1

HEROBC INNOVATION AND REGIONAL FELLOWSHIPS

(HIRF)


Creative Cluster Formation.
Longitudinal and Contemporary Perspectives
on the East Midlands.

Final Report *

By

John F. Wilson
Paul Bracken
Ekaterina Kostova

Nottingham University Business School,
Jubilee Campus,
Wollaton Rd.,
Nottingham,
NG8 1BB
0115-846-7405
j.wilson@nottingham.ac.uk





* We would like to thank the Innovation and Regional Fellowship scheme,
Nottingham City Council and Nottingham University Business School for funding
this project. In producing this Final Report, while the bulk of the research and
writing has been done by the three Nottingham academics, we also willingly
acknowledge the enormous assistance provided by our project manager, Lisa
Mooney-Smith, who helped us to sustain momentum. Our co-researchers at
InnovationOnline, Paul Anderson and Gaynor Backhouse, provided invaluable
support, while in addition key members of the critical partnership - Serena
Lindsay (Nottingham City Council), Suzanne Alizart (EM-Media), Chris Ward-
Brown (EMDA) and Fred Brooks (Comedia) - advised us consistently on ways of
unravelling the intricacies associated with the creative industries. Frank Abbott
and Jim Shorthose of Nottingham Trent University also provided invaluable
insights into the creative industries. Finally, we would like to thank all those who
either agreed to be interviewed or provided supporting evidence. While all errors
or misinterpretations naturally remain our responsibility, we could never have
achieved as much without this considerable help.
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1. Introduction.

Over the course of the last decade, and especially since the formation in 1997 of a
government ministry with a specific brief to encourage cultural activities, interest in
and research into the creative industries has been increasing enormously. Of course,
Britain has a rich cultural and creative history that stretches back many centuries, an
asset that has been extensively exploited as a means of extending the tourism and
heritage industries. By the 1990s, however, amidst claims that the global economy
had entered The Age of Creativity,
1
extensive interest was being shown in this sector.
While there is still considerable debate about definitions and coverage, it has
nevertheless become apparent that the creative industries are a significant component
within the British socio-economic system. As a direct result of this realisation, not
only were national surveys and analyses conducted, but also regional investigations
were initiated as a means of gaining greater understanding of how this sector emerged
and what policies are required if it is to be further developed. As the Prime Minster
acknowledged in his foreword to the DCMS 2001 green paper

Culture and Creativity:
The Next Ten Years: this Government knows that culture and creativity matter ...
because they enrich all our lives, and everyone deserves the opportunity to develop
their own creative talents.
2

It was in this context that the current project was planned, bringing together a
group of academics, IT experts, practitioners and policy-makers in a unique
partnership capable of pursuing both real-time research and helping to formulate
strategies aimed at boosting Nottinghams creative sector. Furthermore, while this
Report represents the end of the first stage of our work, plans have already been
formulated to pursue further research and build on the distinctive partnership that has
been so effectively moulded together over the last twelve months.
While we have set ourselves these highly ambitious goals, it is important to
stress that the first stage of our work has been limited to two of Nottinghams key
creative clusters, Music and Digital Media. At the same time, in focusing on the issue
of clustering it has been possible to utilise some highly innovative methodologies that
provide detailed insights into the longitudinal and contemporary states of these sub-
sectors. Above all, though, it has been possible to forge a distinctive partnership that
includes: Nottingham University Business School (NUBS), Innovation Online, the
City of Nottingham Council (Development and Environmental Services with Leisure
and Community Services), EM-Media, Comedia, the East Midlands Development
Agency (EMDA) and the Arts Council (East Midlands). This partnership possesses
enormous potential, in that by meeting and discussing issues regularly, fresh and
dynamic ideas have been injected into the research. In this Final Report, we shall
attempt to crystallise the state of this research and present findings that will feed
directly into policy-making across the region.
The Report will start by outlining the nature of this HIRF project and
describing the talents collected together in a multi-faceted team. This will be followed
by a brief description of the recent work on both the creative industries and clustering.
It is important to note that we shall not be attempting to replicate the detailed
mapping investigations conducted by the DCMS, Comedia, Nottingham Trent
University or other national and regional bodies; rather, we shall use this material as
background to our research and analysis. On the other hand, Chapter 3 will

1
John Kao, The Age of Creativity, Nomura Institute 1998. Kao argues that this is the fourth Age, the
world having passed through the Agricultural, Industrial and Information ages.
2
See Lewis and Thompson, Access to music, which treats these ideas more fully.
3
demonstrate that we shall be intensely interested in the subject of clustering, applying
some novel methodologies to analyse the raw data and questioning the very nature of
this form of activity. In the first place, we shall employ a life-cycle model of cluster
development that provides detailed insights into the historical and real-time needs of
the sectors studied. In addition, it will also be possible to apply both a resource-based
view of the firm to the raw data, as well as resource dependency theory, providing
alternative conceptual means of assessing the needs of creative sectors. Thirdly, we
shall be examining the nature of clustering in the creative industries, begging
important questions about the universal applicability of a policy that does now
necessarily serve the needs of all parts of the economy. Following the detailed reports
on the two sub-sectors identified, detailed conclusions and recommendations will then
be drawn up, feeding directly into the policy-making process by outlining a strategy
for future development. While one must inevitably qualify these conclusions and
recommendations by noting that we have only investigated two sub-sectors in one
city, it is vital to stress that this is merely the first stage in an on-going research
programme that will be extended considerably, both sectorally and geographically,
over the course of the next two years.
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2. Project Aims and Research Team.

