1. Globalization of the cultural industries Dr. Brett Christophers brett.christophers@kultgeog.uu.se 17 November 2009

2. Today’s lecture 1. Introduction 2. The conventional globalization argument 3. Putting globalization in (its) place 4. Competing centers 5. ‘Runaway’ productions 6. International co-venturing 7. New technologies and distribution patterns

3. The cultural industries and globalization Today we will look at the globalization of what are most often called the ‘cultural industries’ As such, our focus will be on the processes through which these industries have themselves become more internationalized: – The extent to which this internationalization has occurred – Its specific spatial patterns – And its chief economic characteristics (who controls it, who profits from it, etc.) But we should note that the relationship between the cultural industries and globalization is much broader than this For not only have the cultural industries themselves globalized; they have enabled globalization more broadly

4. Key industries Today we will focus on two (interlinked) cultural industries: television and film But these, of course, are not the only cultural industries! Others include music, crafts, design, advertising... And these have globalized too – Albeit to varying extents – And in different ways Hesmondhalgh (2002, pages 193-6) has a useful section on the globalization of popular music

5. The conventional argument about cultural industries’ globalization First of all, we will look at what we can think of as the ‘conventional’ argument about globalization of TV and film – one that emerged mainly in the 1980s and early 1990s This suggested that there were some key characteristics to such globalization: 1. Increasing dominance of US content and US firms in global TV and film markets (i.e. cultural globalization = Americanization) 2. Powerful and increasing concentration of US production activities, both economically (in the hands of a small number of ‘studios’) and geographically (in Hollywood) 3. Readily controllable and thus highly orderly global distribution networks

6. Grounds for modifying – if not (yet) abandoning – this argument We will then look at a series of issues/developments that suggest that this conventional framing of TV/film globalization does not quite tell the whole story: 1. The complex nature of globalization on the ground, in place 2. The emergence of competing international centers of television and film production 3. The increasing trend towards shooting away from Hollywood 4. Increased levels of co-operation between US and non-US producers and distributors of film and television 5. Radical changes in international distribution technologies

7. Today’s lecture 1. Introduction 2. The conventional globalization argument 3. Putting globalization in (its) place 4. Competing centers 5. ‘Runaway’ productions 6. International co-venturing 7. New technologies and distribution patterns

8. US content has increasingly come to dominate global audiovisual markets Television: – The US generated 70% of all global program trade in 2004 (the UK ranked second with 10%; no other individual country had more than 4%) – In the late 1990s, the US accounted for between 60% and 70% of imported programming in Italy, Spain and Sweden; between 70% and 80% in Australia and France; 83% in Japan; and 87% in Germany Film: – 34% of movie tickets sold in Europe in 1985 were to US films – By 1995, this figure had increased to 75% (but with major variations by country: in 1991, US films took 93% of the UK market, but ‘only’ 58% of the French market)

9. A similar trend applies to control of global distribution outlets – especially TV channels Look, for instance, at the 25 channels currently offered by Boxer in Sweden – of the 11 non-Swedish- owned channels, only two (Kanal 9 and Eurosport) are not US-owned

10. US dominance of global markets: political economy explanations (1) Herbert Schiller saw US dominance of global markets as a form of ‘cultural imperialism’ The media, he said, were used by the US government as instruments of empire- building power – and benefitted from all sorts of direct financial and political aid

11. US dominance of global markets: political economy explanations (2) More recent accounts have maintained the emphasis on questions of power, but have been more nuanced Key practices identified: – Harmonization and enforcement of copyright law – Block-booking of theater chains – Hidden subsidies (e.g. tax deductions)

12. US dominance of global markets: economic explanations Economists have argued that US dominance of global markets is a simple question of numbers The US is bigger and more wealthy than other markets And this allows US producers to take bigger risks, and produce more expensive films and television programs – since the costs can be spread over a larger population base Geographer Allen Scott (2005) agrees, saying this: “Hollywood’s long-term ascendancy on world film markets flows in large degree from the advantages that derive from its large base of consumers...”

