OpenCulture

A meeting this morning with Judy Faraday of the John Lewis archive has prompted me to return to the theme of the economics of Digital Cultural Content. Judy, in partnership with training providers FPM Training, has been working wwith 18 archive services on issues relating to their strategic planning, fundraising and sustainability.

These services, like many others throughout the UK (and indeed internationally) have been funded to digitise their collections. As with so many other parts of the industry, their primary motivation was more to do with the availability of funds than because of a connection to their core organisational mission, or an understanding of the implications of acquiring a huge quantity of new digital material.

And so many of them find themselves in the classic contemporary Catch-22 situation of holding a large number of digital objects on servers, but without the institutional resources or infrastructure to transform them into Digital Assets, and thence to bring them to market in a structured and sustainable way.

Instead of acting as assets, then, these digital collections are a liability - draining resources without either a demonstrable public value return or a direct economic return on this investment. But the problem these institutions face is one faced by commercial-sector organisations all over the world - it costs money to transform something from raw materials into a product which can compete in an economic marketplace. It costs money, in other words, to monetize.

So, what should they do? How does an organisation that is not scaled to be either a broadcaster or a retailer fulfil its core purpose and bring this material to the public in a sustainable way? The answer, it seems to me, lies in aggregation and in public/private partnership.

Aggregation - bringing together resources to satisfy a demand is a classic private-sector way of reducing the net overhead on bringing a product to market and selling it. Our sector is small, tiny in relation to big media and up until now we have focussed on aggregations by criteria (such as administrative regions) that are functionally meaningless to the majority of the potential audience for our material. At our scale, there can really only be an argument for 2-3 points of aggregation and exchange with other industries.

Under the public/private partnership model, our sector can work with partners to establish a meaningful and sustainable exchange of value, even where this value is not necessarily economic. It is simply not feasible or realistic for every instiutiton in the ‘long-tail’ of cultural service provision to operate a commercial image library. Far better, then, to enter into partnerships with commercial providers who can offer both infrastructure and expertise in the marketplace.

But aggregation and partnership in themselves are unlikely to be sufficient. If we really intend to fund a significant proportion of our industry through sui-generis income (and there are many who still maintain that museums, arhives and libraries are simply a public good which shouldn’t be placed under this kind of pressure), then we have to change both our attitude to our collections and our ambitions about the scale of trading activity.

Attitudinally, we have to accept that what is historically important is not the same as what is commercially profitable. We need to start understanding that selecting a commercially-viable subset of our collections for retail doesn’t undermine our core role so much as help us sustain and extend it.

In terms of our ambitions, we have to stop thinking in terms of high-volume, high-cost transactions like image licensing and retail and start thinking about partnerships based on commercial merchandising and joint ventures for product and service development. Selling pictures is hard, as any picture library will tell you. Entering into a partnership to permit the use of your images on greetings cards (a high volume, low-cost transaction) is relatively easy.

And so to the point - based on the last decade of knowledge and understanding, we have to start to understand that our real role in the supply chain of digital content is to quality-manage the raw materials which others can use to bring products to the mass-market, and to be both confident and intelligent about negotiating deals and licenses to control this. And finally, we need to understand that commercial partnerships and use are not the enemy of open access to collections - in fact, they may be the only way of funding it.

This entry was posted on Tuesday, September 1st, 2009 at 12:09 pm and is filed under Business Models. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.