __~!~~__~~~~~;..:v3.!~j ::.s;§~ ~~~~:: :
~u s u a ll y a combination of soft- and hard-~" I t ' about counter-information."
--
...-----
~----...-----..-............-...-..-------...---------------....... .........---------~...-..-...-..---..-..---..-..-..-..-----..- ........
........--...-.,......; ~ are. Manyofour projects are participator ~As part of"Bitnik," Carm en Weisskopfuses ::.-'............ ....... ...........-..-..------..---........_------/~...--- ...................... .....................................-..................................---- --.....---............................--.: in nature and emph asize the process, th ~t h e computer and all its possibilities to :----..- ..----------------- ..- ----...-....-~...- ...-----..---...---...-...-...--....-:
_....-_--- __ --..-_ ------...----------_ ----..- --..----~ex a m i n at ion of content or interrelations ,~question media practices. Such as when she ~~--...------- -- . .-..----------...-..--- -- ...----~...---------..------ ------- ...-...-...-...-...-....-....-: ........
.........
........ .........
......... .................
.................. .........
.......................
........................................ .........
lIa~~j~._~~s.~~.!!!!3_.e~.s~~J>.!__~~.3.3l:;~~~~.3~~~--~.!-~!~~~.-~~~--0.!--!.-~.s~553. ° ~ he computer is a copy machine. I am no ~produce and disseminate independen
~------...-. . . . . . . .- -..........-.........-----.. . . . . . .-. -...-...........-..-..-...........-...-..---...-.. . . . . . . . . . ...-~...-...-...-...-...-------...-...-...---------...---------..- ..........-..-..-..-----...-...-...-.--=
~i nteres ted in selling something that I can~broadcasts. "It's about a form of counter-
--
~---..-....-...-...........-.........--........- --...----------....----...--------....-....---..-..-........------...-~---...-------...-...-...-------------...- ...................-........................................ ..........--....---...-~
~· u s t as well - and without any loss - copy a~information , about a counter-publicity."
f1Ih;;d~-;i;;;;;;d;;;;;;;,-~ ~
wh;~;;;ir?WelCGold;;ith;colIege
~
0
th;Uni;;;;ir;-;rL;-nd~;:f;;~;;,--;hT;;h
~" To me, art is an open space."
h;;T;;;;i;;;jr_;chh;;;ti;(g;~;;pr-;d;~~P7t
~...--------..-"""""""""""".-"'"-",-----"",,,,-------------=
~....-..---..........---..-------....-....-....-...-...-...-........_ ..-........_ -----------------.-:
~Her interest in the mech anical has, for Car-~radica l form of collaborative film produc-
-----..-.........--------....----- ....-....-..- ----................ ..........-_..........-----..---....-..-..---.......--.................-........-------------..-.--:: Jlm5~ ~!~3_~~...f.~..!~.s~._~~~.s~;.~:..~~;:;~~~.:..:!:.~:..~.3~J~.!!--~!~3--~~~eP..!~.:;!~ n ~---..-.--..........-........
__
........................
........
...-...-~..-----
the-~thatwill facilitate joint production of docu1lc:r;ti;a1.-~;;pti;;;;;g;-;drn--gp~;;~;__;;;r;;yfil;;:-,;divid;a1-;-;;;;;;;-;I~ ~;-"-----..-...-. . . .....-..------..--.. . ...-----...---..-.. . . . . . . _ . _.. . . -. ------.. . . . . . . .. ..-~--...---...------_..-_---------...------...------ . . . . . . ...-.. . . . . . . -. ------..-------=
fflti oning ofsystems , constructions, and
~P ri o r to her studies in New Media at th ~draw upon the work of "Bitnik ": users can ~:-------....-.........................-.-----------...-----..........----...-----...---...---.--...-........~-------_...---..----------------..------ ................---...-...-....-............................---........-: _~~;.~~~~.;;.~5Y3!5~;.~;.~!~.s;y~;.~:..~~~~J;.~;.:..!~~~~--~~~~--~.-~~!:.~~l~ m
__
---------------
~~me time in NGOs and toda y, alongsid~them into new films oftheir own using "Bit-
~...-...-_----- --....-......~ -~her art activities, she is active in a projec ~n i k's " software.~
~--.---------------------------.-.---.-.---.----------------;-~ 1I;~.s:.s !~5~.3.33.;.s~~3_~~~;.~0..9._~~.!_~.!~~ flF~.!.~~0j._~~y.!~~~~~~~!:.3~~~:..~~~5,
~he worked as a web designer, but quickU~" From time to time you still have to do
_
~ r-----.-.-----------.-------------.-----------------.-----~:---.---_~ ~fou nd it incompatible with her artistic~t h i ng:'~ ~~........ ...................-....................-....-....-....-....-....-....-....-...-...-...-....---....-....-....-------~------~
--------
orne-
~ vork. Aside from organiz ational reason s ~ Ithough prizes are won at video festivals ~....-....- ....--:; ~ ......-....-.-:;
-- ---- ------------------------------ --
-- --
------------
~s h e is a freelance designer and artist, a nd~an d money is sought at exhibitions fo
. . . . . . . . . . . . . . . . . . . .------.. . . . . . . . . . .-. ---.. . .-. -.. . .--.. . . -. ---.. . . . . . .~. ..-..-..-------...-----...---...- . . . .....---.. . . . . . .--.. . . -. -.. . . -. --------------- =
~~------------
rJjb~0._~5~3~~.!!~~~.s~33~.3;:~~~~;.~~~~~~;.;.J;.~!;.~~;.~3-J!.e;.~l.:;.:..;.~~~__~ here were content-related aspects that a lso~exist withou t public funds . Carmen ~....-...-- ...- -- -- --...-~ --....- ....--- ------ ---- ---- --....-....-.-:;
--
l ed her to leave the job. Instead, she now~ eisskopffeels reducing financi al sup por ~---...---------------------------- --~------...---....---....-------...-...-----...-----..--.--: teaches web technologies and digital imag-~is wrong. "Cultural production should no
-
. . . .--------.. . . . . . ...-.. . . . . . . . . . . . . . .-. -...---....-....-....-~
~~
fifiing to oth er professionals.~
--..-----------
=------.. . . . . . . .----------.. . . -. ---.. . . . . . . . . . . . . . . . . . .-. ---.. . . . . . . -. ---.. . . -. -------.:
be dictated by the rules of the market eco-
~;;y;Io";;;:.--It--;~d;-;p;;;f;;d;;e1~-
-------- -- ----...---.;
~----....---..-...-...-...-...-...-...-..................-..........-..---........
........ ........
" So ci ety is dictated by the media and th ~m ent th at is sociall y supported. If neces~~-------~ cod es of conduct they imply. Thi is what I~sa ry, "Bitnik" will also create this open
----
. . -. . -. . -. . -. . -. -. .- --....-----
..---------------..-----..--- ------------
----------=
~--------------.-.---------.-------.----_~ ~lIfIIfIE"'-------------------------------------------------------con front as a media artist." ~~space themselves, and realize projects even
--
~-------------........ ........................................------~ ...........-------...-----------------........ he art pieces intervene in medi~:------a pro-~i f subsidies cannot be found
.....-:
--------
~--------------cedu re s ; the yare determined -------------------~ by broaden in
ffIIIII
5.2.2 DESIGNERS
In the creative scene, the work ofthe
designers is beginning to resemble a permanent, practical study ofconditions and design possibilities. Professional skills are interwoven with a framework of demands linked with expertise and contemporariness.
supplying, the company where they work, the technology that changes this work, are thoroughly unchallenged preconditions. Designers in the creative scene firmly embrace the stereotype's important criteria. Being a designer is considered a gift that is revealed early and that grants
The fields and limits of design and the design praxis have become less obvious, which is all the more
immediate joy. The lack of interest in business is
evident in related areas in the creative scene - in univer-
explained by the designer's philosophy. Design is com-
sities for instance, where traditional and progressive, decisive and perplexed, or skilled and experimental
municative and involves teamwork.
ways ofliving and working meet and mix.
The image designers have of themselves seems to have remained broadly consistent. Professionals in the creative scene can easily agree on the basic parameters
STEREOTYPES AND PRACTICE:
The uncertainty with
which individual designers respond to the developments
with those in the creative industries. In the process however, they both forget that the creative scene had
in design and its fields of activity can be clarified by
already long established a unique form oflife and work
examining a stereotype. Designers in established enter-
that decidedly differs from the norm. The considerable
prises, who sometimes prefer to call themselves Gestalter in German, vary it in many ways. The true Gestalter
differences become apparent only upon closer inspec-
has always been a Gestalter, something he or she recog-
tion, as seen in Chart r6. The chart distinguishes between the social, cul-
nized early on. They consider everything as design and
tural, and economic levels. The classifications on the
work on improving the world and making it more beau-
social level stem from the varying distribution and
tiful; they are specialists and are independent; as authors, they integrate services with individuality; they
emphasis of professional and private life. For the professionals in established enterprises, professional atti-
are team-oriented and work in the continuity of select
tudes and experiences also generally shape and influ-
assignments; they are recognized by others in the field and are successful in the face of the competition; their product is prestigious and they earn enough.
ence their personal realm. Designers in the creative scene are familiar with this attitude, but integrate both realms a great deal further.
Thus, designers in the creative industries define
On the cultural level, the difference seen in the
themselves completely by their way oflife and the manageable scope oftheir work: it is about the joy ofconveying design aptitude successfully and tangibly. Premise and content are provided by a contract from outside; designers are rendering a service and while rendering
social level increases. It is important to note that while representatives of established enterprises draw on pro-
this service are also authors. Questions about subjects and business hardly interest them. The market they are
fessional expertise and recognize it as their cultural capital, designers in the creative scene use their expertise to tap culture and to anchor themselves in their propensity to personalize and be innovative.
M
.-; .-;
Designing is central to both, for representatives of the
dIe the volume of trade, or to implement design strate-
creative industries through customers and their assign-
gies to create a company look.
ments, for representatives ofthe creative scene often in
The differences are more obvious on the business
a much more diffuse sense. Design demands a versatile
level. Professionals in established enterprises may well
design aptitude, based in curiosity and the desire to
be sympathetic to integrating private and work lives, yet
experiment, as well as in the ability to implement this in
this would never be an alternative for them, because it
look, in physical materiality, in space, in sound, and as
results in a precarious financial situation. Professionals
a process - and for the development of interfaces
in established enterprises consider the dynamics
between humans and objects. Nevertheless, limits are
involved in developing projects on the creative scene
in fact put on the creative scene if, for example, the com-
level, or even the limitations entailed, as unnecessary or
plexity of the tasks call for additional training in order
even as a sign of inability. On the other hand, those in
to develop research projects on and bydesign, or when a
the creative scene would have nothing against earning
certain size ofan enterprise is required in order to han-
more; yet there are various things standing in the way.