13. US dominance of global markets: cultural explanations Some authors argue that the US dominates not due to power or market size, but due to the type of films and programs it produces E.g. Scott Olson: the US creates ‘transparent’ texts – narratives whose ‘polysemy’ encourages diverse populations to read them as though they were indigenous

14. US dominance is reinforced through increasing concentration of content production The business of production of films and television in the US is incredibly concentrated: it is dominated by a small number of so-called ‘studios’: NBC Universal, Viacom, Walt Disney, Time Warner, and News Corporation The number of such leading producers has gradually reduced over time through consolidation: from 29 in 1987, to 10 in 1997, and just 5 today (see B Bagdikian, The Media Monopoly) And in television, the concentration goes further, since the studios also own the four leading broadcast networks (CBS, ABC, NBC, Fox)

15. And US film and television production is also concentrated geographically All the studios are based in Hollywood; and up until the 1980s, most shooting of films and television programs took place in Southern California as well Why this geographic concentration? – Face-to-face contact is crucial in production of nonstandardized products – rapid turnover in decision- making networks and in production crews means that managerial coordination is facilitated by agglomeration – Most employment is on short-term contracts: workers therefore remain close to largest potential pool of employment possibilities See especially the work of Susan Christopherson, Michael Storper, and Allen Scott

16. Global distribution is controllable and thus orderly – as seen in, for e.g., geographical windowing 4-5 months later 3-4 months later 2-3 months later 1-2 months later Less than 1 month later First release (22 November 2000) US Canada Italy Taiwan Iceland Norway Belgium France Germany Israel Switzerland UK Hungary Bulgaria Denmark Indonesia Lithuania Bolivia Argentina (8 days) Australia (8 days) New Zealand (2 weeks) Mexico (2 weeks) Russia (3 weeks) Finland (3 weeks) Sweden (3 weeks) Hong Kong (4 weeks) Peru Greece Panama Ecuador Japan Colombia Venezuela Estonia Egypt Kuwait Release sequence for the film Unbreakable

17. Geographical windowing: explanations Why, traditionally, have US films and television programs been made available to non-US audiences weeks, months or even years after US market release? 1. Enables the film/product to build momentum (‘buzz’) from US exhibition, hence minimizing advertising costs in foreign markets 2. Actors cannot be everywhere at once to publicize a new feature film 3. Allows the actual physical print of the film to be reused overseas

18. And finally... The US studios have always sold their international rights – both to television programs and to films – on a strict territory-by-territory basis In other words, a local film distributor in the UK will acquire the right to exhibit a US film in (and only in) the UK... And a local broadcaster in France will acquire the right to air a US program in (and only in) France... Unless the distributor/broadcaster in question explicitly acquires the rights to additional markets

19. Today’s lecture 1. Introduction 2. The conventional globalization argument 3. Putting globalization in (its) place 4. Competing centers 5. ‘Runaway’ productions 6. International co-venturing 7. New technologies and distribution patterns

20. Many critics doubt that US content is as influential globally as the numbers suggest While the statistics suggest high and increasing levels of US-led globalization of TV and film, some critics demur They argue that if one looks in detail at media content and consumption in particular markets, the evidence for globalization is not so clear Hafez (2007) is the most recent to make this case

21. This argument is based on what is actually shown, who watches it, and how they do so First, US content – especially US television programs – can often be domesticated for international consumption – This is most clearly the case with ‘American’ news coverage Second, it is often the case that only selected local audiences actually watch US programs (Hafez refers to a ‘social chasm’ between those in the Arab world who do and do not watch channels such as CNN) And third, globalization (here, the watching of foreign – often American – content) clearly means different things to different people in different places Liebes and Katz (1993) famously demonstrated the ‘active’ nature of audiences, in the shape of the widely varying reception of the US TV series Dallas in different countries

22. But also on the degree of prominence given to US content in international markets While many countries clearly import large quantities of US television programming, such programming is often less prominent than locally-produced programming One reason for this is that US programming will be often be disproportionately acquired by smaller (less watched) channels And often it will be placed outside of the primetime schedule: in New Zealand, for example, where, in 1999 – Local content accounted for 24% of total transmission time across all broadcasters – But just under 40% of cumulative primetime hours

23. Today’s lecture 1. Introduction 2. The conventional globalization argument 3. Putting globalization in (its) place 4. Competing centers 5. ‘Runaway’ productions 6. International co-venturing 7. New technologies and distribution patterns

24. Will the US (and Hollywood) always dominate global TV and film? At least one key author (Jeremy Tunstall) thinks not – indeed, he argues that this dominance has already ended In 1977, he wrote the influential book The Media Are American Thirty years later, he wrote a book called The Media Were American...

