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You’re reading this because, just like us, you’re tired of the non-stop tech and startup news cycle, where there seems to be something new and trendy to keep up with in Southeast Asia.
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Without further ado, let’s dive in.
Hi readers, Katrina here!
I’m part of a generation that was told, growing up, that we’d have no future in creative pursuits, especially not in this part of the world. My peers and I did not face a future of lucrative jobs in the Western Hemisphere, because we were pursuing degrees in media and communications. And around 10 years ago, when I decided to move back to Asia after a brief stint in the US, I was told I’d doomed my future.
So it feels strange—but also gratifying—to learn that the creative economy is one of the fastest-growing sectors of the global economy, contributing 3% of global GDP and becoming a significant driver of employment. The size of the global creative goods market more than doubled from US$208 billion in 2002 to $509 billion in 2015. Creative industries have thrived since the 2008 economic crisis, and some even claim that they are “recession-proof”.
The miracle story in the industry is China, which increased its creative goods trade more than fivefold from 2002 to 2014. According to the United Nations Conference on Trade and Development (UNCTAD), this surge is largely thanks to growing internet accessibility, a huge consumer base, and a booming digital economy.
That sounds a lot like Southeast Asia, if you ask me.
In fact, ASEAN plus China, Japan, and Korea led the world’s regional economic groups in exporting creative goods from 2002-2015.
We think Southeast Asia could be the world’s next creative powerhouse. But while its diversity makes it a creatively and culturally rich region, it could also be our Achilles heel, driving fragmentation instead of collaboration.
TL;DR:
- Southeast Asia’s creative industries
- The medium is the message: how tech is transforming creative products
- The Catch-22 of scaling creative cultural products
- Creative services following a colonial route
- Opportunities for local creativity
Southeast Asia’s creative industries
Countries around the world have their own set of priorities when it comes to growing their creative industry, which comprises both products and services. Some focus on entertainment—think, for example, Korea’s conscious effort since the 1990s to export its music first to East Asia, then to the Western world.
Singapore’s Creative Industries Development Strategy uses three broad groupings (Arts and Culture, Design and Media), while Indonesia identifies 16 sub-sectors:
Given the various scopes of creative economies, we can look to UNCTAD’s list of categories for a common ground:
- Art crafts
- Audiovisuals
- Design
- Digital fabrication
- New media
- Performing arts
- Publishing
- Visual arts
UNCTAD notes that more than half of creative goods exports in the world come from developing Asian economies. In Southeast Asia, countries are vying to be named the region’s creative leader—Thailand aims to “bring out the creativity in ASEAN”, Malaysia is gunning to be the region’s creative hub, and the Philippines hopes to become the “number one Creative Economy in ASEAN in terms of size and value of our creative industries”.
Meanwhile, Indonesia has its sights set on bigger fish, with the goal of becoming a global creative economy player by 2030. And Singapore positions itself “at the creative cultural crossroads between East and West”, inviting international creative companies to call it their home.
The medium is the message: how tech is transforming creative products
Technology is increasingly shaping the way we create and consume creative content.
For instance, publishers are increasingly reliant on the platform economy, with over 75% of referrals coming from Google and Facebook. This affects editorial decisions—hence the rise of clickbait headlines and “snackable” content, and an increased use of short videos by news outlets.
As a result, the algorithms of search engines and news feeds now influence how content is made. How authoritative and comprehensive an article should be now often depends on Google’s judgment; virality is now a marker of success for many content creators. If in the past, the concern of writers was to make audiences eager enough to turn the page, they now have a different hurdle to face: to make readers so hooked that they’d pay to remove the paywall.
Developing technologies are also expanding the types of creative products we can produce. In Deeper #14, Ebi wrote about the unification of offline and online worlds. Virtual and augmented reality are enabling virtual performers, simulated experiences, and spurring a $172 billion market in Asia-Pacific. Through platforms like Storyhive, created by Singapore-based Hiverlab, businesses, educators, and artists in Southeast Asia can create AR and VR presentations without having to develop the required technology.
Covid-19 could accelerate the adoption of AR and VR to appease an increasing desire to replicate reality from the safety of our own homes. Passport to Success, a Myanmar-based hospitality training company, has rolled out virtual reality training for workers in Southeast Asia.
And speaking of the pandemic, technology has made it possible to consume more content in these trying times. On a global scale, an average of 54% of consumers reported watching more shows on streaming services, 51% viewed more YouTube views, 34% read more books or listened to more audiobooks, 31% spent more time using online learning platforms for themselves, and 16% created more videos.
This global trend is reflected in Southeast Asia’s changing digital consumption during the pandemic:
Many expect to maintain this increased consumption of media content even once the pandemic is over.
Tech is enabling collaboration across the region, too. Again, Covid-19 plays a role in accelerating this trend. Just this month, an album featuring female Southeast Asian artists was released on digital streaming platforms.
Will this taste of collaboration drive more partnerships among the region’s creative industries? Historically, these industries have operated in silos across Southeast Asia. But an increased habit of online content consumption is helping to break down these barriers and drive discovery creative products beyond our national boundaries.