STEREOTYPE
SELF-IMAGE ESTABLISHED SMALL AND MICRO-ENTERPRISES LARGE ENTERPRISES OF CREATIVE SCENE THE CREATIVE INDUSTRIES
Social Hab itus Teamwork abil ities Recognition
Mode l vocation Profession a nd network Organization ofwork Linking private and work life In the profession an d environment In the professiona l field and peer groups
Cultural Expertise/skills
Professional expertise/s kills
Individ ual signature Conternporariness Profession as culture: Beautification Development Ideas Economic Enterprise Customer orientation Authoring Subsistence
Design craft Working in the mainstream
Professional expertise/s kills as cu ltur al identification Individualization In touch with innovative tendencies
Styling is important Continuity In defined framework
Rather secon dary Rather fresh involvement Core expertise/skills
Established; preferab ly selfemployed Primary Offset by customer At least sufficient
Micro-enterprise; personal life besi des employment Offset by personal projec ts Im po rtant . also in services Achieved on ly by mu lti-trac k options
CHART 28_ STEREOTYPE AND SELF-IMAGE.
The main barrier is the belief, shared strangely enough with professionals in established enterprises, that the
This viewis evident in almost all ofthe statements made by the creative scene professionals we interviewed. And
logic involved in design is totally different from that of
it is not surprising: those who associate their personal
money. The question is only how to fuse the two.
expression with the motivation for combining work and everyday life, recognize the important role distance
DESIGN LOGIC AND MONETARY LOGIC: Whereas estab-
lished enterprises recognize the need to compete on the
when exploiting this facet. It is about identity and orientation. The market becomes a concept of reality that is
market, and therefore subject themselves to economic demands, professionals in the creative scene are
in conflict with the concept of pleasure. There are few attempts made at securing a loan for a company, creat-
reserved or admit a lack ofthe knowledge in this regard.
ing a business plan, or investigating the labor market. On the contrary: many perceive an important part of
Their studies concentrated solely on design expertise and not on market-related issues. Thinking in business
their work in what one interviewee called a "hobby":
terms is considered a constraint that restricts every-
designing with great expertise but avoiding the pres-
thing to economic goals, and consequently remains
sures ofcommercialization.
inherently foreign to the design process. The case is simple. The logic ofdesign belongs to the designer; the logic ofmoney is anonymous. Designers inadvertently connect whatever they design to them-
In such proclamations, designers in the creative scene take on a position that at first may seem deliberately uncooperative - which is rather surprising considering they are a service-related branch. It makes them appear dysfunctional and inconsistent in relation to the
selves. Their work fundamentally involves nurturing everything that distinguishes them from others. Their expertise is incorporated into the tiniest decisions. In
significance that they attribute to both the commission and the client. Yetthis is really about something else:
contrast, those who follow monetary logic disappear as
the position of the young designer suggests a different
individuals, while attempting to utilize that particular logic for themselves. These designers are skilled in
concept of market philosophy, business conduct, and expertise. For innovative design work to be at the core,
assimilating the logic of money, and accordingly, only
the client should, in the interest ofproducts and proce-
become visible when they earn it.
dures, ignore notions about the traditional distribution
The market defines itself by the abstract medium ofmoney; design, on the other hand, in subjectivity that strives for the authentic expression. According to one of the professionals we interviewed, a designer who establishes a company will soon no longer be active as a
of work. The logic of the market should in fact touch upon the logic of design, since the former increasingly tries to transform all aspects ofsociety. This is not about judging this attitude and its related practices. Professionals in the creative scene are conscious ofthe price they pay for their desire to achieve harmony, identity, expression, and credibility - it is to
designer - whereas designers in the creative scene, who combine both and yet remain within it, are admired exceptions.
live with persistent uncertainty. They know how little
io .-{ .-{
they earn and that it should be more. They do not know
5.3.1 THE CONCEPT OF CAPITAL
how things will continue; yet fundamentally they would
To systematically categorize the challenges encountered
not alter a thing even ifsome aspects do need to change.
byprofessionals in the creative scene, we propose exam-
The joy of real and reliable work is always mixed with
ining the necessary expertise according to its symbolic
the frustration that it is not adequately paid, that the pay
and financial aspects. From an economic standpoint,
is substantially lower than the tariffs of established
expertise is capital that is available to professionals and
enterprises. At times they are weary ofthe fact that work and leisure can hardly be separated; then, suddenly, this
can be implemented - it is social, cultural, and financial capital. These kinds ofcapital 52 are interwoven and can
is precisely what they love. If only one did not also have
only be broken down analytically.
to "flirt creatively" for anything to happen ...
Regarding the creative scene, this concept ofcapi-
These brief considerations have characterized the
tal can help us understand its form ofbusiness, and can
creative scene in general and its designers in particular,
represent its efforts to reconcile the conflicting interests
and have also defined their specific place within the crea-
- expertise, innovation, self-fulfillment, communica-
tive industries. The creative scene is marked by a crea-
tion, standing, and income are all considered equal
tive practice that develops new models for life and work,
needs.
balances the weak and strong points in a seemingly
There is one, clear priority for established enter-
non-economic manner, which is precisely what allows
prises: market orientation. Ofcourse, a business praxis
for creating innovative projects and product ideas.
reliant on contracts, orders, turnover and profit may
Established enterprises, on the other hand, follow the
well make use of social and cultural skills and display
familiar logic ofthe market.
them prominently - yet the difference is that they need
It is still unsatisfactory that economic weakness is still a feature of the creative scene, despite its overall
to be instrumentalized and calculable. The broader concept of capital sheds light on the
substantial turnover; it is furthermore unsatisfactory
relationship between the creative scene and creative
that the vital, driving force it provides is not appropri-
industries, by facilitating a comparison between the
ately acknowledged and implemented.
creative scene's micro-enterprises and the creative industries' established enterprises.
5.3. CAPITAL IN THE FIELDS OF BUSINESS AND ACTIVITY
The considerations above have presented a
SOCIAL CAPITAL:
Social capital is defined through
complex picture of the creative scene, yet have not sys-
social relationships and the positive and negative forms
tematized them, or specifically focused on economic
of sanction they contain. It is evident and operates in
issues. Below, we therefore propose a set of terms that
the networks in which everyday life and work, with all
describe the creative scene practice in economic terms,
its conditions, is communicatively negotiated. A crea-
define the fields of business and activity, and that can
tive scene professional who is unable to network with
consequently cross check the transferability of their
others will not achieve success.
models oflife and work. 52
The notion ofdifferent types of capital is derived from PIERRE BOURDlEU, without listing the details he developed. It assists here in comparing the creative scene with the creative industries. For more on BOURDlEU'S notion ofcapital see: BOURDlEU, PIERRE, Raisons pratiques: sur la theorie de Paction (Practical Reason: On the Theory ofAction), Paris, '994.
CULTURAL CAPITAL: Cultural capital is defined through
skills applied in generating, handling, and evaluating
Creative scene professionals identify themselves through their cultural and professional skills as well as
cultural practices and objects. Professional expertise will become as important as the wayin which it is mani-
their affiliation with interesting social networks, such as degrees, references, lifestyles, their own studio,
fest. The product must be visible and recognized. Cus-
social contacts, their clothing, ways of talking, and
tomers alone will barely suffice. If possible, the media
knowledge. They distinguish themselves through their
has to take notice, and the region and the city have to
symbolic capital, which is constituted from their social
employ their qualities in trade fares, exhibitions, and
and cultural capital, and which ensures them the confi-
events, for instance.
dence and trust they seldom receive in the form of a loan. Ideas and definitions of identity become money
FINANCIAL CAPITAL: Financial capital determines the
that leads to work.
availability of material resources and infrastructure. Creative scene professionals have little ofthis capital, as they have little income. Their line ofproducts is limited.
Money is then turned back into symbolic capital via the product that produces the kind of value added characteristic of the creative scene: creating credibility
They do not need many machines, expensive studios, or
and recognition, which indicate chances for market-
prestigious architecture. The way in which they present
ability and which are based on the creation ofvisibility
their products is inexpensive: they rely on having dis-
and public recognition.
proportionate success. Eventhough the three kinds ofcapital are considered as one single, unified capital, they are often counterbalanced so as to compensate for possible deficits. This often happens when creative scene professionals invest their entire capital to secure an assignment, production conditions, production, recognition, and continuity of work. They lack the finances, and have to compensate with social and cultural capital. Consequently, they introduce all oftheir individual features, successes documented in their CVs, and recommendations from respected authorities. In this way, the following picture evolves: I have little money, but I am somebody, and able to do many things, it will be worth your while giving me commissions, making me a partner, and recognizing me as being better than my competition. Myabilities will serve the client. I am what you see and that is in the client's interests.
Creative pro fession s outside the creative industries
5.3.2 FIELDS OF BUSINESS AND ACTIVITIES
Creative indu strie s with established enterprises
Differ-
entiating between fields of business and activities
Creative scene
reveals again how creative scene professionals practice a different union of professional and private life than
Creative scene professionals social. cultu ral. and financial capital
professionals in established enterprises. Both areas distinguish themselves through the logic they use to align their praxis with specific goals. This logic is not always immediately visible and has to be tapped in various different ways [SEE CHAPTER 3.1.2]. Figure 16 outlines the different fields ofactivity in the creative scene, the business sector of the creative industries, and the creative professions outside the cre-
FIGURE 16_ FIELD OF BUSIN ESS AND ACTIVITY AN D DIFF ERENT KINDS OF CAPITAL.
ative industries. Creative scene professionals are at the center and represent the micro-enterprises; they are defined by the interaction ofthe types ofcapital.
are not inherently restricted . The work has the solid core ofprofessional expertise, applied in a professional field;
The work conditions in the cre-
but this does not yet clearly delineate its profile . It can
ative scene are defined by those that constitute the
assimilate everything, which is one condition for inno-
creative scene in general. This essentially implies that
vation.