When our proposals were submitted to HEROBC, we explained that the project was
intended to:

Explore the potential in the regional partnership and develop closer links
between research methodology and partner practice. The focus will be on
analysing cluster formation and the strategic importance to regional strategy
and policy development of these regional economic units.
Demonstrate how higher education can contribute directly to the elaboration of
local and regional policies associated with both the creative industries and
clustering generally.
Create a cluster development model that will explore both generic and specific
target cluster groups whilst addressing the longer-term and contemporary
perspectives.
Use Nottingham as a case study within the main body of research to amplify
and define its regional positioning on cluster development in the target groups.
Explore two of Nottinghams sub-sectoral strengths in the creative industries,
namely, music and digital media.
Engage with Small to Medium Enterprise through hosting a virtual web
community for discourse, publication and debate.
Include an analysis of IP and commercialisation in creative cluster formation
in the Nottingham case study.
Produce both Interim and Final Reports on the research project.

Arising out of our research and further deliberation on these issues, it is also
apparent that in view of the evidence generated from the digital media and music
sectors, one must begin to question both the nature of clustering and whether the
strategy of encouraging this form of activity across the East Midlands is entirely
appropriate to the creative industries. In the first place, by concentrating on the
cluster, the problems of individual firms can be subsumed into generalised
solutions to specific problems. After all, not every firm will not fall neatly into the
cluster model, whether longitudinal or current, indicating how more nuanced
approaches need to be developed as a means of sponsoring the creative industries.


In working towards these ends, we assembled a team that possesses a range of skills:

- John Wilson (NUBS), the team leader who has written extensively on clusters
and networks
3

- Dr. Paul Bracken (research assistant), historian and part-time professional
musician with extensive contacts in the Nottingham music community

3
He has recently published [with Andrew Popp] Clusters and Networks in English Industrial Districts,
1750-1970 (Ashgate, 2003, pp.xii + 288), as well as various articles on this topic.
5
- Ekaterina Kostova (research assistant), an MBA with sound knowledge of
research methods
- Paul Anderson and Gaynor Backhouse (InnovationOnline), who have
established the Virtual Community known as CReEM and arranged focus
groups composed of practitioners from the two sub-sectors.

The project has been robustly and energetically co-ordinated by Lisa Mooney-Smith,
a Development Officer in the Humanities Research Centre of the University of
Nottingham. Lisa has provided both the essential link across the various parties
involved, as well as a dynamic leadership that has ensured regular progress. It is
consequently clear that in future work her contribution should be factored into any
proposal.
Apart from the academic and IT teams, crucially we have been able to collect
together an advisory committee composed of what have been designated critical
partners. This committee has proved vital in guiding the research through its various
stages, as well as in some cases (Nottingham City Council) providing essential funds
to support the work. The principal critical partners have been:

- Serena Lindsay, an economic development officer for the creative industries
at Nottingham City Council
- Suzanne Alizart, business development officer at EM-Media
- Chris Ward-Brown, creative industries development officer at EMDA
- Fred Brookes, a partner in Comedia and manager of the Creative Advantage
Fund.
4


More recently, Tina Smith from the East Midlands Arts Council has joined the
committee, while Frank Abbott and Jim Shorthose from Nottingham Trent
University have also started collaborating with the research team and sharing their
immense knowledge of the local creative community.
5

The principal purpose of this committee has been to advise and guide the
research team, applying the considerable range of experience accumulated from their
past and present work to prompt questions, mediate with potential interviewees and
discuss the research findings. This has proved invaluable in fulfilling the first two
aims outlined earlier, in that not only has a robust regional partnership been forged
which will be capable of taking this work even further, but also it is apparent from
this collaboration that higher education can work in partnership with the key
agencies in helping to fashion future strategies.
Building on this generic issue, we would also like to go on and claim that for
the creative industries to develop in a way which is truly beneficial to the entire
community, or to realize some of the potential of the creative arts as an instrument of
growth, prosperity and social change, the involvement of the academic community,
and especially Higher Education (HE), in this process surely needs to be greater than
at present. Looking at the East Midlands specifically, it is clear that the academic
community is in a strong position to offer specific research capabilities, marketing
skills and a strategic overview to the creative industries, providing exactly the kind of
resources that SMEs frequently lack. Consequently, close liaison between creative