The Catch-22 of scaling creative cultural products
In November last year, Hago, a social gaming app developed by Chinese company YY, held a game development competition in Indonesia with the professed goal of strengthening the country’s gaming industry and creative economy. The winner was awarded 60 million rupiah (S$4,000).
In funding game development, Hago looks to achieve scale by eventually bringing the game to other markets. This makes sense—to get a return on investment, developers need to sell their products beyond their home markets. But according to a regional gaming app company I talked to, localized games tend to gain traction more quickly in some markets.
So there’s the catch: localized products can quickly grow in their markets, but can have difficulty scaling regionally. Designing for a more heterogeneous audience makes scaling easier. But we’ve yet to come up with a formula for exporting our creative products without diluting the cultural characteristics that make them appealing to their local markets.
In our effort to reach global scale, do we risk delocalizing our creative products to appeal to a heterogeneous market? Is such a tradeoff beneficial in the long run?
After all, it takes clout and a lot of time to make a cultural mark even on a regional scale. As mentioned above, Korea’s entertainment scene didn’t rise to global fame in a day (not even in a decade!). Just last year, it solidified its mark on Western music, with the MTV Video Music Awards creating a K-pop category.
To get localized creative products accepted overseas, a country first needs to make its brand known. It’s easier, for instance, to make the “Bali bag” a global trend; people would probably scratch their heads if you try to sell them, say, a “Batam bag”.
Still, technology can help accelerate the sharing and acceptance of creative cultural products. Consider how YouTube and social media made fried rice a global discussion when Malaysian comedian ‘Uncle Roger’ roasted a BBC host for her cooking method. Or how Asian movies are finding new overseas audiences through platforms like Netflix.
Creative services following a colonial route
A significant portion of creative exports by ASEAN countries is made up of creative services—think design, software and app development, animation, video editing, and the like. And while this drives economic growth, it also presents some disadvantages.
For one, a rise in creative services provided through online gig platforms is increasing the “precarity or impermanence of work”, according to Andy Pratt, Professor of Cultural Economy. The gig economy has opened up income streams for professionals in developing countries and helped to decentralize creative work around the world. But at the same time, it’s rife with issues, as gig workers often have no legal protection from non-paying overseas clients. They must also contend with job insecurity and the lack of privileges provided by formal jobs, such as health insurance.
And local creative talent doesn’t always translate into local products. A country may be rich in human resources, but unable to create sustainable markets and exports for their creative products. Thus, it relies on exporting services to create products for other countries.
This problem is evident in the likes of the Philippines, which has no nationally successful game product of its own despite having local studios that have contributed to global best-sellers, such as The Last of Us Part II.
This trend reflects Pratt’s observation that colonial trade networks appear to persist in global creative trade. Latest available data show that 54% of creative goods exports in the Philippines go to the USA, and 58% of Thailand’s exports go to Europe and the USA. In contrast, the bulk of creative goods exports from Indonesia (48%), Malaysia (73%), and Singapore (79%) go to Asia.
The silver lining is that technology has helped in giving local products a platform. In Indonesia, for example, ecommerce platform Moselo is highlighting crafts and services by local artists.
There’s increased awareness of the need to protect local creative players’ copyright, too. Indonesia, for one, is exploring the use of blockchain to protect musicians’ intellectual property.
Opportunities for local creativity
Could Southeast Asia really grow its creative industries to make the region a competitive global player?
If we look at the factors that propelled China’s creative economy to global success, we see them already at play in Southeast Asia.
Rising internet accessibility and booming digital economy? You got it. You can find the world’s most engaged mobile internet users here, contributing to a digital economy that will be worth US$300 billion by 2025, up from US$100 billion in 2019.
A huge consumer base? Check. ASEAN is the world’s third most populous region, representing a large consumer base—60% of the bloc’s GDP comes from domestic consumption. For some countries like Cambodia and the Philippines, the population skews young, making them conducive to the development and adoption of new ideas and trends.
In terms of tech enablement, the region has Singapore, which is ranked as the 9th most creative country in the world by Martin Prosperity Institute. With tech increasingly becoming part and parcel of the way creative products are made, distributed, and consumed, Singapore will play an important role in driving Southeast Asia’s creative economy.
Singapore also has another thing going for it—a business environment conducive to startup development and funding. Financial issues are a major roadblock for players in the creative space. In 2017, roughly 92.37% of creative economy players in Indonesia, whether SMEs or individuals, were self-funded. This lack of financial resources is one reason why 97.36% of these players could only market their products locally.
This is where we can gain strength from acting as a region. Private companies are already coming in to fund competitions and programmes that help fund local creations. Government agencies can also form partnerships, offering funding in exchange for access to talent and consumers. Startups can collaborate to figure out how to localize their products for Southeast Asia’s diverse markets. Tech companies can offer their platforms to enable creative production.
It appears that different pieces of a puzzle have yet to be put together to harness the potential of a Southeast Asian creative economy. That’s understandable—the region is notorious for being a fragmented market due to its sheer diversity. But maybe that’s the key. By transcending these differences and forging a regional identity that still respects local nuances, Southeast Asia could become a creative force the world to recon with. But it’s a long road ahead.
