The Intellectual
Property Office (IPO) and Imperial College today published new
estimates of investment in the UK's copyright industries.
When adopted in the National Accounts this adds more than £3
billion to the economy.
Welcoming the announcement Baroness Wilcox, Minister for
Intellectual Property, said:
“This is excellent news not just for the UK economy, but also
because it shows that Government is serious about understanding
and promoting the creative industries.”
The new estimates have been developed over the last year as
part of the IPO's economic research programme to
establish a more accurate picture of intellectual property in the
UK. The study drew on new information provided by the publishing,
music and film industries on their investment in copyrighted work,
which generates long term revenues for the UK.
This new initiative has been a collaborative effort between
the Office for National Statistics (ONS), IPO, Imperial College
and the creative industries. It reflects the increased importance
of intellectual property in today's economy.
The IPO’s Chief Executive, John Alty said:
"Government policy recognises the vital importance
of innovation in the creative sector. It is more important than
ever that we should capture this investment in the way we measure
the economy - adding to the UK’s economic capability.
“We welcome the drive for good evidence and the collaboration
between industry, researchers and Government which has made this
work possible.”
Sarah Faulder, Chief Executive of the Publishers Licensing
Society (PLS) said:
"PLS is delighted to have been able to play a part
in ensuring that the value of the UK's publishing
industry is more accurately reflected in the national statistics.
Whilst we believe there is more work to be done to ensure the
scale of the industry is fully reflected, we commend the IPO for
having undertaken this crucial and challenging task at a time when
copyright policy is under review by the Government."
The new estimates are summarised below, and set out in
‘Updating the Value of UK Copyright Investment’
published by the IPO and Imperial College today at http://www.ipo.gov.uk/ipresearch-year-2012.htm
Summary
The
role of intangible assets in the System of National Accounts (SNA)
reflects the growing role of knowledge investment in firms and the
economy. Software and copyright assets (artistic originals) were
included in the SNA in 1992, and the UK fully reflected the
software change in 2007 [1] . Research and
Development will be included in the SNA, first as a satellite
account, in the next three years, and the ONS has already started
work on the compilation [2] .
This note reports on collaboration between Imperial College,
the ONS, the IPO, and industry sources to improve measurement of
UK investment in artistic originals. Focus was placed on the
creation of long-lived artistic original assets protected by
copyright, as defined by the SNA. These include new broadcast
programmes, books, art, music and films.
Investment is part of final Gross Domestic Product (GDP) and
copyright works are assets that contribute to economic growth, so
the framework to account for copyright investment was developed,
as reported by Goodridge and Haskel in July 2011
[3] .
This update to the work suggests that UK investment in
copyright was approximately £5.1bn in 2009, or £3.2bn higher
(0.3% of Gross Value Added (GVA) higher [4] ) than existing
official data recorded in the UK National Accounts, for the
comparable series on pure copyright investment.
Table 1: UK Investment in
artistic originals, 2009, £m (nominal)
|
|
Total |
Film
|
TV / Radio
|
Books
|
Music |
Misc Art
(2008) |
National Accounts data for 2009 as estimated in the
ONS Blue Book (adjusted for comparability)
|
1,807
|
32 |
1,447
|
152
|
176 |
n/a
|
Estimates
from new methodology and
additional data
|
5,089 |
264
|
2,104
|
1,020 |
1,331
|
370
|
The ONS will evaluate the methodology for artistic original
estimates. Revisions to published data arising from methodological
improvements will be fed into national accounts once changes have
been approved and quality-assured.
One issue to settle before these new estimates can be used in
compiling GDP is the treatment of margins. Broadly speaking,
estimates of investment can be based on either cost or revenues
data. Where investment is based on revenues, the estimates will
implicitly include monopoly rents earned by the owner of the
asset. Where investment is estimated by using cost figures, one
option in copyright valuation is to add a mark-up over the costs
to represent the monopoly rents available from copyright, making
the result conceptually consistent with a revenues-based estimate.
The figures used for Film, TV/Radio and Miscellaneous Art
estimates are all cost-based, and the ONS have traditionally
marked up the total TV/Radio figures to represent the value of
holding monopoly assets, as illustrated in Table 2:
Table 2: Investment Mark-up for
monopoly returns, 2009, £m (optional)
|
|
Total |
Film
|
TV / Radio
|
Books
|
Music |
Misc Art
(2008) |
National Accounts data for 2009
|
1,637
|
0 |
1,637
|
n/a
|
n/a |
0
|
The mark-up approach has not been used for the estimate of
copyright investment so this figure is in addition to the results
from the new methodology. This was done for greater consistency
with official methods for own-account software investment and
R&D. It may be appropriate for the estimation of copyright
protected assets, if the ONS so judges.
The new estimate includes £370m as an estimate of
miscellaneous art. This was uncounted before; the method of
measuring this is still being refined and requires validation.
Notes to editors:
Updating the Value of UK Copyright Investment can be accessed
from: http://www.ipo.gov.uk/ipresearch-year-2012.htmThe
Intellectual Property Office (IPO) is within the Department for
Business, Innovation, and Skills (BIS) and is responsible for the
national framework of Intellectual Property rights, comprising
patents, designs, trade marks and copyright.Its role is to help
manage an IP system that encourages innovation and creativity,
balances the needs of consumers and users, promotes strong and
competitive markets and is the foundation of the knowledge-based
economy.It operates in a national and an international environment
and its work is governed by national and international law,
including various international treaties relating to Intellectual
Property (IP) to which the United Kingdom is a party.For further
information, please contact Veena Mapara:
veena.mapara@bis.gsi.gov.uk; 020 7215 5614.For emergency media
calls out-of-hours please contact the duty press officer at the
Department for Business, Innovation and Skills on +44 (0) 20 7215
3505.BIS's online newsroom contains the latest press
notices, speeches, as well as video and images for download. It
also features an up to date list of BIS press office contacts. See
http://www.bis.gov.uk/newsroom for more information.
[1] Graeme Chamberlin, Tony
Clayton, Shikeb Farooqui, New Measures of UK Private Sector
Software Investment, ONS May 2007, http://www.ons.gov.uk/ons/index.html
[2] Lars Wenzel, Khalid Khan, Peter Evans,
Capitalising Research & Development; towards the new
System of National Accounts, ONS 2009. http://www.palgrave-journals.com/elmr/journal/v3/n9/abs/elmr2009156a.html
[3] Peter Goodridge and Jonathan Haskel.
2011. “Film, Television & Radio, Books, Music and Art: UK
Investment in Artistic Originals.” IPO economics report 3/2011, http://www.ipo.gov.uk/ipresearch-copyinvest-full-201107.pdf
[4] This is a percentage of 2009 GVA (£1,
2565, 932m) from the ONS data series ABML http://www.ons.gov.uk/ons/rel/naa1-rd/united-kingdom-economic-accounts/q3-2011/tsd-united-kingdom-economic-accounts-q3-2011.html
Contacts:
BIS Press Office
bispress.releases@bis.gsi.gov.uk
Veena Mapara
Phone: 020 7215 5614
veena.mapara@bis.gsi.gov.uk