4
The Creative Advantage Fund is a venture capital firm that distributes 1.3 million to support firms in
the West Midlands creative sector.
5
The Nottingham Trent team, formerly headed by Professor Colin Mercer, has been responsible for
several authoritative investigations into the Nottingham creative industries, including
6
industries and the researchers in HE institutions must form an essential backbone in
the future development of specialized skills, expertise and resources. Furthermore, HE
has the additional advantage of looking objectively from outside the cluster of
creative businesses when making strategic suggestions. Indeed, this study highlights
some of the problems which hinder the cluster and its development, but lie beyond its
direct control: some are related to funding changes in relation to Arts provision at
national level and to large-scale national demographic patterns, although others seem
to be a matter for regional planners and development officers.
There is a growing awareness within HE that the involvement of creative
business practitioners in curriculum design, in course evaluation and even in research
direction, should be long-term aims of such collaborations between HE and creative
industries. Conversely, the needs and niche opportunities within the creative
industries, and the ways in which such businesses often use technology in novel ways
as a vehicle for creativity, are beginning to break down the traditional boundaries
between academic subject disciplines, and to reveal some of the ways in which both
academic research can be used commercially and to inform policy-making. This is a
uniquely productive interface, which has already yielded some commercial products
derived from academic research in areas such as music and the humanities.
6

In short, HE needs to respond to these developments through its research
agenda, specifically through the nature of its appointments and teaching, in order to
meet the needs of the sector in the future. Crucially, it should be involving scholars
from a variety of research disciplines in order to encourage collaboration and achieve
the necessary changes. At the moment, however, HE remains constrained by
conventional disciplinary compartmentalization, a trend reinforced by the Research
Assessment Exercise (RAE). Many HE staff are still uncertain how interdisciplinary
collaboration with creative industries will be regarded in terms of the RAE. The RAE
has not recognized work of this type historically, and so researchers could be taking a
considerable risk with their future career development. Furthermore, there seems to be
a problem in terms of resources: for example, the proportion of AHRB funding
allocated to Art and Design, as opposed to the Humanities, is relatively small. This
imbalance needs to be addressed, highlighting one way in which local politicians and
development officers can become involved in the process of funding research that
feeds directly into creative arts development at the strategic level.

6
For a discussion of aspects of the current market conditions and examples of humanities projects
which have generated marketable products, see Bracken Quality Issues and Cultural Tourism: the
changing role of reconstructions and musical performances, Proceedings of the De Haan Tourism and
Management Conference, II (2003) forthcoming.
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3. The Creative Industries.

While greater clarity is beginning to emerge as a result of the recent surge in research
into the creative industries, a major constraint on this work has been an inability to
define and identify categorically what was meant by such a term. As the Comedia
report noted as recently as 2001:

The creative industries are elusive. Definition is controversial, the application
of existing classifications is uncertain, many parts of the creative industries are
characterised by self-employment, freelance working and multi-skilling, and
so practitioners are hard to pin down or to classify. Some would actively resist
classification

There has also been confusion over the interchangeabilty of terms like creative and
cultural, reflecting the difficulties associated with classifying this industry. One
might even argue that creativity is an asset and activity that is ubiquitous across the
economy and society; it is a generic role that converts knowledge into value.
7
Indeed,
given the emphasis on value-added as the principal component in achieving greater
competitiveness, it is increasingly vital to differentiate ones product from rivals
through design, innovation and effective marketing. The management literature is also
replete with references to the learning organization,
8
indicating how firms at every
level are being encouraged to develop a distinctiveness based on imaginative
adaptation.
Stepping back from this confusion over terminology, we shall throughout this
report adopt the definition provided by the DCMSs Creative Industries Task Force
(1998):

Those activities which have their origin in individual
creativity, skill and talent and which have a potential for
wealth and job creation through the generation and
exploitation of intellectual property.

On this basis, the Task Force went on to identify thirteen sectors that have
become the focus of policy and much of the last five years of research. These
are:

advertising, architecture, the art and antiques market, crafts, design,
designer fashion, film, interactive leisure software, music, performing
arts, publishing, software, television and radio. The Task Force also
noted the close economic inter-relationship with other sectors,
including tourism, hospitality, museums and galleries and the
heritage sector.

This definitional work has since provided the basis for a series of mapping exercises
that have played a significant role in determining the pattern of policy-making.
Having identified the key sectors, it is then essential that we understand the
nature of the creative industries. In this context, it is useful to refer to the work of

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Wood (1999).
8
See
8
Pratt (1997), who has argued that when talking about the creative industries one can
differentiate between four main phases of production:

Content origination
Manufacturing inputs
Reproduction
Exchange.

