With commitment and the right investment, the digital media industries in Scotland can achieve long-term, sustainable growth and make a significantly increased contribution to the Scottish economy.
Our target is to double the value of sector revenues to £6.3bn by 2012. In developing this target, we have considered the likely growth of the sector if we do nothing – a ‘base case scenario’. Recent work by NESTA7 estimates that the creative industries (of which digital media is a subset) will grow by an average of 4% per annum to £85bn by 2013, taking account of the current recession.
We know that Scotland accounts for approximately 7% of the UK creative industries, and that digital media accounts for approximately 65% of the Scottish creative industries8. On this basis, the base case scenario is for the Scottish digital media sector to be worth approximately £3.8bn by 2012.
To achieve our target of doubling sector revenues to £6.3bn by 2012, we need to drive up growth rates in the sector to 15% from 2008 to 2010 and then again to 20% for 2011-2012. This is the ‘if we realise our ambitions’ scenario shown on the opposite page. In practice, this means is that the actions we take must support the creation of an additional £2.47bn in revenues for the sector between now and 2012.
This is a deliberately ambitious target, but one that we believe is achievable if the actions contained here are realised. Breaking down this target requires further work, and the Digital Media Advisory Group will continue to develop appropriate measures to track the progress of the strategy. We expect that these will include more specific targets relating to:Increasing the Number of Companies
Digital media is a new and emerging sector, and it is important that Scotland has diversity and scale within its company base. Growth in this sector is as much about growing the number of companies as it is about increasing employment in existing businesses. It is worth reasserting that digital media will not grow through a few scaled companies and corporate aggregation but through diverse success and scale.Increasing the Number of Companies of Scale
A vibrant and successful digital media industry needs a mix of large and small businesses operating across supply chains. Larger businesses can be both important sources of investment and key routes into global markets, as well as anchoring talent in Scotland.Moving Companies Up The Value Chain
The successful growth of Scotland’s digital media industry will depend on our ability to move up the value chain. This means:
This will translate into increased value creation within companies and higher rates of productivity, leading to increased revenues and profits.Increasing Employment
We expect that some of the growth achieved will be jobless growth, at least initially. However, over the medium to longer term, we expect employment in the sector to rise as Scotland’s digital media companies expand their markets.Growing Our Reputation
Reputation is critical to success in digital media. Peer recognition for creativity as well as international reputation for innovative business solutions are both valid and important goals. Reputation in digital media is not purely about scale and turnover. It can be via smaller companies
working to the highest standards of excellence and delivery, reflected in everything from awards, to new and renewed contracts. Sometimes Scotland can be too shy and can be hyper-critical about its own achievements, it’s a luxury we cannot afford going forward, and there are too many good stories to only tell them to ourselves. Growing our reputation for quality and business success is not just about a warm-glow, it will lead to increased private investment in the sector and growth in inward investment. They are both equally important and will be key measures of success.