How can the creative industries innovate using digital technology, and what opportunities does such innovation hold?

Key findings: 

• The UK’s creative industries, particularly live performance organisations, need to look at new business models. Trials and experiments are needed to mitigate the risks involved. 
• Nesta’s research suggests an appetite for live cultural experiences.
• Digital innovation has helped the National Theatre (NT) to reach new audiences. It can be a source of new theatrical experiences: audiences familiar with theatre are keen to see it in a new medium (i.e. transmitted live to cinema screen).
• Better knowledge about what works with audiences in digital innovation is crucial for the success of the UK’s creative industries.

The UK has in recent years undergone a digital revolution. New technologies such as digital TV, music downloads and online games are ripping up established business models. Last year, the UK became the first major economy where advertisers spent more on internet advertising than on TV advertising.

Nesta has been conducting an in-depth research study on the two NT Live pilots that were broadcast last year - Phèdre on 25th June and All's Well That Ends Well on 1st October. The research shows how this innovation has allowed the National to reach new audiences for theatre, not least by drawing on established relationships between cinemas and their patrons all over the country. 

It confirms the centrality of 'live' for the audience experience - both in the theatre and in cinemas. Cinema audiences report even higher levels of emotional engagement with the production than audiences at the theatre. They also claim that they are now more likely to visit the theatre in the future, suggesting that there may be positive spillovers on the wider sector.

Authors

Hasan Bakhshi, Juan Mateos-Garcia of Nesta and David Throsby, Professor of Economics, Macquarie University.