As this represents what Porter (1990) would describe as the value chain,
incorporating everything from inspiration and innovation through to manufacture and
retail, one might argue that simply concentrating on Content Origination might
cause confusion. On the one hand, as Wood (1999) claims: For the creative
industries, production is R&D they are the classic learning industry. This
indicates the vital importance of the creative industries in providing a developmental
model for all other sectors in the economy, given the central role of innovation to
improving performance. On the other hand, as the Comedia report (2001) inquired:

Should the definition reflect only those activities which are directly and
immediately creative and no more, or should the approach be a more holistic
one which represents the chain from conception to consumption, where the
creative element is an essential link, without which the whole chain of links
would not exist?

This is an especially moot point when one comes to consider the music sector,
because as we shall illustrate later music retailers in Nottingham play a central role in
the cluster, acting in a wide range of ways to facilitate communication across the
community.
Arising from this discussion, it is important to stress that we will be following
the nuanced definition offered in the Comedia Report (2001):

We include any direct creative activity in which individual creativity
and skill is brought to bear, and which is characterised by innovation
and originality and leads to the creation of intellectual property in the
form of copyright; such as creating a design, image or text, and acting
in the role of editor or producer.
We include any linked chains of activities which are necessary to the
exploitation of the creative input and which would not exist in the same
form without it; such as the upstream creation of the specific tools,
technologies and techniques which enable creative activity to happen,
like cameras and sound equipment, and the downstream activities
which turn a design, text or image into a marketed product, like
printing and marketing books, reproducing and presenting films.
We exclude any related economic activities which though connected
with the chains that are linked to the creative input, are not dependent
upon it, and would exist in much the same form without it; such as
property, transport, manufacture of computers and multi-purpose
technologies.

While this might not suit those who prefer neat sound-bite definitions and punchy
abbreviations, it is a reflection of the complications associated with examining the
9
creative industries that it is necessary to produce such a qualified definition. Judging
from some of the more informed research into Nottinghams creative industries, one
should also stress how this exercise only goes part way towards understanding the
nature of creative activity.
The principal purposes of recent mapping exercises and economic impact
studies on the creative industries have been to provide invaluable information on their
extent and help to direct policy and funding decisions. However, while this has
proved useful to the politicians and civil servants at various levels, inevitably in
ignoring the true character of this sector the work can be misleading. Several
authorities (Ormerod, 1998; Johnson & Thomas, 2001; Madden, 2001) have pointed
to the failure of economic impact studies accurately to reflect the extent of multiplier
effects associated with the creative industries, undermining any comparative work
with other industries. Above all, as Shorthose (2002) argues, these exercises fail to
accommodate vital characteristics of the creative sector, what motivates those
involved and the nature of employment. Of course, it is important to generate data on
the thousands of firms and one-person operations that populate the creative industries,
especially in the context of an increased level of public auditing and greater concern
with public subsidies and grants. Crucially, though, one must grasp the subtleties
associated with this sector, and especially what Shorthose calls the creative ecology
of inter-dependent working and cultural relationships.
While Shorthose was not the first to introduce this issue the Comedia Report
(2001) noted that a significant proportion of people working in the creative industries
are involved in self-employment, freelance working or multi-skilling - his detailed
research into the dynamics of Nottinghams Lace Market provides a crucial insight
into the sectors character and modus operandi. While more will be said about the
Lace market at later stages in this report, it is important to note how it is composed of
approximately 200 businesses, the bulk of which employ less than five people, and
often only a single person. Yet to focus on employment data is to ignore what actually
happens on a day-to-day basis, because the Lace Market is best described as

a creative ecology of mutually supportive interactions made up of fragile
networks of creative links and partnerships forming informal and unstructured
creative relationships between independent artists, micro-businesses and more
orthodox aspects of the cultural economy. These relationships are intermittent,
irregular, informal and not based on contractual arrangements Creative
production often happens in an unplanned, haphazard and flexible way.

This reveals the essential importance of loosely-based networking and personal
interaction, alongside the transmission of intangible skills and knowledge that is the
lifeblood of creative individuals. It is also apparent that this creative ecology is
hidden from the official classification work conducted by (national, regional or local)
government agencies, given the transitory nature of projects, groups and events. As
many individuals are not even registered as a business, and even earn most of their
income from other activities, this also introduces the role played by not just part-time
freelancers, but also what officially would be classified as amateurs in driving the
creative industries forward.
Building on this nuanced insight into the creative industries, it is consequently
possible to produce a series of categories in which most of the people connected with
this sector can be accommodated. These are:

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1. National Corporate: firms that operate across the creative industries,
either as producers, distributors or retailers (or in more than one role).
While linked to local activities, they are managed and financed from
outside the region, giving them a different set of operating criteria and
management structure. Turnover: multi-million pounds.
2. National Public: bodies that are funded by the taxpayer and distribute
resources nationally and regionally. Turnover: millions
3. Regional Semi-Public: organisations that are set up mostly with
public funds to stimulate local or regional creative industries.
Turnover: up to several million pounds.
4. Local Corporate: firms that originate and are totally embedded in the
local creative industry(ies). These might be venture capital firms,
manufacturers, performers or retailers. Turnover: from 50,000 to 2-3
millions.
5. Local Independents: mostly individuals who work predominantly in
the creative industries. Turnover: up to 50,000.
6. Local Amateurs: mostly individuals who float in and out of the
creative industries on an itinerant basis, earning most of their income
from other occupations.

