DYNAMICS OF COPYRIGHTS

How can such low average profitability be reconciled with the tremendous popularity of movies, animations and other copyright-based entertainments? To answer this question requires an assessment of the dynamics of copyright markets, noting in particular: The long chain of intermediaries linking creation with consumption, each deducting their costs and profits before the remainder is passed on. The copyright market resembles a bunch of champagne glasses that are stacked in a pyramid and champagne is poured into the topmost glass, corresponding to the retailer, which must be filled before any champagne bubbles over to the next level, corresponding to the distributor, which in turn must fill, and so on down the pyramid, until the remainder trickles down to the bottom tier, corresponding to the creator. The zero-pricing of entertainment products in the main, free-to-air television markets, which are fully funded by third-party advertisers, so that consumers 'pay' only by their attention to the advertising messages buried inside the content stream. The equation here is a trade-off, whereby consumers accept their second, third or n-th preferences in return for free entertainment. This system has no other basis than the historical incapacity of broadcast media to collect payments directly from consumers. Global Animation Industry Page 5 1 The market power of the ruling intermediaries, the handful of brand name broadcasters and distributors who dominate the world market for content by their control of the broadcast spectrum and retail 'shelfspace'. Globally, there are perhaps five or six corporations which between them command 70-80 per cent of the main media markets; locally, their power is further concentrated by the regulated scarcity of 'bandwidth', so that a matrix of international media power would show a cross-linked and vertically-integrated network of interests.