THE CREATIVE SCENE:
creative scene professionals rely on curiosity, associate
The term "business field" is helpful for this rea-
the need for self-fulfillment with professional skills ,
son. The creative scene defines itself comprehensively
work independently on projects in micro-enterprises
through its various fields ofactivity. It is not a stepping-
that absorb trends and react quickly and flexibly to
stone, but rather a system that integrates social, cul-
changes on the market. They are team-oriented and
tural, and financial capital into a single, specific unit.
have a multi-tracked concept oforganization; they have The creative industries
limited economic skills and earn less than they should;
THE CREATIVE INDUSTRIES:
they seek a balance between authorship and providing a
are organized into established enterprises; their tradi-
service; and they look to establish contacts, in particu-
tion provides a structure that can be clearly navigated by
lar via the media, in orde r to gain recognition for them-
outsiders. Branches define themselves by their products
selves and their work. Their work amalgamates these
an d access to the market. They bring professions and
factors and is fundamentally hybrid .
groups of professions together, so as to gather the
The logic of this hybrid method of working also
expertise necessary for production. There are other pro-
applies to non-work related contexts. Not even the pri-
fessions besides the creative ones, including secretaries,
vate sphere can consistently appear as the other, because
accountants, marketing experts.
the work networks are basically informal and therefore
Conditions ofwork remain the same and the skills profile unchanged for as long as possible. The enterprise's
prises aim to combine professional expertise - cultural capital- with a focus on the dominant financial capital,
profile, no matter how small or how large, can be out-
professionals outside the creative industries are rarely
lined accordingly. Enterprises are established on the
self-employed, and are consequently limited to being
market and the dominating factor is the logic of finan-
employed for their professional skills alone. Designers
cial capital. They only shape changes on the market,
in automobile companies work hand-in-hand with other
insofar as these correspond to the enterprises' interests in establishment, expansion, and diversification.
designers and research and development departments.
Accordingly, work in established enterprises is clearly
5.4 THE LOGICS OF ACTION AND THE CREATION OF
defined. It provides obvious and direct evidence of success, situated in the traditions. Even if this takes time,
VALUE
as also with small, established enterprises, the definition ofwork remains well defined.
The now-introduced variants in the social, cul-
tural, and financial capital and the professional fields of business and activities, both within and outside the creative industries, enable a systematic analysis ofthe logic
The creative scene's constituent hybridization has
of action applied by professionals within the creative
only a marginal impact on the creative industries' estab-
scene. Clarifying how they synchronize their motives
lished enterprises. What these in turn adopt from the
and options explains the decisions behind specific
creative scene loses in the process its comprehensive character in the framework of their logic, and can be
methods of production, product designs, and forms of
only selectivelyabsorbed and adopted with their orien-
communication. Or to put it another way: the motives that determine the professional's behavior are also cru-
tation in mind. Although hybridization may be the expression of a fundamental change in the world of
cial to the qualities and dimensions in which their work influences the creation ofvalue in the creative industries
work, the established enterprises of the creative indus-
in general. Financing measures will make sense as long
tries do not design it; this hybridization comes upon
as this process ofvalue creation only serves the creative
them, and they adapt to it.
industries as a whole, while abandoning the individual professionals in the creative scene to continue manipuAll the various
lating, and to compete for, the available forms of capi-
forms and focuses of work performed in creative professions outside the creative industries cannot be reduced
tal. Yet they must - and this is an important require-
to a few categories. The only thing certain is that this work is instrumentalized and functionally related to producing products that cannot be attributed to the creative industries.
To reconstruct the creative scene professionals' logics of action, a model of the motives and options behind their actions are outlined below.
Work performed by creative professionals is as clearly defined as work in creative industries, with one
5.4.1 STAGES
important exception: while small, established enter-
cific manner. This is revealed more distinctly when a
OUTSIDE THE CREATIVE INDUSTRIES:
ment - keep in mind and include the diverse motives.
Expertise in the creative professions is
applied to the fields of business and activities in a spe-
....N ....
Process
distinction is drawn between the production process (from commissioning to realizing a finished product), the product itself (from the original idea, to its materialization, and eventual services and advertising), and the presentation (from product perception to its distribution). THE PRODUCTION PROCESS:
Options Field of business and activity
Product
In all fields of business
and activities, this process ends with the completion of a product. The actual start of this process, however, is
Presenta tion
determined differently by the creative scene than by other business fields within and outside the creative
FIGURE 17_ WORK STAGES.
industries. The reason behind this is can be seen in the way micro-enterprises work, providing they are part of the creative scene and not established. They do not sim-
from the special pressure under which products are
ply line up commission after commission, project after
developed. Limited available resources continually pro-
project. Internal driving forces, external stimulation, project demands, and commissions mix with their work
duce new creative friction regarding the concept and production. The surplus ofideas regarding what is real-
processes. The differences are less noticeable in the
istically feasible affects product requirements, i.e. to be
production process itself The flow of work is more
as coherent as any successful product, yet at the same
open and less formalized within the creative scene than
time to set an example, be innovative, and different.
in the two other business branches, because they are
Ifwork processes in the creative scene are already
less precisely defined and less sharply calculated. In
more open than in the other two business fields, then
other words, the process can be kept more playful,
their products ideally embody an exemplary integration of new ideas with an initial, provisional implementa-
inquisitive, and experimental. While professional qualifications are not questioned, they may well be stretched to their limits. THE PRODUCT:
The term "product" covers everything
from the simple object itself to communication and interactive design, from visualization concepts to con-
N N
....
tion. The notion of product held by the creative scene likewise indicates its dependency upon innovation and, consequently, its innate conflict with established enterprises that view new industries as a variation of established ones. The significance and authenticity
ceptualization, and from actual authoring processes to
THE PRESENTATION:
straightforward service provision. Professionals from
of the product and its creator need to be conveyed. To
all fields of activity can be active within this broad
whom they direct themselves and how their communi-
realm. The creative scene's characteristic features stem
cation activities are interpreted differs greatly from
branch to branch. Sincethe creative scene seldom manu-
business, must function properly; there is little space for
factures products with a large number of customers in
accident, disturbance, or experimentation. It is difficult
mind, there is no issue ofdistribution. Nonetheless, the
to break with routine.
recognition the work receives still remains a great concern. Recognition is the cultural and social capital that
5.4.2 MOTIVE AND OPTIONS: THE SPIRAL MODEL
can offset other deficits.
The model is now decisivelybeing expanded. The differ-
Creative scene professionals accommodate the var-
ences between the fields of business and activities have
ious characteristics of their production. For one thing,
been described; now we tune to the professionals who
their workspace is not private or closed off from others.
need to position themselves and navigate within these
To keep the cost ofrent at a minimum, numerous studios
various fields.
are rented as a group. In turn, the products are managea-
The arrows in Figure 18 indicate their options.
ble, because there is a lack of financial capital for com-
Whereas the circle that runs through the creative scene
plexprojects. Consequently, they can exploit aspects such
emphasizes the possibility for remaining within it.
as the allure of the object, the appearance of the image,
In regard to performance, the amount offreedom
and its spatial presence. They can attend various events,
they actually have in choosing between various work
which helps them to gain appreciation and recognition.
options is naturally ofimportance to people working in
In the end, they themselves are often the medium ofcom-
the creative scene. We could argue, however, that it has
munication that promotes and draws attention to an
little influence, as these professionals balance their
object, attending events and exhibitions, producing
motivations and options using a mixture ofassessment
atmospheres, or placing functional objects in the public
and experience, projections, discussions, and desires.
space. They draw attention to themselves by serving spe-
The resulting chosen course is always provisional and in
cific events - and, in this way, indirectly draw attention
a state ofcontinual review.
from the media, which is likewise being served. The attention granted to the creative scene, its
The fields of activity within the creative scene are familiar to those working in it. In comparison to the
professionals, and its works, is aimed at the unexpected,
fields of business in the creative industries, or creative
or at least the novel. Ifthe object ofattention is concrete
jobs within the economy, the foundation of experience
and visible, the new is apparent. If'it is an idea, a specific
is rather limited. Nonetheless, a certain level of know1-
person or group will always be visible in the back-
edge can of course be presumed - among the young,
ground. This creates forms ofquasi-family support and
thanks to internships and discussions; among older people, through previous practical work experience.
informal networks. In contrast, established enterprises in the creative
These careers are considered options when experience
industries are bound to their clients. In the face of so
and prospects within the creative scene begin to raise
many successful and veteran products, new approaches have a hard time - ifthere are any at all, which is rarely
too many questions. For creative scene professionals, this begins to be an issue when they need money; they
the case. Because what works within an established
might for example want to start a family.
M
....N
In any event, there is no foreseeable motivational situa-
one occupation at a time so as to make ends meet finan-
tion that applies to the entire creative scene or cast
cially. The catchword "precariat," which draws atten-
doubts upon it as a whole. Of greater importance than
tion to the difficult financial conditions, can also
the individual motivations for renouncing an affiliation
obscure the good reasons there are for persevering. If creative scene professionals review the options
Options
Process
both within and outside the creative industries, they do so not with rigid dichotomy
[SEE FIGURE 19].
In their
view, the differences are not that drastic. Professional qualifications remain the focus, and only the context changes; the desire to implement personal expertise as fully as possible can be pursued in numerous ways; the different forms of capital can indeed be occasionally exchanged in favor of a better income; the insecurities ofself-employment are weighed up against the security of regular employment; individual projects can still be pursued in a subdued form when the demand for services increases. Options Presen tation
Looking in from the outside, however, the differences between business and activity fields are clear.
FIGU RE 18_ MO TIV E AND OPTION S.
While the players do not approach their comparisons systematically and their concerns become harbored in a field of interdependencies in which mind games, intui-
'" .... N
to the creative scene and working in an established busi-
tion, likes and dislikes, and - especially in critical situ-
ness is, in particular, the gradual development and vir-
ations - serious deliberations appear, the various forms
tually unnoticed crossover of a small creative business
of logic in business fields can be characterized by the
into an established one. The course chosen by professionals in the creative
variation in their priorities. The creative industries are targeted primarily at success on the market; the creative
scene is varied and ambivalent. Those who feel accepted
scene toward self-ennoblement, ideas, and flexible
and at home in the creative scene can handle the fact
projects. Creative work within the creative scene's field
that nothing is obvious or lasting. They merge the per-
of activity is therefore somewhat different to creative
sonal with business, realize their potential as fully as
work in other occupational fields; the same professional
possible, and symbolically offsetting the meager earn-
expertise is determined in different ways, especially the
ings with the fact that their projects lie close to their
desire for self-realization through one's work.
heart and that the work reflects both themselves and
Developing personal projects is an example of
their skills. Furthermore, they often pursue more than
this. Because these projects do not earn much money,
Options
Process
Expertise is deepened and expanded by synergies, such as those that appear when various skills work in collaboration. From the very beginning, a job is ripe with the potential for innovation: because routines are avoided and new constellations are sought, something new may always be created or conceived, even if it is relatively
Option s Fieldof
business and activity
minor. The limits to discussions and ideas are immediately clear when applying resources and financial capital become the main focus. It serves as a type of selfcensorship: ifit is too big, the idea is abandoned. This open constellation and freedom of development takes pressure off established locations: they are
FIGURE 19_ PROFILE OF WORK AS MOTIVE.
familiar with the routine organization of work in any situation. On the other hand, this lack of routine can also make demands on a particular quality of the crea-
they need to be offset by compensating factors. It is a
tive enterprises: it is free of any formal process ofwork
fairly complex constellation, yet it also offers the oppor-
distribution, and offers the opportunity to mark a prod-
tunity to acquire knowledge and expand the horizon of
uct as one's own, to use the product as a testing ground
experience. It is all very challenging, not very lucrative,
for an individual signature style, and to implement flex-
liberating yet simultaneously limiting. The reasons for
ible forms of collaborating on projects
remaining in the creative scene are ambivalent.