This is not to say that all of these categories apply to every one of the thirteen creative
industries identified by the DCMS, because in certain sectors the link between
national and local activity can be extremely vague. On the other hand, noting the
existence of such distinctions can provide a much more intimate understanding of the
extensive overlapping that occurs in many creative industries, and especially the
fleeting nature of corporate, public and personal interactions on a variety of levels and
directions.
This all-too-brief analysis of a burgeoning literature on creative industries has
provided vital insights into the principal subjects of our research. While one must
always be wary of any sectors claims to uniqueness or separate treatment, it is clear
that the creative industries possess characteristics that differ markedly with many
other parts of the economy. In particular, given what Shorthose (2002) has revealed,
not only do employment practices in the creative industries defy official classification
techniques, but also the essentially amorphous nature of creative activity leads to, and
is dependent upon, inherent flexibility and fluidity. Furthermore, the primary purpose
of creative activity is not always linked to commercial aims, complicating matters
even more. As such, the sector provides an ideal subject of research for those
interested in the dynamics of clustering and networking activities, even if any
conclusions drawn from that research would not be entirely applicable to comparative
analysis with more conventional parts of the economy.
In conclusion, though, we must stress that the highly complicated, even
unconventional, character of the creative industries must never be used by
politicians or other policy-makers as a reason for ignoring its undoubted needs. As
this report will make clear, there are many ways in which the local, regional and
national institutional structures can be diverted to assist the further development of
the creative industries, making it imperative that these bodies should listen carefully
to the practitioners and researchers who have helped compile the recommendations.
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4. Project Methodology and Analytical Techniques.

4.1 Data Generation.

In embarking on this research, we initially decided that the most effective way of
generating detailed insights into the creative industries was to talk to the people
involved directly in the sectors identified. In the first place, as we stressed in section
2, this involved the creation of a critical partnership composed of representatives
from the most important bodies linked directly to the creative industries. This critical
partnership has acted as the guide to our academic research, providing funds,
prompting questions, opening doors that might otherwise have been closed, and
generally ensuring that a real-time approach was embedded into the analysis.
Secondly, rather than either undertake a mapping exercise or conduct
anonymous telephone surveys, it was regarded as essential that face-to-face
interviews should be arranged with a reasonable range of practitioners in the two
sectors (Music and Digital Media) that we chose as case-studies. A questionnaire was
consequently devised (see Appendix A) that would act as the basis for a conversation
between the two research assistants (Dr. Paul Bracken and Ekaterina Kostova) and
those who responded to our request for an interview. We then identified the kind of
people we would like to meet, including what have been classified as the key change
agents in Nottinghams creative industries. These included:

- Company founders, owners and senior personnel
- Senior management at bodies like COMEDIA, EM-Media and
- Individuals responsible for the creative industries within Nottingham City
Council, EMDA and the County Council
- Staff at the DCMS and DTI
- Chamber of Commerce staff
- Academics at the University of Nottingham, Nottingham Trent University and
New College
- Staff at other East Midlands universities and colleges who have worked in
this and related fields

As Appendices C and D illustrate, this brief was fulfilled as extensively as possible,
bearing in mind the time constraints imposed by the relatively small amount of
funding at out disposal.
9
A total of ninety-five interviews (forty-one in digital media
and fifty-four in music) were conducted on this basis, bringing in a reasonable
proportion of the Nottingham firms and individuals who are linked to these sectors.
The interviews were also backed up by further investigative work into the creative
industries, while in the case of Dr. Bracken his personal experience as a musician and
musical entrepreneur added considerably to the quality of the insights that were
generated.
10

The third methodological technique employed has been based on the projects
relationship with InnovationOnline. As one of the original partners responsible for
making a bid to HEROBC for funds to support this project, InnovationOnline has
been central to the achievement of our aim to link directly with the broad community.

