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Media and Entertainment 2016 Top Markets Report Media and Entertainment A Market Assessment Tool for U.S. Exporters October 2016 U.S. Department of Commerce | International Trade Administration | Industry & Analysis (I&A) Industry & Analysis’ (I&A) staff of industry, trade and economic analysts devise and implement international trade, investment, and export promotion strategies that strengthen the global competitiveness of U.S. industries. These initiatives unlock export, and investment opportunities for U.S. businesses by combining in- depth quantitative and qualitative analysis with ITA’s industry relationships. For more information, visit www.trade.gov/industry I&A is part of the International Trade Administration, whose mission is to create prosperity by strengthening the competitiveness of U.S. industry, promoting trade and investment, and ensuring fair trade and compliance with trade laws and agreements. Andrea DaSilva served as lead author of this report. A note of thanks goes to Presidential Management Fellow Blake Murray for his research contributions. Additional thanks is extended to the leadership team in the Office of Digital Services Industries and the Deputy Assistant Secretary for Services, as well as the extended ITA review team at Commercial Service Posts and in Washington, DC. The majority of the industry data sourced in this report comes from the PriceWaterhouseCoopers Global Entertainment & Media Outlook (2015 - 2019). Special thanks to Matthew Lieberman, PwCTechnology, Infocomm, Media and Entertainment Marketing Leader for his support. Table of Contents Executive Summary ........................................................................................................................................... 3 Overview and Key Findings .......................................................................................................................... 5 Country Case Studies Brazil............................................................................................................................................................ 19 Canada ......................................................................................................................................................... 25 China ............................................................................................................................................................ 29 Germany ..................................................................................................................................................... 35 India ............................................................................................................................................................. 41 Mexico ......................................................................................................................................................... 47 United Kingdom ....................................................................................................................................... 53 The Trans-Pacific Partnership (TPP) .............................................................................................. 59 Nordic Region........................................................................................................................................... 65 Sector Snapshots Filmed Entertainment ........................................................................................................................... 71 Music............................................................................................................................................................ 73 Video Games ............................................................................................................................................. 77 Publishing .................................................................................................................................................. 81 Addendum: Resources for U.S. Exporters ............................................................................................ 85 Appendices Appendix 1: Industry Trade Associations, Resources, and Sector Definitions ................ 87 Appendix 2: Top Markets Media and Entertainment Exports 2010 - 2014 ...................... 90 Appendix 3: About ODSI & Global Media & Entertainment Team ........................................ 91 Appendix 4: Citations ............................................................................................................................ 92 2016 ITA Media and Entertainment Top Markets Report 1 This Page Intentionally Left Blank 2016 ITA Media and Entertainment Top Markets Report 2 Executive Summary The 2016 Top Markets Report for Media & Entertainment provides a review of seven global licensing and export markets and two regions across four broad sectors: book publishing, filmed entertainment, music, and video games. This report was compiled through consultations with key industry stakeholders, meticulous analysis of known trade data and economic indicators, leading industry research, as well as trade and regulatory and policy environments across more than 25 countries. The author devised a complex methodology to test the robustness of each market, and then narrowed the list of markets down to the top seven. Of the top seven markets, the UK ranked first, followed by China, Canada, India, Brazil, Mexico and Germany. As the research was conducted prior to the “Brexit” decision, the report may need revisions as we learn more about the impact of this major event. These seven markets can generally be segmented into two main groupings. One segment would be described as established trading partners with a strong local M&E industry and with stable economies which support growth prospects for these sectors. The second segment is composed of emerging markets with extremely high growth rates in multiple sectors, yet the markets contain a good level of risk. The report also includes an assessment of regional trading markets for the M&E sectors. The Nordic overview, including Denmark, Finland, Norway and Sweden, shows a dynamic digital region with pockets of opportunities, albeit smaller markets when compared to the top seven. In light of the Trans-Pacific Partnership (TPP) negotiations, the report reviews prominent TPP markets, including Australia, Canada, Chile, Japan, Malaysia, New Zealand, Mexico, Peru, Singapore, the United States, and Vietnam, and highlights opportunities in both the emerging and more established economies. The regional overview also describes how U.S. exporters and licensors in the creative industries can expand their global presence. The media and entertainment sectors are simultaneously benefitting from and being challenged by digital tools and platforms. On the one hand, it is easier than ever before to produce, distribute and consume content, and the technology behind these sectors is truly revolutionizing how we live in the 21st Century. The policies and regulations governing these sectors are struggling to keep pace and remain relevant, and many governments are protecting their markets. Consumers want more content faster, easier and cheaper – and some are taking it for free. Industry leaders are looking at ways to offer interesting and relevant content to different demographics, while respecting copyrights, privacy and local laws. Producers are identifying platforms and revenue streams for monetizing the demand to the maximum extent possible. Most of the countries studied in this report, including the United States, are reviewing copyright and IP (Intellectual Property) law as well as technology and telecommunications regulations that affect the Internet and digital economy. In trade policy terms, The United States remains the most liberal audio-visual market, and Americans are known for their entrepreneurial spirit and strengths in the creative sectors. Yet many U.S. businesses are not taking advantage of opportunities for overseas expansion. The M&E report aims to stimulate thinking and activity in the private sector about trade opportunities, job creation, and the U.S.’ unique contributions to culture. The report also expands awareness of how U.S. law makers and government export promotion services can be a partner in identifying new or extended opportunities to licensing and exporting creative content and related products. The report does not cover every single aspect of trade for these sectors. In some instances, parts of a sector are only briefly discussed due to current expertise, focus or bandwidth of ITA’s client services. As this is just a starting point for the discussion, the authors welcome feedback on this report. 2016 ITA Media and Entertainment Top Markets Report 3 This Page Intentionally Left Blank 2016 ITA Media and Entertainment Top Markets Report 4 Overview and Key Findings This is the second with streaming content, music and audio recordings, edition of the Media broadcast, radio, book publishing, and video games. and Entertainment Top Markets Report that U.S. Media & Entertainment Landscape projects export and licensing opportunities As a marketplace, the United States is larger than through 2019 in seven Asia, Europe, Latin America or the Middle East‐North countries – Brazil, Africa for media and entertainment.1 The U.S. M&E Canada, China, industry is concentrated on the two coasts: in the Germany, India, Mexico and the United Kingdom – greater Los Angeles community and in New York and two additional trading regions. This edition
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