The Cultural Sector Needs Support in Order to Benefit from a Digital Remake

By Ricard Gil

The COVID-19 crisis has dealt a massive blow to the cultural and creative sectors in Canada and around the world. The impact was broad and deep.

In 2020, museums were closed for an average of more than 155 days, and in 2021, many of them had to shut their doors again, resulting in a 70 per cent drop in attendance.

The film industry, which relies heavily on box office revenue, has seen most theatrical releases cancelled or delayed. The crisis shook the book publishing industry, putting smaller publishers at risk and delaying the launch of several new books and literary works. Music festivals, concerts and plays were forced online, delayed or cancelled and many artists had to find other work.

When these sectors hurt, Canada hurts.

Creative industries have long been one of the leading drivers of innovation and economic growth in this country, making up almost three per cent of the GDP. By promoting social inclusion and social capital, the cultural sector is a key contributor to well-being as well. Our culture drives our identity as community and as country.

Just above survival level

The pandemic has exposed the structural fragility of the businesses and people foundational to supporting the cultural and creative sectors.

For the most part, these are small businesses, non-profit organizations like art centres, fairs, festivals, museums or theaters and independent artists and creative professionals like writers, painters or musicians — many who are operating just above survival level.

The pandemic has removed their main sources of revenue but has not diminished their costs of creation. If they go under, they may never recover. This would create a long-lasting dent in the production of cultural content in Canada.

A video by The Wall Street Journal about how k-pop is reinventing virtual concerts.

Even though the federal and provincial governments have implemented support policies for organizations and professionals affected by the pandemic, the measures have not adapted to the new reality.

Supports also appear to be poorly targeted and fail to account for the medium- and long-term impact of digital transformation on how we produce and consume cultural products and experiences.

For many arts institutions and creative professionals, continued survival and relevance will hinge on how well they can transition from in-person to digital. Doing so will build their resilience to face future shocks and offer an economical pathway to reach larger audiences.

Supply and demand

In the near future, emerging technologies such as virtual and augmented reality have the potential to fuel new types of cultural experiences that can be marketed not only to large audiences but also to new audiences who were not consuming the cultural content before.

In economic terms, digitalization has affected both the demand and supply for cultural content. Thanks to increasingly sophisticated technology and the adoption of digital devices to experience things remote because of the pandemic, consumers have developed a taste for new ways to “tour” museums, “attend” theatre and participate in book readings.

For culture producers, this has forced them to re-imagine not only what and how they create but also their business methods, distribution channels, advertising and funding.

Digitalization of cultural experiences

The digitalization of cultural experiences takes many shapes and forms: musicians streaming concerts when live concerts aren’t possible, museums providing online tours or online book releases with authors reading from their homes.

The pandemic forced cultural producers to think about how they might transition the delivery of their cultural content from in-person to digital in ways that wouldn’t diminish the experience of cultural consumers.

The Met takes you on a virtual tour of Making The Met, 1870–2020.

Digitalization has affected competition as well, in cross-cutting ways. It has lowered the cost of starting a new culture-based enterprises, which should spur competition. But it has also led to greater concentration among those who are able to adapt to the digital world, adding to the decade-long trend of increased market concentration in cinemas, radio, television and the press.

Greater market concentration usually leads to higher prices and poorer quality, with serious long-term consequences for access and diversity of content — that is the most worrisome.

Access to culture and the guarantee of respect to one’s culture are not only rights explicitly recognized by the Universal Declaration of Human Rights and promoted by the United Nations and UNESCO, but they are quintessential to our identity as a community and country.

Policy interventions

Given the importance of access to culture, public policy interventions must aim to support the digitalization of cultural experiences as one way to help face the uncertainty of the future.

Even in stable times, governments have struggled to adapt their policies to the nontraditional business models that mark the cultural sector. That needs to change.

The form of measures and aid provided can vary but two objectives must be prioritized.

One, the aid must help to guarantee the survival of companies and organizations, employees and artists who make access to culture possible. Cultural producers — particularly those that are small and independent — will need help to build their digital skills.

And two, looking to the future, the aid must be competition-neutral — business and organizations must not be favoured over others — to ensure lively innovation by new entrants. If necessary, anti-competition law should be applied to avoid abusive practices that reduce access to culture.

With the fulfilment of both conditions, we can emerge from this crisis a culturally stronger and more forward-looking and resilient country than before.

This article was originally published in The Conversation on 17 March 2022. It can be accessed here:

About the Author

Ricard GilRicard Gil is an Associate Professor and Distinguished Faculty Fellow of Business Economics at the Smith School of Business of Queen’s University. He specializes in organizational economics with a focus on industrial organization, strategy and applied microeconomics.

The views expressed in this article are those of the authors and do not necessarily reflect the views or policies of The Political Anthropologist.