9
Dr. Bracken was only employed for six months on the project, while Ekaterina Kostova worked for
four days per week as Dr. Wilsons research assistant between February and October.
10
Dr. Bracken has recently established his own company, Lector Studiosis, that records and markets
CDs for a niche market in Late-Medieval music and song.
12
Their role, and especially that of Paul Anderson and Gaynor Backhouse, has been to
develop a Virtual Community (VC) as a complement to the interviews and other
research which will engage both regional groups and individual firms in a meaningful
dialogue about clustering and networking. To place this in a broader context, the
University has extensive experience of the formation of virtual and standard networks
through InnovationOnline and with their previous project, Technology Transfer
Network. The web site, known by the acronym CReEM, was launched in September
2003, providing an essential feature of our proactive approach.
The formation of viable and vibrant communities is difficult and requires a
considerable amount of groundwork. It needs to be driven from the grass roots
upwards. To form a new VC, it is essential to work with existing 'leaders' within the
target groups and undertake a pre-marketing phase. This took the form of focus
groups, the target members of which felt that they were involved from the beginning
in their community as much as possible. This has also been seed-corned by placing
relevant editorial material on creative publications and starting a debate about how
this VC could help them. In this case, one of the key attractions has been that they can
be involved in driving cluster policy, rather than simply being the subject of it. They
would also work with existing creative clusters such as Nottinghams Second
Wednesday and CRIB, both of which are linked closely into the InnovationOnline
work. There is also the new EMDA-sponsored web site www.shoutout.info to assist
further in circulating views about the issues. The proposed community would be an
adjunct to these existing activities, rather than mere replication.

4.2 Definitional Issues and Analytical Models.

Having described the manner in which we generated the qualitative material
that forms the basis of our report, it is also important to introduce the definitional
issues and analytical techniques that have been employed to produce clear
recommendations. The first approach is based on the development of a model of
cluster development that is distinct from current work in the field. While the
inspiration for this model was the work of Swann (1998) on life-cycles of cluster
development, as a result of extensive research into English industrial districts this has
been extended by differentiating more clearly between certain stages.
11

Before going on to describe the key features of this life-cycle model, it is first
of all essential that we explain what we mean by a cluster. While a myriad range of
descriptions exist, throughout this report we shall use this working definition of
clusters:

A cluster is characterized by a wide agglomeration of industries that are
spatially linked and connected by common products, technologies and
expertise, markets (either of supply or demand) or institutional frameworks. It
is based on the availability of substantial agglomeration externalities and
encourages extensive collaboration within an inherently competitive market-
based system.


11
See John F. Wilson & Andrew Popp (eds.), Industrial Clusters and Regional Business Networks in
England, 1750-1970 (Ashgate, 2003), especially the Introduction and chapter on the Manchester
industrial district.
13
Classic examples range from the Manchester industrial district of the period 1780-
1940 (built around cotton textiles and engineering) through to the high-technology
activities of Silicon Valley in California and Northern Italian regions that have been
so successful since the 1960s. The core strengths of these clusters are multifaceted,
including the availability of appropriate factors of production (land, capital and
labour), technology and expertise, infrastructure, access to markets, and networking
opportunities that allow the transmission of tacit knowledge. This reveals not only an
ability to attract dynamic new entrants by offering vital agglomeration externalities,
but also a positive feedback mechanism between growth and entry. In particular, it is
vital to stress that the most effective clusters would appear to achieve an elusive
balance between the dynamics of competition and the benefits of collaboration. In
this context, it is also vital to note that clusters will often contain key change-agents
who will play a pivotal role in co-ordinating economic activity. While these change-
agents might only own one component in the value chain, clusters will rely heavily on
the information they provide, not to mention their influence over general levels of
economic activity.
Another issue worth stressing at this stage is that while specialised clusters
might grow more rapidly in the formative stages, it is apparent from the extensive
empirical analysis of these phenomena that diversified clusters survive longer,
principally because of their ability to attract new and related industries. It is
consequently clear that a study of firm population ecology is crucial, especially for
policy-makers, if judgements are going to be made about where scarce resources can
best be channelled. This provides a useful link with the insights earlier provided from
Shorthoses work (2002).
Having outlined the principal dimensions of clustering activity, it is also
important to assess the reasons why industries or sectors indulge in this form of
organisation. Overlaid on this analysis is the even more fundamental question of
whether it is entirely relevant to the creative industries, an issue to which we shall
return later. In the first place, while firms frequently cluster together as a means of
dealing with competitive forces, above all the key dynamic is the existence of
complementarities (skills, expertise, knowledge or resources) that can be shared
across firms. This is more conventionally known as securing external economies of
scale, by which firms are linked inextricably with others in the supply chain. Hedlund
(1987) has coined the term heterarchy to describe how firms will collaborate on the
distribution of these complementarities, principally as a means of improving firm
performance. In the process, however, and especially where there is extensive and
effective heterarchical collaboration, the cluster develops a competitiveness that sets it
apart from other groupings, leading to rapid growth in terms of employment,
productivity and turnover.
In order to analyse these issues further, it is necessary to employ the
techniques developed by Popp, Toms and Wilson (2003). The essence of this work is
based on the dynamic interaction of the resource availability and resource dependency
characteristics of clusters, given that as we have just seen from our definition of this
organisational phenomenon, firms interact extensively with each other in order to
secure any available external economies of scale. Another dimension is governance,
in that only by introducing appropriate guidelines and notions of accountability can a
creative balance between co-operation and competition be achieved. This governance
does not need to take a contractual form; as long as the group recognises the
acceptable norms of behaviour, a balance can be effected. In this context, trust plays a
pivotal role in cementing the cluster and network together, while what we referred to
14
earlier as the key change agents cementing the links across the cluster and driving the
actions of other actors towards common aims. Governance structures consequently
exist (and overlap) at the level of the firm and the cluster, whilst resource bases and
dependency at the level of the firm must be situated in relation to resource distribution
and dependency at the level of the cluster.