The limitations of resources and infrastructures define
[FIGURE 20].
On the other hand, it is possible to find more sim-
the process. It is enough if the whole remains coherent
ple constellations within and outside creative indus-
within itself-but one should not work at a loss. Yet this
tries: contacts become relaxed because they are able to
is a common occurrence. If a cultural institution offers
separate the work from the private affairs; work is
a prestigious commission, any relationship between
defined within a clear framework and still demands
effort and financial gain are forgotten.
professional expertise; and the pay is distinctly better.
But when calculated earnings drop below of the
the beginning of a job is usually accepting a commis-
wage of an assistant, and the time involved wipes out any distinction between workdays and weekends, or day
sion - but even there it tends to be a zone within which
and night, other options become very promising. With
In the creative enterprises, the point that marks
work is actually begun. The initial phase consists of
such options, there are clear time allocations, function-
deliberations and consultations. Interesting projects
ing work assignments, more substantive resources, and
are discussed with anyone who might have something
the sense ofa product with a clearly recognizable value.
to contribute.
to N
,..;
The product of the creative scene cannot build upon these clear factors. The demands for quality byan established company also payoff-at the same time however, it is more than just the execution ofa contract or a selfdeveloped project. It also represents belonging to the Options Product
creative scene, in that it brings together features of originality and novelty, individualization and signature qualities, and in the process reveals a certain profile that guarantees the satisfaction ofits producers. Should the product lead to a contract and, in turn, an invoice, it would often amount to substantially less than an established company in the branch would have charged - or the figures mask invisible time and effort that seem acceptable only because various types ofcap-
FIGURE 20_ PRODUCTION PROCESS AS MOTIVE.
ital have been amalgamated. This particular approach to calculating has a fun-
product requires it, but then public awareness of that
damental importance ifthe work is taken on by the creative scene. It places high demands on the expertise and
product will be guaranteed. They deliver the expected quality and calculate in such a way that makes the earn-
authority of the creative areas in which professionals
ings accurate. This security is also revealed in how the
work. Consequently, is it a distinct confirmation if the
product and its relevance are presented. In contrast, the effectiveness of promoting a product in
product can be representative ofthe creative scene (Figure 21), together with the possibility ofhoning the profile with additional projects. The confirmation, however, finds its limitation in the specific audience that knows about a product and feels attracted to it. Work by the creative scene requires the support ofmedia in order to grow, and is yet seldom able to organize the occasions that promote a single product. The satisfaction the product offers should now be followed up on byadditional products, by other creative scene professionals, and by the appropriate media
...'" N
the creative scene and on the market is fundamentally unknown. Too many different factors come into play. The social and cultural constellations are such that manufacturers in creative scene must mark their own position and that of their products. They look back to something they have manufactured and now wish to exploit; and they look ahead to something coming ofit, such as projects and contracts. If what they have achieved is recognized, and whether it works as hoped, remains to be seen. The option in creative enterprises is thus: to be
and events. This hope held by people working the creative
flexible, to network, to validate oneselfand one's work,
scene is very different from the security enjoyed by
to create opportunities, and use these in the context of
established enterprises. They need the media only ifthe
additional projects that correspond to one's own style
-
-
-- -- -
----- ---..
-
-
........
-
---
~
--
- - - , . ...
~
......
_~-
- "'--..
_-
- -
--~------r-~-----
- -_... - --
... _ - - - - - -
.~-
-
-
-.
'-' -.---- ----
..
,"
~
r-'
•. ....c:.·
~..;~ ~~ ~:
.~. ~:.
.~--
-..... .-. - . -- -.. - -- - - -. -- . -.--"------ - .... - ...
- - . - . -
.: _-: _
-
••
•
.:}-
-
•
-
- - - -
-
- - - - .
"-
-
~'-
-
-
-
+.
-
-
.
-.. _. -- - - -_. ---
.
.-
/
The image one has of oneself is not a compensation, although it integrates the experiences ofsomeone in the field. Self-images are rough copies (Figure 22). They determine the positioning and orientation that flowinto future work. For professionals in the creative scene, this would imply that, as people, they feel recognized for their own characteristics and qualities and that they, in turn, validate other professionals they come across. Can people working in the creative scene, with all the uncertainty of Optionen Presentation
the financial situation, really believe they are on the right trackwhen everything is so precarious?
FIGURE 21 _ PRODUCT RECE PTION AS M OT IVE.
Those whose expertise is applied outside the creative scene may certainly observe the creative industries with respect, even though it presents a precarious situa-
and individual signature. The option of the established
tion. But it is hardly possible to question one's own suc-
enterprise is not much different in terms of the general
cess ifit corresponds to the prevailing values - ofhaving
details, as they are clearly also interested in validation
made it, being set up and able to plan the future.
and opportunity. The framework and the interests are,
These are obviously cliches. However, they are
however, more defined and more routine. They involve
effective. They follow an individualistic logic that seeks
customer relations, sales-promotion opportunities, and
to make room for individual forms ofworking and liv-
market orientation.
ing, with only vague considerations of social and eco-
In this wayan ideal series ofevents is sketched out
nomic changes. They are models of self-determination
- from production to product to promotion. People
that bring a strange mixture ofconfidence, enthusiasm,
working in the field can now consider what they have
and anxiety to the people who make up the creative
experienced and how things should proceed. Does it
scene, while bringing the others a strange mixture of
make sense to prioritize one's own ideas and projects,
success, conformity, and self-abandonment.
small but special contracts, open exchanges, and the motivation elicited by the latest developments, over the security and tranquility offered by established compa-
THE SPIRAL MODEL: The spiral model developed in
nies for the same demands on know-how?
above and systematizes them, thus showing how the
Figure 23 integrates the motives and options described
This alternative can be formulated in another way
players in creative enterprises attempt to clarify ines-
if it is directed specifically at the self-image of the professionals in the field. It would then involve basic deci-
capable uncertainties in their deliberation of motives and options, without following a linear logic. The form
sions that are not the product ofrational considerations.
of logic in these dealings can be developed from the
cr> N rl
5 .4 .3 VALUE CREATION IN CREATIVE SCENE
The aforementioned considerations show that the professionals in the creative scene develop and stimulate distinctive production , product, and promotion profiles in their specific integration of social, cultural, and
Options Field of business and activity
financial capital. These profiles envelop an expanded concept ofvalue creation. It is in the interest offunding measures to strengthen and use them. After looking at Motive Self-image -
",,-
==7
the spiral model, the main features can be quickly reviewed: OPENNESS AND MOTIVATION:
FIGURE 22_ SELF -IMAGE AS MOTIV E.
the creative scene tests
new living and working forms that present specific considerations: multiple categorization, hybridizing, fields ofactivity instead ofdistinct professions, the close prox-
detailed and comparative readings. It establishes the
imity ofwork and private life. Their work is consequently
differentiation of calculations and deliberations as an
distinguished by the removal of restrictions, a greater
indicator of the creative enterprise. It is impossible to
degree ofopenness in developing tasks and determining
confine them within simple terms. The differentiation of logic behind activities en-
problems, and an additional social and cultural field that presents opportunities for motivation.
ables professionals in the creative scene to compensate for the uncertainties in their overall situation. At the
DEVELOPMENT PRACTICES AND VALUE ORIENTA-
same time it is the prerequisite for a specific form of
TION: The
value creation, which expands beyond traditional
are slower and require less effort, more improvisational
creative scene uses production processes that
notions ofvalue-added . Increasing this creation ofvalue
and conceptual, and which occur in a more complex
is the objective offunding measures, while eliminating
network. From this evolve opportunities for deepened
compensatory calculations to benefit the addition of
thoroughness and sustainability, a new conceptualiza-
different types ofcapital is only a desirable side effect.
tion process, and a complex social and cultural value
An explanation of value creation is provided as a
orientation.
conclusion to this chapter, along with - thanks to the The creative
distinction between types of capital and working with
PROTOTYPES AND DRIVING FORCES:
motives and options - how it can be understood by pro-
scene develops product categories that appear as varia-
fessionals in creative scene.
tions ofwell-known categories or even as new categories - an expression of a position dependent on play, curiosity, and aesthetic and other experiments. They can create new driving forces and prototypes for opportunities and utilization in established fields.
lZl
....ro
Options: Process Project.nd om~,
L -='Commassaons and
ProfessIonal
IIlthange
panlCtpants
_ ~
froml~S ' . lO eqlClsed
Brarctl sklll$
"':R-sou e - ',-.,- - -
Reswusn itIaIm.
Motive in work profile Shor".age oe means
Options: Field of business and activity
Enterprisesand
tnt8l'pJiSltS aflCl
COOl.KtS
QJstom8fS
~te9" l>OO
Btardl
,U,
skills
Adl:Mjon of diffetent rype$ otcapital
Dominance of hnancial taPltal
~'he"""'.
