Describe about the Impact of Entertainment Agencies on UKEconomy ?
The Entertainment industry that is associated with music, television shows and computer games have contributed greatly for the improvement of the overall economy of UK (Borgo et al. 2013). The entertainment industry was solely responsible for 1.7 million jobs in UK which contributed greatly for the improvement of the economy of UK. New reports published on 13th January 2015, shows that UK’s entertainment industry associated with film industry, television industry are now contributing £76.9 billion per year to the economy of the United Kingdom. This contribution in the year 2015 is an all time high which equates to £8.8m per hour or £146,000 per minute (Cunningham and Potts 2015).
The government of UK itself is supporting the entertainment industry because they understood that the entertainment industry is the main source of growth in the country that also drives investment and tourism. The government of UK is also providing tax relief to attract foreign investments. “Create UK strategy” that was published last year clearly indicated that government is all set to work together with the country’s entertainment industry to ensure the continuous economic growth of the country (Thecreativeindustries.co.uk 2016).
Key findings from the statistics released in January 2015 will show how the entertainment industry has helped the UK economy.
The gross value of UK’s entertainment industry was £76.9bn in 2013 and accounted for five percent of the total contribution to UK economy (Gov.uk 2015).
Entertainment industry created near about 1.7m jobs which were 5.6 percent of total UK jobs (Castella and McClatchey 2011)
Entertainment industry exported services worth £13.7bn, 8.8 percent of total UK service exports (Castella and McClatchey 2011).
According to The Creative Industries Council, 2015 was another great year for the entertainment industry of UK. UK is now placed as the leading global hub for the creative industry,. Films and video games that contributed greatly towards the entertainment industry and the economy of the UK are mentioned below:
Films
Avengers: The Age of Ultron (Marvel Studios/ Walt Disney Studios). This was a sequel to 2102’s blockbuster movie Marvel’s The Avengers. The movie grossed a healthy £8.5 million in its and earned a total of £32.3m.
Pan (Warner Brothers). This movie failed to impress UK audiences. However, it earned $1.3m in its opening week.
Hotel Transylvania 2: With a huge opening of £6.32m, this movie claimed the top position in UK box office chart.
Spectre (Sony Pictures Entertainment/MGM/EON): It was the latest installment of the 007 franchise. The movie earned £64m within 14 days in UK market.
Video Games
Batman Arkham Knight: It was the conclusion of the one the most popular game Arkham Trilogy.
Tearaway Unfold- A video game based on 2013’s hugely successful Tearaway story.
Total War: Attila: It was the ninth game in the total war series of video games.
Figure 1: Contribution of entertainment industry in UK economy
(Source: Vogel 2014)
Video games are bigger than Hollywood in UK
According to Daily mirror UK, video game industry has shown unimaginable growth and boosted the economy of UK than Hollywood industry. For example, the first person shooter game Call of Duty: Black Ops 3 has achieved grossed $550m in its opening weekend when Jurassic World managed to gain $512m (Parsons 2015). Another recently released video game Halo 5 managed to trump James Bond in the UK entertainment market. James Bond: Spectre managed to acquire £6.3m on its opening day when Halo 5 pulled £7.7m (Parsons 2015). According to Activision, the developer of Call of Duty series, fans collectively played Black Ops 3 online for 75 million hours.
Music industry
Artists like Sam Smith, Ed Sheeran and Paloma Faith has helped the UK music industry to gain £4.1bn in the year of 2014. The market growth was 5% overall and in 2015 the growth was 2.6%.
Figure 2: Bestselling albums in UK
(Source: BBC News 2016)
Figure 3: Contribution of music industry in UK
(Source: BBC News 2016)
According to research, it has been found that British Broadcasting Corporation (BBC) Trust has increased investment at regional as well as national levels that are directly affecting local level. BBC contributed £40 million to building local TV infrastructure (Gov.uk 2015). BBC’s investment in the UK’s entertainment industry has various economic impacts. The stable funding is a source of stability in the broadcasting industry. BBC is also the single contributor for training within the broadcast industry. The agency stimulates consumer demand for new technological platforms (Gov.uk 2015). BBC also involves in markets by preventing the use of potentially profitable business models. BBC develops and supports new talent, new markets, and technologies. BBC impacts revenues for making businesses profitable. BBC partners with Gaelic Media Service that also provides economic impacts at the local level. The consumer demand is stimulated by technological innovations. BBC also impacts competitive markets through quality benchmarking and creating a skilled talent pool. In this manner, BBC supports local development, local culture and other benefits (Gov.uk 2015).