25. Who and where are challenging the US in film and TV production? (1) Over the last decade, the UK and the Netherlands have emerged as the main developers and exporters of popular television program formats – Who Wants to be a Millionaire? (Vem vill bli miljonär?) – from the UK – Big Brother (Big Brother Sverige) – from the Netherlands – Pop Idol (Idol) – from the UK – And so on... In 2004, the UK and the Netherlands combined accounted for nearly 50% of all global formatted shows – the UK with 29% and the Netherlands with 19%

26. Who and where are challenging the US in film and TV production? (2) For many years now, Latin American fiction programs – especially telenovelas (soap operas) – have been produced in increasing quantities – Allowing for a significant reduction in reliance on US imports in the countries in question – And also for development of an export trade to over 50 international (including European and US) markets The strongest examples of this have been in Brazil and Mexico, which have their own huge media corporations such as TV Globo and Televisa, using similar business models to the US studios themselves

27. Who and where are challenging the US in film and TV production? (3) Both of the above examples relate to television In film, the key development of the past two decades has been the emergence in India of ‘Bollywood’ as a key alternative source of big- budget films By 1999, India was already by far the world’s largest producer, churning out more than 800 films a year

28. Who and where are challenging the US in film and TV production? (4) And then, of course, there is China Which not only provides much of its own content through its indigenous film and television production industry But which, like Bollywood, is increasingly in the export business – exporting in growing quantities to Japan, Singapore, Malaysia, Taiwan and other Asian markets

29. The result of all this, it is suggested, is that globalization ≠ Americanization Rather, the world is segmented into a series of ‘geolinguistic’ (Sinclair, 1996) or ‘geocultural’ (Hesmondhalgh, 2002) regions – groups of countries sharing – Similar languages and/or cultures – And similar audiovisual product trade profiles Thus, for instance, the predominance of Indian films in the import baskets of Iran, Jordan, Morocco, Romania and others And the strong representation of French films in the imports of Canada (Quebec), Switzerland, Haiti, Lebanon and other francophone territories

30. Today’s lecture 1. Introduction 2. The conventional globalization argument 3. Putting globalization in (its) place 4. Competing centers 5. ‘Runaway’ productions 6. International co-venturing 7. New technologies and distribution patterns

31. If the US is now less dominant globally than it was, so too – within N. America – is Hollywood A lot of what is still regarded as ‘Hollywood product’ is now filmed away from Hollywood itself This trend has been driven by several factors, including: – An increase in the relative costs of filming in California (e.g. higher wages in a unionized workforce) – Technological developments making location shooting easier – Inducements offered for filming in other locations (either out-of-state or indeed away from the US altogether)

32. ‘Hollywood North’ The classic example of this ‘runaway production’ phenomenon has been the growth of Vancouver (in Canada) as a major production base – In television (The X-Files... Battlestar Galactica... Smallville... and many others) – And in film (Scary Movie... Rumble in the Bronx... Juno... Legends of the Fall... Night at the Museum... and more) Hence its nickname of ‘Hollywood North’ This growth has resulted from various local factors: Vancouver’s relative proximity to LA (a 3-hour flight); the fact it is in the same time zone; and major government subsidies

33. Much has been written about this phenomenon... And in geography, see various articles by Neil Coe

34. Less has been written about filming of ‘American’ programs outside N. America New Zealand, for instance, has been the site for shooting not only of major US studio films – Most notably the Lord of the Rings trilogy But also of major US studio TV series, such as: – Hercules: The Legendary Journeys – Xena: Warrior Princess And Australia is another increasingly important base for Hollywood filming – Often fighting it out with NZ (and Vancouver) to see which can offer the more attractive financial inducements

35. Today’s lecture 1. Introduction 2. The conventional globalization argument 3. Putting globalization in (its) place 4. Competing centers 5. ‘Runaway’ productions 6. International co-venturing 7. New technologies and distribution patterns

36. Co-venturing: a different form of globalization? Increasingly, the activities of the Hollywood-based studios are carried out through partnerships with non-US companies, rather than unilaterally This is especially evident in television – more so than in film In television, such partnerships can take a number of different forms – Ranging from long-term, multi-dimensional joint ventures – To individual, program-based co-productions Here we will look at examples of both...