Newlorms of living .wtwtrting
InteQfation
PrOXlmity lOl,J'llV8f-
ESlablisheclJ)fOducts
Iltv. urban sening
andwnprowmen1
EstablIShed products and innovahons
CalctJlation fOf themarket
CalculaliontOl' themarlfl
limiledfeal calcWition
M
" i l ,?" , oonOl CotIerenceWTth P1anability
Profile and net'Wtllting
Motive in product perception
Mooel foequahty 01 sectOt
Compensa,oon calculations
-:--:--:-_
--.,. _ . ~ [ ,peeled QUOhty
FafTII l ~1 framework ~-r-
ProM andirume
Turnover and recogmllOO
D
D
o
o
Creative professions in enterprisesoutSIde Of t!'le aeatrve Indusules
Options: Presentation
The a~tjve indusU.'IIS with establishedentetpflSU
Crutiytscene Prolessionals Sooal capital Culturalcaptal F~ 'c.apj lal
Basic Model
OP' ' ' '. pn,,;dod
MotJ'o'eS. omporcal~
FIGUR E 23- SPIRAL MODEL - OPTIONS AND MOTIVES tN CREATIVE SCENE.
iodMdua '~ ca ~ul.'ed
Options: Product
ATTRACTIVENESS OF LOCATION, NICHE MARKETS:
The creative scene uses promotion and distribution forms that elicit special qualities from straightforwardness, direct responsibility, and verifiable expertise. They produce and create niche markets, limited productions, and single unit productions, and their connection with the local community makes a location attractive. EXPERIMENT AND INNOVATION:
Looking at the crea-
tive scene as an entire system and as a whole reveals how significant a role it plays. In its flexible project contexts and consciously selected "entrepreneurial" freedom, positions, processes, and products are created that in turn have various positive effects on established enterprises. Here, creativity and innovation are very close together. Working methods are oriented toward the principles ofexperimental research or actually redefine them. Because the "market" need not always be studied in its utmost depth, things are realized that would otherwise never make it past the drawing board - and consistently with surprising effects. A simple summary ofthe issues considered is simple: the complexity of the value-added process characteristic ofthe creative scene is made practically invisible by perspectives that are limited to data and figures. Statistically, the creative scene is almost impossible to understand completely. As soon as the view broadens, it becomes clear that it is anything but peripheral. The creative scene responds to the motivations of an everchanging market and transforms them into original forms and compelling driving forces. Such qualities make them a perfect target for sustainable funding measures.
N
ro ....
6.S
THE CREATIVE INDUSTRIES: POLITICAL FIELDS, SPONSORING MECHANISMS, AND SPONSORING OBJECTIVES
Chapter 6 marks the beginning of the section of this
where opportunities can be found for future growth and
publication devoted to measures. It describes the politi-
employment. On the other, the complex of branches is
cal fields [6.1] that are involvedwith the current (international and national) discussion on the complex and
becoming increasingly difficult to access through estab-
multi-layered topic of the creative industries. This is fol-
lished means. The enterprises are generally too small and the constellations of enterprises too atypical for
lowed by a section dealing with potential national bod-
traditional funding bodies. Their value creation proc-
ies [6.2] that could be in the position to support the
esses are too diverse for political economists to find
potential ofthe creative industries. The last section out-
easy arguments to support them; too many interfaces
lines the reasons why this publication suggests specifi-
make it difficult to formulate clearly the responsibilities
cally supporting the creative scene, and how we should
ofa governmental agency.
differentiate between the outside perspective, that of
The list below can only provide an outline of the
defining the creative scene as a sector to finance, and the inside perspective, which attributes ambivalence to
political fields that are beginning to address the creative industries, and which are continuing to indicate the dif-
funding issues [6.3].
ficulties involved in tackling the issue strategically and operatively.
5.1 POLITICAL FIELDS The discussion of specific
funding programs is not as advanced as the more attrac-
ECONOMIC POLICY (EMPLOYMENT POTENTIAL):
tive debate about the dynamic ofthe creative industries.
a few years ago, it was believed that the high-tech
After the many reports on the cultural and creative
branches would generate a high growth dynamic. Tech-
Until
industries, often commissioned by a governmental
nological influences ("spillovers") positively affected
agency for a particular complex of branches, the question "What next?" is increasingly being posed by politicians and economic funding bodies. On the one hand, the creative industries, with their above-average dynamic and their immaterial, innovative features, are a highly interesting partner when searching for an answer to the core question of
other economic branches that were stagnating because oftheir traditional structure. In the 1990S, this function was assigned to the creative industries. The appropriate measures may support the creative industries' economic dynamic, as well as its associated employment potential.
M M ....
INNOVATION POLICY (KNOWLEDGE-BASED ECONOMY):
cation policies long before the Bologna Declaration.
The question of the competitive capacity of enterprises
The relationship between education, economic, and innovation policies affects academic curricula; educa-
or ofentire branches is directly related to their capacity for innovation. The creation of value as well as of new
tion politicians speculate whether the role ofthe educa-
forms of employment is increasingly contingent upon
tional institution in this total structure should be rede-
innovation. Knowledge about the motivation behind
fined. Universities of the arts are considering how to
innovation is essential to economic success, as well as
make their interface with the labor market more active.
knowing which constellations might encourage innovation. Because oftheir inherent immaterial components
CULTURAL POLICY (THREE-SECTOR MARKET 6 3) :
inherent in their name, the creative industries are seen to be a part of this knowledge-based economy. Accord-
creative industries are viewed as a part of the cultural sector as a whole, different interfaces emerge between
ingly,attempts are being made positivelyinfluence these
the three sectors of"the State," "civil society," and "the
Ifthe
economy." The professionals in the creative industries
aspects.
increasingly work with multi-track employment situaREGIONAL POLICY (URBAN AND REGIONAL DEVEL-
tions and are constantly shifting between the three sec-
From the perspec-
tors. Education policy and modern cultural policy are
tive of regional economics, the creative industries play
related in certain areas; yet common interfaces regarding their fields ofactivities are still difficult to find.
OPMENT, STRUCTURAL CHANGE):
an important role in the course ofthe structural change ofthe urban economy. New types ofenterprises are convincing opportunities for politics and the economy to
SOCIAL POLICY (PRECARIOUS WORK RELATIONS):
A
position both cities and region within an international
number ofstudies 04 have concluded that creative indus-
competition for locations. Knowledge of the territorial
tries professionals may well be over-qualified, but they
specificity - unique regional features that are closely related to local conditions and can therefore not be cop-
actually earn comparativelyless because oftheir project-
ied - may lead to a better understanding and organiza-
countries, the social security structure for the creative
tion ofprocesses.
industries is either inadequate or non-existent. A sociopolitically motivated approach to the creative industries addresses ways ofestablishing demand or specific models ofsocial security. This list could be continued; all ofthe policy areas lack specifically developed approaches and share the
EDUCATION
POLICY
(INTERFACE
EDUCATION
-
The labor market aspects ofthe creative industries are increasingly being discussed in the context of universities of the arts. The relationship between the education offuture creative industries proLABOR MARKET):
related and intermittent method of working. In many
need for theoretical foundations.
fessionals and their labor markets was an issue for edu-
63
see: Chapter 3.1.
64
see: BETZELT, SIGRID, Flexible Wissensarbeit, AlleindienstleisterInnen zwischen Privileg und Prekaritat, ZeS Working Paper No. 3/2006, Zentrum fur Sozialpolitik, Universitiit Bremen, 2006 (Center for social policies, Bremen University).
6.2 FUNDING BODIES The creative industries can play
a dynamic role in the different political fields only if they are able to develop their substance accordingly. However, the creative industries' complex or even lacking self-image means it is difficult to find a program that corresponds to their funding requirements. If the inside perspective of the creative industries (which needs have been identified and then indicated?) can be constructively amalgamated with the outside perspective (which funding programs are realistic in line with the respective conditionsi'), a first essential step has been made toward a future-oriented funding program. Funding bodies in Switzerland are in the public, private, or civil society, or the intermediate sectors. These different contexts influence the respective funding strategies. Available resources, institutional foundations, and strategic guidelines can either limit the scope ofaction in a certain situation or expand the possibilities. Standard potential funding bodies are described below, with the overall Swiss context foremost.
Public sector professionals can be assumed to be those in politics and federal agencies. These include:
_Swiss Federal Office of Culture (SFOC): The SFOC organizes cultural and educational structures, supports selected disciplines, and handles various funding commissions. It has a great inJluence on the understanding of culture and public cultural funding. The creative scene can deliberately include its funding praxis orcan distance itselffrom it. _Federal Office for Professional Education and Technology (OPET): The OPET is the centerfor professional education, universities of applied sciences (including universities of art and design) und innovation policies. _ State Secretariatfor Economic Affairs (SECO): SECO describes itselfas afederal centerfor economic policies. It designs economic-political structures to ensure sustainable economic growth. It has agreat influence on the understanding of bus iness in Switzerland as well as the discussion ofwhether the creative industries as a whole, or the creative scene as part ofit, can be seen as a worthfundingfrom an economic perspective. _ Universities of arts and design: These are prominent educational institutionsfor many sub-markets ofthe creative industries; the relationship to professionals in the creative scene is naturally very close. Their curricula are formative of the standard with which the creative industries are evaluated as a labor market for their graduates.
In the intermediate or civil society sector, it is necessary
The private sector can also be subdivided into institu-
to draw a distinction between professionals within and
tions that are either part of or outside of the creative
beyond the creative industries:
industries:
_ As a purpose-oriented coalition, the creative branch associations attempt toformulate and represent profession-specjfic or overridinn political interests. They also support their members nenerally through advice, information, orfurther education proqrums. The anendas they determine whether or not their members see themselves as a sub-market of the creative industries. _ Compared to other countries, Switzerland has a widely developed and professionally ornanized tertiary sector. Other countries admire thefoundations in Switzerland. The amount offundinn available for cultural projects is much higher than in Europe as a whole. Throunh itsfundinn and award practices, the tertiary sector can either include orexclude the creative scene, andthus inJluence the opportunities for development of professionals in the field.
_ Established enterprises in the creative industries shape the imane of this complex of branches with politicalfinures and other decision makers. Whether they see themselves as a part ofthe creative industries, a system thatbenefits from the force ofthe creative scene, or whether they view themselves as representatives of an individual sub-segment, has a direct effect on the sinnjficance ofthe creative scene in public discussions. _ The lendinn practices offinancial institutions can rate the specjficfeatures ofthe creative industries (primary immaterial products and services, little traditionsecurity benefits) as hinh or low. if under certain circumstances the creative industries are niven a hinh-risk status with interestinq opportunities for success, thiswill have a nrwt impact on the sinnjficance ofthe creative scene. There are evidently sufficient reasons to justify funding strategies in each of the three sectors. Calculable success or even results that can barely be quantified can both be a focus. They may be short-, rnid-, or longterm:
Calculableeffects Non-calculableor difficult to calculateeffects
SHORT-TERM SUCCESS PERSPECTIVES
LONG-TERM SUCCESS PERSPECTIVES
For example: turnover For example:innovation potential
For example: valuecreation (esp. material) For example: valuecreation (esp. immaterial)
CHART 29_ TEMPLATE WITH COMPONENTS OF DIFFERENT FUNDING OBJECTIVES AS A BASIS FOR CHOOSING FUNDING BODIES.