For the regional level, British Film Institute (BFI) has taken the role and responsibility of distributing lottery money since April 2011 (British Film Institute 2012). The UK film industry has had direct regional impacts. The rate of employment has increased by 7.2% in West Midlands (British Film Institute 2012). The rate of total employment has changed significantly. Film production has been a new source of economic growth in different regions. Another regional funding for development is Northern Film & Media. The funding helps in driving the development of a commercial, competitive, creative and successful reputation. The funding agency does not provide support for music videos, corporate films, short films or adverts (NFM 2016). The Yorkshire Content Fund by Screen Yorkshire has a dramatic impact on various production levels. It attracted big budget international feature films as well as events like Tour de France. These investments impact the overall revenue of UK entertainment and venue industry. Yorkshire also screens various cityscapes such as coast and urban areas that impact tourism industry (Sherwin 2014).
At the national level, Creative England Film Enterprise funds £2m for improving the growth of entertainment and venue businesses outside of Greater London (Creativeengland.co.uk 2016). The agency encourages new business alliances for enhancing international trade. The agency further welcomes applications from companies who can demonstrate their skills and capacities. The Film Enterprise offers various development and support programs to the film-related business by offering recoupable grant, equity, and debt. This fund is used to plan leadership training, business planning and mentoring at the national level (Creativeengland.co.uk 2016). There are other national film agencies such as Creative Scotland, Northern Ireland Screen and various others offer various development opportunities for creativity and film skills development (Weareukfilm.com 2016).
BBC News, 2016. British music industry boosts economy by £4.1bn – BBC News. [online] BBC News. Available at: <https://www.bbc.com/news/entertainment-arts-34722928> [Accessed 25 Mar. 2016].
Bbc.co.uk, 2014. UK’s creative industries beat employment downturn – BBC News. [online] BBC News. Available at: <https://www.bbc.com/news/entertainment-arts-25742231> [Accessed 22 Mar. 2016].
Borgo, M.D., Goodridge, P., Haskel, J. and Pesole, A., 2013. Productivity and Growth in UK Industries: An Intangible Investment Approach*. Oxford Bulletin of Economics and Statistics, 75(6), pp.806-834.
British Film Institute, 2012. The Economic Impact of the UK Film Industry. [online] Available at: <https://www.bfi.org.uk/sites/bfi.org.uk/files/downloads/bfi-economic-impact-of-the-uk-film-industry-2012-09-17.pdf> [Accessed 26 Feb. 2016].
Castella, T. and McClatchey, C., 2011. Whatever happened to full employment? – BBC News. [online] BBC News. Available at: <https://www.bbc.co.uk/news/magazine-15276765> [Accessed 26 Feb. 2016].
Creativeengland.co.uk, 2016. | Creative England. [online] Available at: <https://www.creativeengland.co.uk/film/film-business-support> [Accessed 26 Feb. 2016].
Cunningham, S.D. and Potts, J.D., 2015. Creative industries and the wider economy. The Oxford Handbook of Creative Industries, pp.387-404.
Densham, S., 2016. Creative Industries worth record £84.1bn to UK economy | Ukie. [online] Ukie.org.uk. Available at: <https://ukie.org.uk/news/2016/01/creative-industries-worth-record-%C2%A3841bn-uk-economy> [Accessed 22 Mar. 2016].
Gov.uk, 2015. 2010 to 2015 government policy: media and creative industries – GOV.UK. [online] Available at: <https://www.gov.uk/government/publications/2010-to-2015-government-policy-media-and-creative-industries/2010-to-2015-government-policy-media-and-creative-industries> [Accessed 26 Feb. 2016].
Gov.uk, 2015. Creative Industries now worth £8.8 million an hour to UK economy – Press releases – GOV.UK. [online] Available at: <https://www.gov.uk/government/news/creative-industries-now-worth-88-million-an-hour-to-uk-economy> [Accessed 26 Feb. 2016].
NFM, 2016. Funding ‹ Homepage. [online] Available at: <https://northernmedia.org/funding> [Accessed 26 Feb. 2016].
Parsons, J., 2015. Video games are bigger than movies and here’s the proof. [online] mirror. Available at: <https://www.mirror.co.uk/news/technology-science/technology/video-games-bigger-hollywood-call-6811936> [Accessed 25 Mar. 2016].
Sherwin, A., 2014. Tour de France effect brings Hollywood blockbusters to Yorkshire. [online] The Independent. Available at: <https://www.independent.co.uk/arts-entertainment/films/news/tour-de-france-effect-brings-hollywood-blockbusters-to-yorkshire-9623943.html> [Accessed 26 Feb. 2016].
Thecreativeindustries.co.uk, 2016. Create UK Strategy. [online] Available at: <https://www.thecreativeindustries.co.uk/resources/create-uk-strategy> [Accessed 26 Feb. 2016].
Ukie.org.uk, 2016. The games industry in numbers | Ukie. [online] Ukie.org.uk. Available at: <https://ukie.org.uk/research> [Accessed 22 Mar. 2016].
Vogel, H.L., 2014. Entertainment industry economics: A guide for financial analysis. Cambridge University Press.
Weareukfilm.com, 2016. Film Financing in the UK | UKFilm. [online] Available at: <https://www.weareukfilm.com/financing-in-the-uk> [Accessed 26 Feb. 2016].
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