37. The Discovery Channel / BBC JV is a primary example of the former Broadcasts documentary programming in the US and overseas The UK’s leading publicly- owned, public-service broadcaster (c.f. SVT) Formed a long-term joint venture in 1998

38. The BBC-Discovery JV has two main components Co-production of programs for global markets Co-ownership and operation of international channels 160+ countries (including Sweden) – but excluding US Latin America and Portugal

39. Why co-venture? What does each party gain from the deal? The BBC gets...Discovery gets... Access to Discovery’s vast international distribution infrastructure Commercial experience Cash! (paid $175m to produce new programs during the first five years of the deal) BBC brand cachet BBC Natural History Unit film-making specialism

40. Meanwhile, more and more “US shows” are actually international co-productions A co- production by NBC Universal (US) and BSkyB (UK) A co- production by Fox Television (US) and BBC (UK) A co- production by Viacom (US) and BSkyB (UK)

41. Such co-productions have various rationales or drivers Sharing of cost and risk (but therefore also of reward) Access to multiple tax incentives Access to multiple sources of local content funding Competitive advantage in program acquisitions market... and possibly a balancing out of power in international television?

42. Today’s lecture 1. Introduction 2. The conventional globalization argument 3. Putting globalization in (its) place 4. Competing centers 5. ‘Runaway’ productions 6. International co-venturing 7. New technologies and distribution patterns

43. Threats to the ‘orderly’ nature of globalized (US) television and film As noted above, international distribution of US studio films and TV programs has traditionally been characterized by two key features: 1. Rights sold and films/programs distributed/aired on a strict territory-by-territory basis 2. Release/transmission in North America first, and only later in international markets (‘geographical windowing’) But new technologies have impacted on both features over the past decade in particular The key challenges have come from DVD, satellite television, and the Internet

44. What is this a map of?

45. And why is it important? Traditionally, the US studios knew that if they sold the UK rights to a TV program to a UK-based broadcaster, that broadcaster would only be able to broadcast the program in the UK But with satellite television (and, of course, the Internet), this is no longer the case: as the map suggests, the ‘footprints’ of satellites rarely match national borders Hence consumers in one country can now receive signals from broadcasters in other countries They can often be stopped from doing so (smart cards etc) – but only if the broadcaster enforces lock-out...

46. Some broadcasters do not play ball... In the UK, many pubs and clubs show live Premiership football But an annual subscription to UK satellite broadcaster BSkyB (which owns the UK rights) costs about £6,000 Several overseas satellite broadcasters have sought to exploit pubs’ demand for a cheaper source Thus pubs can buy coverage for less than £1,000 from the likes of Nova (Greece) or ART (Morocco) And, ironically, this allows them to show more games!

47. And where broadcasters do try to limit access, they do not always succeed Lots of British people living abroad, for example, subscribe to BSkyB from a UK address (as required), but then use their decoder overseas And in the world of Internet video, stopping ‘out-of- territory’ consumption is even harder Popular US online TV services (e.g. Hulu) are only legally available to US residents... but can be readily accessed through the use of tools that hide one’s IP address

48. The practice of geographical windowing is also increasingly strained For several reasons, it is now harder for Hollywood to ‘hold back’ its content from international markets until months after North American release/airing One reason is DVD: new Hollywood films are rapidly made available worldwide on pirated DVDs before local cinematic release Another reason is the Internet: both films and (especially) TV programs from the US can be downloaded from file sharing networks very soon after their US release/ transmission All of this has led to a ‘narrowing’ of windows...

49. A striking example of this is the series Lost Delay from US to UK transmission Series 1, Episode 1 Series 2, Episode 1 Series 3, Episode 1 Series 3, Episode 22 1 YEAR 7 MONTHS 6 ½ WEEKS 4 DAYS

50. References Bagdikian (2000): The media monopoly 6 th edition Curtin (2007): Playing to the world’s biggest audience: the globalization of Chinese film and TV Hafez (2007): The myth of media globalization Hesmondhalgh (2002): The cultural industries (1 st edition) Kavoori and Punathambekar (2008): Global Bollywood Liebes and Katz (1993): The export of meaning: Cross-cultural readings of ‘Dallas’ Miller et al (2001): Global Hollywood Olson (1999): Hollywood Planet: Global Media and the Competitive Advantage of Narrative Transparency Schiller (1969): Mass communications and American empire Scott (2005): On Hollywood: the place, the industry Sinclair (1996): Culture and Trade: Some Theoretical and Practical Considerations on ‘Cultural Industries’. In Media, Culture and Free Trade: The Impact of NAFTA on Cultural Industries in Canada, Mexico and the United States Tunstall (2007): The media were American