00 M
....
6.3 FUNDING THE CREATIVE SCENE?
Chapter 7 will
develop a specific funding model for a particular subsegment of the creative industries, rather than a model for the creative industries as a whole. This method represents the differentiated approach developed here. It may be astonishing at first that we recommend observ-
Taking such a step would be worthwhile, because, as the interplay of empirical-quantitative and theoreticalqualitative approaches showed, the creative scene develops value-added models and processes that possess unique features and distinguish important functions for the creative industries system.
ing not just the established enterprises in the creative
It can thus be shown that the creative scene is a
industries from the financial support perspective, but also the creative scene.
good testing field for new production processes, and that it constructively handles the specific conditions of
For one thing, we have ascertained however that
a new working world, such as dissolving clear boundaries between professions. It has also become clear that
established enterprises in the creative industries increasingly resemble enterprises in other branches in terms of their financing and production mechanisms
the creative scene develops product categories that are
Financing established enterprises in the creative
playful, curious, aesthetic, and experimental, and thus creates new a force for established products and prototypes for follow-up and realization in the established
industries requires not so much the development of
field. The forms of advertising and distributing these
specific measures, but rather an adequate positioning within an existing funding landscape. This is a task for
micro-series and single-unit productions create and serve niche markets, and their local origins make a location attractive.
[SEE CHAPTER 3.1.2].
associations, the relevant community buildings, or professional lobbying. Funding models for established enterprises in the creative industries - mainly through pre-existing funding bodies - are also already available. Yet this is not the case for the creative scene. For reasons mentioned in Chapter 5, this sector has too many differences to the approaches of"classical" financial support measures, and the need for specific funding strategies has already been confirmed.
It is clear that the creative scene playsan important
role in the dynamic and innovation potential of the creative industries as a whole. Its flexible contexts facilitate attitudes, processes, and products that have a positive effect on the established enterprises on various levels. These arguments become all the more significant when considering how the creative scene, according to sub-market, makes up 20 to 50% of all enterprises they are however generally not statistically documented, but nonetheless successful on the market TER 3.2.2].
[SEE CHAP-
For a specific funding model, it is necessary to examine how to strengthen the positive effects that would help the creative scene generate its own development and stabilization, and that of the area of established enterprises, and how the dynamics and ambivalences formulated in the spiral model [SEE CHAPTER 5] can disclose a maximum positive effect. It is important here to remember that both the method of working and the business models ofthe creative scene are deliberate concepts. If, over a more or less long period of time, the professionals in this sector do not desire to develop an established, structured business model, then of course this will have consequences for funding programs.
7.~
RECOMMENDATIONS FOR PROVIDING FINANCIAL SUPPORT TO THE CREATIVE SCENE
The previous chapter concerns itselfwith specific funding models for the creative scene. First an appropriate
vidual small businesses to develop into established
decision-making process is sketched out for potential funding agencies [7.1]. A spiral model is then presented
companies. Should the appraisal of a creative scene turn out positive, then more specific follow-up questions need to
as an overview of possible funding measures, giving a
be answered that are still strategic in nature. Should the
detailed explanation of the creative scene's operational
creative scene be stabilized with the appropriate meas-
logic and presenting the diverse reasons for shifting to
ures or rather expanded? Should corresponding pro-
established areas of the creative industries. The spiral model is made operational in terms ofa funding model
grams be geared primarily toward professionals who remain in the creative scene, or toward those who wish
[7.2]. Next, a specific funding model is developed for the
to leave the it to pursue becoming an established company?
creative scene [7.3] and explained in its various dimensions [7.3.1-7.3.5]. The chapter concludes with a concrete example of the recommended approach to funding [7-4]·
These basic questions have to be answered before a relationship can be established between the inside perspective, namely the need for funding, and the out-
7.1 DECISIONS THAT NEED TO BE MADE BY FUNDING
side perspective, the motivation to fund, and before a discussion about specific funding programs and meas-
BODIES This chapter focuses on developing a specific
ures can be successful.
(business) funding model for the creative scene, which would require a series of strategic decisions on the part
7.2 MAKING THE SPIRAL MODEL OPERATIONAL The
of the funding body. It first has to be confirmed that the creative scene can and should be defined in terms of potential funding, and then, whether it can be classified as eligible for funds. Developing specific funding pro-
spiral model [SEE CHAPTER 5+3] compares reasons in favor of making a shift to become established companies in the creative industries, and those who prefer to remain in the creative scene.
grams for the creative scene involves accepting the fact that it is subject, to some extent, to a different logic than established companies. Hence, supporting their specific business models is as important as assisting indi-
A specific funding model for the creative scene must reinforce the motivation for remaining in the industry by making options clearer and more attractive. The goal must be to support the positive aspects of the
creative scene without necessarily submitting it to the
The model
logic of established companies. In addition, the ambiv-
three identified fields, which are normally conflated. If
alence that professionals in the creative scene experi-
they are separated analytically, however, specific funding measures maybe discussed, particularly for the crea-
[SEE FIGURE 23]
distinguishes between the
ence, because their existence is dictated by the significant need to compensate living and working models, has to be resolved. Yeteven when these measures suc-
tive scene. Explaining the three fields should make this clearer.
ceed, they still do not cover the deficits they are meant to address.
CREATIVE PROFESSIONS The professionals who make
TER 3.1.3 REGARDING THE PRELIMINARY STAGE),
In the funding model developed below [SEE CHAPwe
up the creative industries are those who possess skills in a creative profession. They are musicians, directors,
refer to a differentiation between three types of capital - social, cultural, and financial [SEE CHAPTER 5.3] -
and designers. These skills merge with qualifications that are necessary for the production ofthe appropriate
and translate them into terms that identify points of
products and services. The creative scene also counts social and cultural skills among these qualifications,
contact for funding measures.
DI FFER ENCE BETWEEN OCCUPATIONAL OUALIFIC ATIONS AND BUS I NESS MODEL
.............. .........
'"""" "om",", / ./ / /
"' ' '' '' ' ' '"om"';·····.....•.......•.\ .• susrxsss ncon.s
Ttchnk.al expertise beforesymbolic capital Focus: Crrativiry
CREATI VE SCENE
Technicalexpertise
as symbolic capital
X RULES OF IMPLEMENTATION
Branch enterprises FOCU5: Rerum on investment
1 Micro-enterprises
!
withcompensation
'-'"':::>/''~:::'.~:. ?E'=;~~~"'
.......................
Praxis routines
.. . . .. ~~~~.'.~I.~:~.~l
FIE LDS OF ACTIVITY
FIGU R E 2 4 _ TYP ES O F CAP ITAL AND CONDI TION S IN P RAXIS .
<: RULES OF IMPLEl'lENTATION
Mak-
because it provides only limited resources for its profes-
7.3 A FUNDING MODEL FOR THE CREATIVE SCENE
sionals and offers alternative forms of lifestyle and
ing the spiral model operational is the basis for a funding
work.
model that offers various options for funding bodies. It
Funding in this field is targeted at increasing pro-
explains that none of the existing funding institutions
fessional skills, providing they also lead to an improve-
can identify and respond to all the relevant factors.
ment in practical skills.
Instead, it suggests establishing funding bodies, with structures that are coordinated, decentralized, and
BUSINESS MODELS
Professional skills have nothing to
reflect the project-related nature ofthe creative scene.
do with those necessary for setting up and managing a
The logic behind such a mirroring is simple: the
company. The work of any enterprise includes routines
funding structures must accommodate the structures of
that involve creative work as well as accounting and cli-
praxis. Funding will thus be granted such that compen-
ent relations. Creative professionals only have a limited
satory measures are substituted by addition of types of
role within the enterprise. Yet, in all other areas, the
capital. Because the central unit ofpraxis in the creative
creative industries are no different from other sub-
scene is project-orientated, all measures will support
industries.
project work, even iffrom different perspectives.
Funding in this field is targeted toward the train-
Funding can support ideas that are greater than
ing ofbusiness competencies - be they integrated into a
the limitations micro-enterprises allow. The production
single person or in the form of an elementary work-
of innovative products and services should also receive
sharing model - always with the goal of securing mar-
financial support to help them gain visibility and mar-
ketability.
ketability. Providing funding for forms of media communication is conceivable as well, since these could An enterprise's praxis indicates
open up new channels that would lead away from the
whether or not it belongs to the creative industries.
dependency on the established media market. Develop-
Established companies distinguish themselves with
ing forms of collaboration between micro-enterprises
industry-related products, while the creative scene uses
and established companies in the creative industries
a mixture of ideas, production, product categories, and
could also be funded
FIELDS OF ACTIVITY
[SEE FIGURE 24].
All these steps bring together consultation, net-
media. Funding in this field is targeted toward differenti-
working options, cultural and social legitimization, and
ations in practice, whereby it is liberated from the burden ofcompensatory measures. The creative profession-
demands for skills. Together they establish a network in which coordinated funding bodies can take advantage
als should be able to add their types ofcapital
ofinterdependencies.
URE 8].
[SEE FIG-
In contrast to this model, the recommendations below
More systematically than in the discussions, these areas
are explained pragmatically. This does not mean that
should now be coordinated into a model relationship
they cannot be integrated into a complex funding con-
that reflects the particular orientations of the creative
figuration. Within the framework ofvarious interviews
scene . The purpose would be to ensure that possible
and discussions [SEE APPENDIX CHAPTER 8 .1], an
funding measures respond specifically to the profile of
attempt was made to identify the specific funding needs
the creative enterprise.
of the creative scene . The nature of the arguments involved accepting a certain level ofvagueness. Profes-
7 .3 .1 FINANCING Financing is usually discussed in
sionals in the creative scene fluctuated between admit-
terms ofone's own savings or ofa loan from a close per-
ting that they see themselves as an economic branch,
sonal contact. Credit institutions rarely enter the pic-
and questioning whether there could be any such thing
ture because they cannot or will not grant credit, even in
as economic support measures for them. Even ifthe dis-
modest amounts, to enterprises in the creative scene .
cussion repeatedly touched on the areas of financing,
During discussion it became clear that there is
infrastructure, training and continued education,
great interest in opportunities that disregard standard
access, and intellectual property, there was no system-
forms of security, which a creative enterprise cannot
atic basis to speak of. WORK OUT DIFFERENCE
.. . · · ·~~:A~:~~·~~~~~~~:~~·· · ">. CREATIVE PROFESSIONS
/ ••••••••..•••
BUSINESS MODEL S CREATIVE SCENE
Expandprofesslo~J
competency per
project
. . .... . . .
