02_The Changing Digital Content Market (ENG)
Market Status
The digital content market is growing steadily. The global digital content market, led by global companies such as Getty Images, Adobe, as well as Facebook, Instagram, and YouTube, was estimated to be $161.9 billion in 2020 and is expected to grow to $367.1 billion by 2027.
With the steady increase in technology for authenticating and protecting intellectual property, more marketplace models are showing up in the market. Also, existing digital content companies that used to cater to the local population are expanding into the global market. With the commercialization of 5G technology and the resulting innovation in the overall IT infrastructure, the digital content market is going through the greatest transformation since its inception. The growth of the contact-free service market has prompted a rapid change in the paradigm of the entire digital content market. Global partnerships of major digital content companies, growing strategic investments, and above all, connectivity and integration leading to market expansion are driving the current digital content market into the future. The development of the digital content industry can be summarized in two aspects.
1) Development of Intellectual Property Related Technology
In the past, digital content used to be considered ‘an asset to be owned and kept.’ This concept has evolved, and digital content is now valued as ‘a shareable and consumable asset’. With this change, the number of content creators producing different types of digital content and the amount of digital content they supply has grown exponentially. Large platforms for digital content have become saturated in this process, creating problems such as pirating and infringement of intellectual property rights. As a result, the overall quality of the digital content market decreased. To provide solutions for these problems, intellectual property-related technologies have developed rapidly.
For example, YouTube developed a technology to prevent intellectual property infringement. They implemented the ‘Content ID’ feature, which grants IDs only to creators who meet their criteria. With this feature, they take reference copies of the content and either send a warning or block the uploading or playback of content when somebody infringes the intellectual property rights of previously uploaded content. They also send an automatically generated Content ID claim to the infringer. However, since this is a method based on the metadata of original content, there is a limit to preventing intellectual property infringement in advance. To this end, YouTube has introduced the ‘Checks’ function, which checks for copyright infringement before the content is published so that the content uploader can be warned before uploading it. Anybody who uploads a video on YouTube must go through the Checks page before the content is finally posted.
ARTPRESTO, a company based in Japan, is operating the ‘Picture Alpha’ business, which utilizes digital watermarking technology. Also, a U.S.-based company Intertrust developed the Secure Rights Management Protection technology that protects the intellectual property of digital content regardless of its distribution chain. As such, the intellectual property businesses that offer brokerage, protection, and registration services have also grown significantly. Leading companies around the world are investing huge amounts of capital and resources to grow the digital content market, and the evolving intellectual property laws in countries like Germany and the United States also indicate a huge growth of the intellectual property industry. The rise of interest in intellectual property protection, as well as the technological developments in this sector, are playing huge roles in advancing the digital content industry.
2) The Change in Intellectual Property Awareness
How we perceive intellectual property rights has changed according to the times and societal changes. With the advent of printing, the way we communicate and deliver knowledge changed. What used to be done orally was now done through texts. This created a clear division between content creators and readers, and the creative and informative texts written by creators existed in their own form, separate from both writer and the readers. In this process, printed materials have been recognized for their exchange value in the market, and the intellectual property rights law was created to guarantee the rights of the content creators. This gave the creators the right to be paid for their creativity and ideas, and a new concept of “exclusive possession of knowledge” took place.
However, with the dawn of the digital age, copyright issues related to reproduction rights have arisen, and these issues have complicated the concept of intellectual property. The possibility of unlimited duplication of content has become a threat to the concept of exclusive ownership of content, and it completely changed the way information is distributed. Content began to spread through the Internet as it was passed on from people to people, and “relationship” in the digital content space emerged as a new topic. In this situation, the conflict between copyright and copyleft over digital content intensified. Nevertheless, such a transition caused by digital reproduction was able to shine a positive light on the market.
While this was happening, the size of the digital content market continued to grow, and the world became more aware of the various problems caused by content reproduction. More people started to recognize the value of excellent digital content and the importance of fair rewards for content creators. In addition, rather than violating the copyrights of digital content, people have begun to create parody content and meme of original content, which directly or indirectly gave credit to the original content creators and supported them financially. The rise in the awareness of intellectual property rights has enabled a virtuous cycle where content creators who create digital contents that are consumed by many people take greater profits than creators who do not, which in turn motivates the content creators to produce high-quality content.
Problems To Be Solved
Despite the remarkable growth of the digital content industry, policies and regulations that are disadvantageous to content creators and many other technological/cultural factors are delaying further development of the industry. Everybody wishes to create and own more and better content, but there are still many limitations to qualitative and quantitative content creation. Large content platforms are undervaluing the works of content creators who deserve higher recognition and fair payment. “Trash Contents” created through illegal activities such as hacking and duplication are not being screened and are being sold in the market. There are three main causes to these problems in the digital content ecosystem:
1) Copyright Infringement
Because digital content can be copied in large quantities and can be easily distributed through the network, creative works of individuals are indiscriminately copied, and digital products of corporations are illegally reproduced and distributed. This not only infringes on the rights of the creators and demotivates creativity, but it also hinders the growth of the digital content industry as a whole. In 2020, it was reported that there are 258 illegal websites that distribute pirated webtoon (digital comic) content in South Korea. According to Korea Creative Content Agency, this is costing the webtoon industry about 1.86 trillion KRW.
The ambiguous nature of content copyright and ownership is also problematic. Many content creators work individually, uploading their creative works such as photographs and writings on various digital content platforms. While the content creators should have all the rights to their original contents, most platform services are free to use these contents for marketing and commercial purposes in the name of “use of services and data.”
2) Unfair Revenue Distribution
The current revenue distribution structure of the digital content industry is centered around the distributors rather than the content creators. This is enabling the large content platform companies that are monopolizing the market to distribute profits to content creators unfairly.
For example, Spotify pays a copyright fee of $20 per person, and YouTube pays a creator less than $0.70. Social media platforms such as Facebook and Instagram do not distribute any profits to individual creators, although these platforms are built upon the creative works of individuals.
3) ConsumerInconvenience
Copyright can be applied to many different activities surrounding creative work, such as reproduction, distribution, rental, broadcasting, and performance. There is a wide range of license combinations depending on the conditions of the use of individual copyrights, and consumers who purchase or consume digital content need to understand the various forms of copyright information. Consumers need to be fully aware of this information before they consume content. Following elements are included in “copyright information”:
This means that consumers must take in a huge amount of information to consume one digital content, and because it feels complicated and overwhelming, many consumers either avoid using the content altogether or opt for illegal ways of consuming the content. Also, even if a consumer purchased digital content, this doesn’t mean that the consumer gets to exclusively own that content. What the consumer is paying for is the license to use the content. The consumer cannot resell the license and cannot take any action if the copyright holder or the service provider unilaterally suspends the right to use the content.