Resource dependency
High Low
Internal Hierarchical,
centralised [1]
Hierarchical,
decentralised [2]
Resource base
External Heterarchical,
centralised [3]
Heterarchical,
decentralised [4]
Figure 1 Resources, governance and industry characteristics
The essence of this approach is condensed in Figure 1, the dependent variables
of which are the cluster characteristics. These include components such as
institutional arrangements, market micro-structure, characteristics of entrepreneurs,
labour relations, competitive advantage, internal accounting arrangements, and so on.
In quadrant 1, where each firm in the cluster commands an individually narrow
resource base, but dependency on external resources is high, the cluster members
must identify an appropriate conduit by which the resources are to be secured. The
likely effect is to empower the section of the cluster, perhaps a particular firm, to
which is delegated responsibility for securing these resources. This may create moral
hazard and adverse selection problems within the network, where a single firm acts as
agent for the remaining firms, in addition to the principal-agent relationship between
the delegated firm and the resource provider. Accounting and accountability
structures must therefore be created which operate in two important directions. These
problems might be resolved by internalising the relationships, for example, where one
firm takes over the other members of the cluster. In this situation, central management
attempts to solve the moral hazard problem by resort to internal planning and
management accounting controls that might be characterised by multidivisional
structures. In this model, the principal responsibility of the corporate centre is raising
resources and possibly personnel functions, and distributing them as rationally as
possible to the product divisions.
The principal advantages associated with applying this model to our creative
clusters are the opportunities it provides to clarify both the level of resource
dependence and the existing corporate governance system. This is especially useful in
the creative industries, where as we noted in the last section the ecology is so transient
and unconventional. Above all, alongside the life-cycle model, this technique will
provide policy-makers with a dynamic insight into the clusters needs, whether in the
form of resources or governance structures. It is vital to emphasise that there is no
determinism in this model; quadrants [1] to [4] exist as choices for firms over time,
dependent upon circumstances. In placing the Music or Digital Media clusters in these
quadrants (see Chapter 9), we can consequently help to identify the degree to which
15
external resources can be secured or whether the governance structures need to be
adapted.
Having established these issues, it is now possible to go on and outline the
main features of the life-cycle model. The basic stages in this model are:

Critical Mass the initial clustering of expertise and factors of production.

Take-Off - often associated with key inventions or innovations, which
alongside the clustering of expertise and factors of production give the district
a significant competitive advantage

Co-operative Competitiveness - balancing the hierarchical and heterarchical
advantages of clustering and networking and achieving competitive advantage
over rival clusters

Saturation the costs of clustering start to outweigh benefits, with rate of
growth falling away, innovation rare and competition increasing from lower-
cost producers.

Maturity rival clusters offer superior advantages for new firms and decline
sets in across the older district.

Renaissance new industries locate in the cluster, attracted by either cheap
factors of production, demand for their products or the activities of regional
planners.

When specifically focusing on the final two stages, one should remember that in many
cases clusters have failed to make that essential transition. It will consequently be
essential in this report to assess whether either of the clusters is vulnerable to
Maturity and recommend how Renaissance can be achieved.
The next stage of our work has been to identify a range of characteristics
associated with each stage. These are listed in Appendix B. While this list is by no
means definitive, it has provided the research team with a series of factors which
through detailed empirical research can be located within the life-cycle model as
applied to our case-studies. This is why our project has longitudinal and contemporary
dimensions, because we need to understand how and why the case-study clusters have
reached a particular stage of development, as well as recommend means of boosting
activity.
While it is important to stress that not all clusters pass neatly through these
stages, the advantages associated with using the model are significant. When it is
being applied directly to specific examples, five key steps can be followed:

1. Identify Stage Characteristics through empirical observation of longitudinal
and contemporary perspectives
2. Conduct a quantitative and qualitative analysis of evidence
3. Assess counterfactual and actual developments
4. Identify both positive and negative characteristics
5. Consider the key issues of sustainability and rejuvenation
6. Advise on the allocation of resources

16
For example, in examining cluster development generally we can identify the
characteristics listed in Appendix B and check our accumulated empirical material
against those lists and assess which particular characteristics are either missing or
exist in abundance. This exercise will then feed directly into the planning process,
because through counterfactual and empirical analysis it will be possible to suggest
how scarce resources can best be spent or allocated. This provides the exercise with
predictive qualities that have a general utility. In addition, we shall be able to develop
accurate longitudinal and contemporary assessments of how specific creative clusters
have evolved in Nottingham.