Develop projectrelated busine models
· · · ·:~ ·~:ag: ·:·:~ ·· · · · · ·
.
with projects
IMPLEMENT AS PROJECT-RELATED
....•....
··
Testproject-related collaboration
~=~~n cr.~~~~~~~.~~~.~.~~~.~:~ FIELDS OF ACTIVITY
FIGURE 2L FUNDING MOD EL.
.
·
IMPLEMENT AS PROJ ECT- RELATED
provide - generally in the form of specific loan repay-
Motivated significantly by the Swiss discussion on the
ment guarantees: funding bodies could assume market-
new Law on the Promotion of Culture, socio-legal con-
determined risks by providing repayable loans for a lim-
siderations were also mentioned, such as socia l security
ited period. A further possibility would be to provide
laws, unemployment assistance, and pension supplements. o. What became apparent, however, was that this
loan guarantees for other creditors. Based on international discussions, tax-related
area was not assigned a very high priority. The reasons
measures should also be addressed - approaches that
may be found in the lack offamiliarity with the materia l
could also be interesting for Switzerland with its decen-
as well as in the confidence of representatives of this
tralized tax system. The European film industry is sup-
industry. If these conclusions are now applied to the
ported by tax relief measures, while other branches are
funding model presented above, the following picture
benefiting from similar models (to the horror of some
ensues:
politicians). In the EU these are considered as government aid and therefore fall under the special regulations for cultural exemptions. Already established in countries such as France, Luxembourg, and Belgium, a similar basis will be discussed in Spain in
2007.
A distinc-
tion needs to be drawn between general tax breaks, tax deductions and shelters, annual income averaging, and decreasing or eliminating sales or value-added taxes.
CREATIVE
CREATIV E
PROFESSIOIiS
PROFESSIOIiS
FIELDS OF ACTIVITY: PRAXIS
.--
BUS IIiESS IlODELS
FI ELDS OF ACTIVITY: PRAXIS
FIGU R E 26 _ Q U ESTION S O F FI NA NC ING AS ATO PI C FO R FUN D ING BODI ES FROM T HE PUB LIC AND PRIVAT E SECT O RS.
65
see also: Report of the SFOC, FSIO and SECO working group, DiesozialeSicherheitder Kulturschaffenden in der Schweiz, Situationund Verbesserungsmoglichkeiten(Socialsecurityfor creativeprofessionals in Switzerland: current situation and potential for improvement,approvedbythe Federal Councilon February28,2007).
The option of temporarily
Financial aspects can affect socio-political conditions,
7 . 3 .2 INFRASTRUCTURE
or be designed to correlate with the financing ofspecific
using spaces in empty buildings and the idea ofcreative
products and services. Corresponding funding meas-
parks (similar to technology parks) were introduced
ures would be applied to the "business model" and
into the discussion by both sides. The focus was on
"praxis" segments.
infrastructures that offer workspace with affordable
Subsequently, a prerequisite for the successful
and flexible rent conditions to small-enterprises in the
implementation of a practical financial model is the
creative industries. In addition , interest was expressed
cooperation between public (e.g. Swiss Federal Office of
in secretarial and administrative services, workshops,
Culture, SFOC and Federal Social Insurance Office,
and networking events."
FSIO) and private professionals (e.g. financial institutions) .
If these conclusions are now applied to the funding model presented above, the following picture ensues:
CREATIYE
CREATIY E
P ROF ESS ION S
PROFESSIONS
FIE LOS OF ACTIYITY : PRAXIS
BUSI NESS 1l0 0 ELS
F IELOS OF ACTIY ITY: PRAXIS
fIGURE 27_ QU ESTI ON S ABOUT INF RASTR UCTUR E AS A TO P IC FO R FU N DI N G AG ENCIES FRO M T HE PU BLIC AND P R IVATE SECTO RS.
••
The Round Foundry Media Centre , Leeds has been named as an example .
Making infrastructure in all its forms available is gener-
addition , they are sla nted for the most part toward
ally based on private initiatives (e.g. private inves to rs).
financi al capital - a characteristic ofspecial im portance
The government is res po ns ible for creat ing favorab le
to the creative scene. However, in a worl d in which the
circ umstances. Training inst itutions with the appro pri-
lack offi nanci al cap ital is com pensated for by sym bolic
ate infrastructure and suitable equipment have th e
capital, crea ti ng business plans does not always add ress
potential to play important roles.
the mos t basic requirements.
Appro priate fun ding measures therefore logically
It was noted in various ways that univers ities of
app ly to the segments "creative professions" and "busi-
arts and design coul d make specific pro posal s from a
ness mo dels." The interface between professional qual-
bett er-in for med position - proposals that wo uld be
ifications an d business mode ls - more specifica lly leav-
geared toward advanced students or to forme r gradu-
ing a university of the arts an d entering the market -
ates . This would create a more explic it interface between
mus t be consi dered very carefully.
this type ofinstitution an d the creative sce ne. A simi lar inte rface has already been called for in the field ofi nfra-
7 . 3 . 4 EDUCATION AND CONTINUED TRAINING
Mostof
those func t ioning in the creative sector know that Swit-
structure. Education includes both the classic imparting of
zerland offers many SME start-up progra ms, start-up
professional ski lls and knowledge about actua l market
in itiatives, and "vent ure labs." Yet it has been criticized
developments. Interfaces between arts education ins titu -
that these programs are often not specific to a cert ai n
tions and the working world can be esta blished via vari-
industr y and are h ighly dependent on techno logy." In
ous professional ass ocia tions or selected com panies.
CREATI VE
CREATIVE
PROFESSIO NS
PROFESSIONS
FI ELDS OF ACTIV I TY: PRAXIS
FIE LOS OF ACTI VIT Y: PRAXIS
FIGU RE 2 8 _ ISSU ES OF EDUC ATIO N AS A CO R E TO P IC O F T HE PUBL IC SECTO R WI TH I M PO RTAN T I N T ER FAC ES TO T HE INT ERM EDI AT E AND P R IVATE SECTORS. ISSUES OF CO NT INU ING EDUC ATION AS A TO P IC FO R FUNDIN G AG EN CI ES IN T HE INT ERM ED IATE AN D PU BU C SECTO RS.
•?
A posit ive example that addresses the specific aspects ofthe creative industries can be found in the Griinder zentrum Kulturwirtschaft Aachen (Founders' center for the cultural industries in Aachen) .
Specific options for continuing education are typically found at educational institutions and focus on topics that are not part ofthe regular course ofstudy. The most
CREATIVE PROFESSIONS
common are strategic and practical approaches to establishing a company. Once again, the main segments are "creative profession" and "business model". Investments in these segments can be understood as an indirect funding of FIELOS OF ACTIV ITV: PRAXIS
praxis. 7.3.4 MARKE T ACCESS This topic included discussions
FIGURE 29_ MARKET ACCESS AS A TOPIC FO R FUN DING AGEN -
concerning instruments that support less the creative
C IES I N T HE I NT ERM ED IAT E AN D PRIVATE SECTORS.
scene's development ofinnovative products, but rather their marketing (internationally). The most attractive appear to be initiatives that enable and simplify com -
An intermediary between the creative scene and est ab-
mercial business dealings. In this context, the UK was
lished market professionals would also be active in the
repeatedly referred to as a model country.·· Specifically regarding Switzerl and, it was discussed
"praxis" segment. This intermediary would also have access to other two segments via important interfaces.
whether a new position with "translation skills" should be created, so as to better access the market. Here, crea-
7.3 .5 INTELLECTUAL PROPERTY
tive scene professionals assumed that the difference
"Managing creativity involves knowing, first, when to
between the creative scene's work and business models
exploit the non-rivalrous nature of ideas a nd, second,
and those of established customers in and beyond the
when to assert intellectual property rights and make
creative industries are so large that their compatibility
one's ideas-as-products rivalrous.v'"
can only be guaranteed with great difficulty. An intermediary between both worlds, on the
This quotation from John Howkins perfectly formul ates the dilemma experienced by professionals in
other hand, to which one can delegate the task of door
the creative scene. The need for systems and consulta-
opener, pathfinder, a nd communicator "wit h the other
tion models appea rs to be increasing - those which
side" was deemed worthy ofinvestigation.
allow the creative approach to ideas, products, and proc-
The issue of market access for creative products
esses to be as lengthy and open as possible, and which
and services relates primarily to the segment of"praxis."
also guarantee a certain a mount of security to those
Measures to improve the creative scene's market access
who are often initially acting from a value-added chain
bring together professionals from all three sectors: poli-
perspective.
tics, professional associations, and established companies.
<2l
....to
••
Indeed . there are many specific exam ples ofwhich we will now provide a sho rt descrip tion OfMO: Creative London is a think ta nk opera ted wit hin a public-private partne rship with large cultu ral age ncies and institutions under the aegis of the London Developmen t Agency. The goal of'Creative Londo n is to remove esse ntial barrie rs that confront the creative industries. Since its establishment in 2004, Creative London has already developed and implemented a num ber ofprograms. T hese include investment and financi ng progra ms. talent su pport projects, promotional measures, and making properties available. The main tasks ofCreative Londo n include managing ten 'creative hubs' - iocalll' anchored initiatives that pull together governmen tal offices, property owners , cultural pro fessional, an d ed ucational ins titutions in order to create a long-term growth and prosperi ty pro gra m. In t999 the au tho rities of'the City ofManchester esta blis hed the Creative Indus tries Developm ent Service ICIDS)as a pro motiona l body, once it was recog nized that developing existing marke ts an d creating new markets were the centra l challenges of the burgeoning creative indus tries . The agency assists in mar ket development and sup plies cultural companies with backgro und information and stra tegic analyses ofselected ind ustries and markets . As one ofits potentia lly mos t impo rta nt promotio nal measures, CI DSdeveloped a series of trade sho ws for marketing cultural business both nationally and internatio nally,
••
1l0 WKINS, JOHN. The Creative Economy: How People Make Moncy from Ideas, Pengu in Books. London
2 001.
CREATIVE PROFESSIONS
-: I
7.4 IN PLACE OF A CONCLUSION : AN EXAMPLE IN BUSINESS MOOE LS
FOUR PHASES Using a hypothetica l example, we can show how the recommended procedure can be specified for Switzerland in four phases:
PHAS E 1 WHAT MUST OCCUR? A suitable
institution formu lates
the intention to define the creative scene as a su bject for FIELOS OF ACTIVITV: PRAXIS
commercial funding. This institution assumes the function of initiating and coordinating.
FIGURE 30_ T HE CO M PLE X O F IN T ELLE CT UAL PROPERTY AS A TO P IC FOR FUN DIN G BODI ES I N THE PUBLI C AND INT ERME-
WHO MUST ACT?
DIATE SECT O RS.
(CTI) would be one possibility. This is a funding body
The Innovation Promotion Agency
for federal innovation and supports the transfer of knowledge and technology between companies and Knowledge about the core aspects of intellectual prop-
universities . The CTI is rooted within a federal office,
erty is critical for most professions within the creative
but works with non-governmental commissions, which
industries. Cautious government and pressure applied
in turn establish contacts with business and science .
by professional associations are responsible for establishing specific conditions regard ing praxis. Nonethe-
WHY WAS THIS ABL E TO OCCUR? The
less, the topic would be appropriate as part of an Mas-
conclusion that it wished to more strongly consider the
ter's curriculum.
creative industries in its funding programs for innova-
The five examples related to the creative scene that
dynamic of this segment. Its content-related and struc-
emerged from discussions and questionnaires demon-
tura l links with universities of the arts and design
strate that a topic-oriented funding focus can clearly be
enable it to decided ly involve the creative scene - in the
assigned to one of the segments of "creative profes-
sense ofa dynamic driving force of the crea tive indus-
sions," "business models," and "praxis," and that the
tries . In particular, it wants to use the innovation poten-
CTI came to the
tion . The main argument is the growth and employment
suggested separation into three groups allows a precise
tia l of the creative enterprise. For this, funding pro-
analysis of the creative scene. It has also been shown
grams and enabling practices in Switzerland must be
that professiona ls from the diffe rent sectors (pu blic,
modified.
private, intermediate) are generally involved in imp lementation, which means that multiple funding bodies have to be merged with corresponding objectives.
M
tn
....
PHASE 2
In its business-political strategies, SECO would absorb current and refined practices already in place in SECO:
WHAT NEEDS TO HAPPEN?
The CTI is aware that work
and business models, particularly those of the creative scene, are different than those ofother industries. Their flexible focus on project-related work and their freedom
other countries.
regarding typical business practices result in proto-
For its method of granting funds, the foundation would take an approach to inno-
types, one-off productions, and limited productions;
vation that is new to Switzerland.
creativity and innovation are closely related while working methods are oriented to the principles of experimental research. The CTI therefore attempts to configure a selection of funding bodies that properly address
GRANTS FOUNDATION:
BUSINESS:
Together with the creative scene, business
would support a complex that at last tangibly coordinates business and art.
these specific conditions.
cn convinces the SFOC, SECO,
CREDIT INSTITUTION: Using a loaning method appropriate to the creative scene, the institution would posi-
the Zurich University of the Arts (zhdk), a prominent
tion itself as a creative bank, profiting economically
grants foundation, an established business with a pro-
from its engagement in the medium term.
fessional corporate social responsibility strategy, and a credit institution to participate as a core group in the
ZHdK:
WHO MUST ACT?
The
funding initiative.
The Zurich University of the Arts would understand its commitment as a necessary expansion ofclas-
WHY WAS THIS ABLE TO OCCUR? Such a grouping takes
sic approaches to education. It would be prepared to offer its students unique, future-oriented programs.
into account the public, private, and intermediate sectors. It enables a broad discussion of various funding considerations with a subsequent focus on the objectives offunding. In addition, addressing the topic of the creative industries is new for most ofthe professionals and can, from a variety of perspectives, have an effect on their own funding strategies. In its cultural funding, the SFOC would directly take into account the artists' biographies and job status. SFOC:
PHASE 3
PHASE 4
WHAT NEEDS TO HAPPEN?
First, prioritized funding
WHAT NEEDS TO HAPPEN?
Focal points for funding
strategies should be determined. In so doing, the lowest
need to be developed, using the issues described above
common denominator between the various professionals needs to be identified: which fields from the abovementioned model should be put at the focus offunding
as sensible points oforientation, with room for more. WHO MUST ACT?
activities? Professions, business models, or the inter-
number ofinstitutions participated up to Phase 3, this
face to the market? Should the creative scene be stabi-
may continue. The zhdk would involve other art education institutions in Switzerland to develop a compre-
lized or made more dynamic? Should the interfaces between the creative enterprise and established businesses be the focus, or should this focus remain within the creative enterprise itself? WHO MUST ACT?
For such discussions ofstrategy, the
If, for reasons of efficiency, a reduced
hensive initial strategy. The foundation could make its newly developed approaches accessible to additional foundations by using the Swiss Foundations as an umbrella. The cn would continue to be responsible for coordination across Switzerland.
C'I'Iassumes a moderating function. It attempts to create a complementary network ofthe various professionals in their various sectors. From their various strategic levels, the different funding agents make personnel resources available. WHY WAS THIS ABLE TO OCCUR? Empirically,strategies
that involve different professionals are comparatively very demanding in the development phase. However, they are more stable once they have been implemented, and also correspond to the basic principles ofSwiss subsidiarity.
to
....to
8.S
APPENDIX
8.1 ABOUT THE INTERVIEWS AND GROUP DISCUS-
SIONS One important source for the statements about
the creative scene was the diverse one-on-one interviews and group discussions held with representatives of the design sector as well as with instructors from various Swiss universities. The information below details the individual occasions, names the participants and briefly notes the topics discussed. The discussions were headed by Manfred Gerig and Christoph Weckerle and were based on qualitative research methods for focus interviews and group discussions." The meetings were coordinated by Robin Haller. The participants were selected on the basis of the following criteria: age, education, professional position, and specific standing in the design field. The discussions were recorded (both visually and acoustically), transcribed, and evaluated through content analysis. The chronological order of the discussions, the participants, and the thematic focus were:
7E1
see: FLICK,
UWE, VON KARDORFF, ERNST, STEINKE, INES,
Qualitative Forschung(Qualitative research), Reinbek2000. Therein:
HOPF,
CHRISTEL, Qualitative Interviews, pp. 349ff, BOHNSACK, RALF, Gruppendiskussion (Group discussion), pp. 369ff; KOWAL, SABINE, O'CONNELL, DANIEL C., ZurTranskription von Gesprachcn (Transcribing conversations); MAYRINK, PHILIP, Qualitative Inhaltsanalyse
(Qualitative content analysis), p. 468.
JANUARY 30, 2006
OCTOBER 2, 2006
1StGroup Discussion with Young Representatives of the
znd Group Discussions with Young Representatives of
Zurich Design Scene
the Zurich Design Sector
_Meret Aebersold, industrial desiqner _Anna Colby, photographer
_IfEbnother, industrial designer _Stephanie Gygax, photographer
_IfEbniither, industrial designer _StephanieGygax, photographer _Max Rheiner, Interaction Design _CarmenWeisskopf, new media _Annina Zust, textile designer
_Robin Haller, graphic artist _Jeannine Herrmann, visual designer _Max Rheiner, interaction design _Annina Ziist, textile designer Focus ofthe Discussion
Focus ofthe Discussion
The terms creativity, creative industries, design Relationship to the market Lifestyles and working methods The significance of education and the presence of the university
_Relationship to the.findings of the group discussions in January and February _ The terms creativity and creative industries _Differentiating the term design _Relationship to the market, entrepreneurial initiative, d~cits
FEBRUARY 6, 2006
_Determination ofllfestyles and workingforms
Group Discussion with Young and More Established Visual Designers
NOVEMBER 20, 2006
_Monika Gold (established one-person business) Martin Ldtscher (established small enterprise with varied workforms)
The instructors interviewed teach in the design field at
Group Discussions with Instructors different Swiss universities
_Alexander Meier (creative scene) _ Sereina Rothenberger (creative scene) _Ruedi Ruegg (established small enterprise with approx. .five employees) _ChristianTobler (established mid-sized business with approx. 20 employees)
_Polly Bertram, Mendrisio _Jurg Boner, Lausanne _Roland Fischbacher, Lucerne
Focus ofthe Discussion
Focus ofthe Discussion
_Relationship to the.findings ofthe initial round of discussions with young designers _Relationship to the market _ Validity ofthe work, products, profession _Importance ofthe education
_Does education prepare onefor the market? _ Whatdistinguishes a successful design graduate? _Should something be changed and, lfso, what?
_Claudia Mareis, Berne _RalfMichel, Director ofthe SDN (Swiss Design Network) _Ruedi Widmer, Zurich
I'-
to
....
ONE-ON-ONE I NTERVIEWS
8.2 BIBLIOGRAPH Y
The one-on-one interviews were held between October
A periodically up-dated bibliography on the subject of
25
and November
21 ,2006
_lfEbnother, industrial designer _Stephanie Gygax, photographer _Robin Haller, graphic artist _Martin Lotscher, publisher _Carmen Weisskopf, media artist _Annina Ziist, textile designer
creative industries (national and international) is available at www.kulturwirtschaft.ch. Financial support:
_ CTI ([he Swiss Innovation Promotion Agency) _ AGS (Art Galleries Association Switzerland) _ IFPI (International Federation ofProducers ofPhD nograms andVideograms, Switzerland) Prior to the interview, participants were sent a question- _ SIA (Swiss Society ofEngineers and Architects) naire , which was then used to determine the structure of _ SBW (Association ofSwiss book traders and publishers) the open interview. The questionnaire and the discus- _ Suisa Foundationfor Music
sions were evaluated together. Priorities :
_Education, occupation, location _Notions ofdesign and style _ Work andftnancial situation _ Work in relation to personal circumstances _ Orientation of one's own work _ Suggestions forimproving and/or changing the situation
<Xl
'"....
EDITORS Christoph Weckerle, Manfred Gerig, Michael Sondermann Zurich University ofthe Arts Research Unit Creative Industries President: Professor Dr. Hans-Peter Schwarz Zurich University ofthe Arts Department ofCultural Analysis Institute for Cultural Studies and Art Education Research Unit Creative Industries Christoph Weckerle P.O. Box 8031 Zurich
CONCEPT AND DESIGN Eclat AG, Erlenbach/Zurich
TYPESETTING Continue, Basel
DIAGRAM AND PORTRAIT DEVELOPMENT Elisabeth Sprenger, Visuelle Kommunikation, Ki1chberg/ZH Translation from German into English: Laura Bruce, Berlin This book is also available in a German language edition, ISBN 978-3-7643-7972-8 Library ofCongress Control Number: 2007934059 Bibliographic information published by the German National Library The German National Library lists this publication in the Deutsche Nationalbibliografie; detailed bibliographic data are available on the Internet at http://dnb.d-nb.de.
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hdk Zurcher Hochschule dar KOnste Zurich Universityof the Arts
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