4.3 Clusters and the Creative Industries.

While this issue will be assessed in much greater detail at a later stage in the report
(see Chapter 9), it is vital to discuss the relevance of clustering to the creative
industries. After all, as we noted in section 3.?, by their very nature creative industries
are ephemeral, intellectual and self-fulfilling, while the highly amorphous nature of
employment patterns reveals a fundamental flaw in the way official planning
initiatives have been conducted. Furthermore, there is often no classic supply and
demand interaction in the creative industries, in that self-creation frequently features
prominently. It is consequently difficult to study the creative industries in exactly the
same way that one might assess the textile or aerospace industries, posing a
fundamental challenge to those (for example, EMDA
12
) who have attempted to deal
with them all through similar policy prescriptions.
A central issue in this analysis is the glue that keeps a cluster together,
13

given the lack of a conventional marketplace for creative output and the self-fulfilling
nature of much creative activity. While it is possible to identify several characteristics
of clustering activity heterarchic collaboration, networking and the embryonic
emergence of central agencies to co-ordinate activity across groups of firms it is
equally difficult to apply all of the criteria introduced in the last section to a study of
the creative industries. In particular, as so much of the work done in music and digital
media has a local or regional orientation, it is essential that we qualify the use of
terms like Market Dominance listed under Co-operative Competitiveness. Again,
comparisons with other industries targeted by EMDA for clustering textiles and
aerospace, for example seem fatuous and misleading, given the essentially localised
nature of much economic activity in the creative industries.
Another issue that emerges in this analysis of clustering as a policy
prescription relates to the way in which this inevitably overlaps with other trends, and
in particular the age of individual firms, the trade cycle and stages in technological
development. There is an especially acute danger of ignoring the needs of firms at
different stages in their life-cycle if only the group is analysed, while temporary
vicissitudes in economic activity could mislead observers into believing that a
particular activity might be in decline. Moreover, when this is linked to technological
change (or the lack of it), it is possible to confuse the issues even further.
As a consequence, when analysing the creative industries it is vitally important
that any conclusions accommodate this diverse range of influences. Crucially, it is
essential to look more at the dynamics of the individual sector and understand how

12
See the policy documents produced by EMDA that highlight the need to pursue clustering as the
central dimension of regional economic policy.
13
We are indebted to Keith Whitesides for bringing up this issue and leading us towards a vital
question.
17
this operates at the micro- level, rather than straitjacket any analysis by imposing the
cluster model on to sectors where it is not always entirely appropriate. These are
issues to which we must return in Chapter 9, where some general conclusions will be
reached on the way in which policy-makers can support Nottinghams creative
industries, and specifically music and digital media. Above all, it will be apparent that
the creative industries cannot be treated in exactly the same way that policy-makers
are planning to address the challenges in aerospace or textiles, given the nature and
extent of their characteristics. This is not to deny that the creative industries can
benefit from the inherent advantages of clustering and networking. Indeed, in many
ways the two sectors examined have employed important features of this activity. On
the other hand, there are such fundamental differences between the creative industries
and other sectors that policy-makers must be wary of applying a universal solution to
the challenges identified in this report.

18
5. The East Midlands Creative Industries.

Before looking in detail at our two case-studies, the Nottingham music and digital
media sub-sectors, it would be useful to provide a broad overview of the general
context in which they operate. As we noted earlier, this project has not been
concerned either with mapping creative activity or conducting an economic impact
study, principally because so much research of this kind has already been completed.
Nevertheless, in order better to understand how the case-studies are faring one must
contextualise the activity as a basis for producing judgements and recommendations
that might in the future be used for comparative work.
Looking at the East Midlands in total, in 2002 the regional data indicated that
(Ward-Brown, 2003):

There were 12,375 creative industry enterprises in the East Midlands

They employed a total of 79,395 people, representing 4.5% of the East
Midlands working population

The combined turnover was almost 6.9 million

The average staffing complement is 6.4, whilst the average turnover was
452,000

The workforce is highly qualified, while at both HE and FE levels the regional
educational institutions possessed considerable expertise in the areas covered
by the creative industries

As Ward-Brown (2003) accepts, because this data fails to incorporate the freelance
and informal economy of the creative industries, which in some parts of its operation
is assumed to be very significant, it can only be regarded as vaguely accurate. This
returns us to the points made earlier, using Shorthoses (2002) research on the
Nottingham Lace Market that highlighted the highly amorphous and unconventional
nature of employment practices in many parts of the creative industries. Referring
back to the six categories offered in section 3 of this report (National Corporate,
National Public, Regional Semi-Public, Local Corporate, Local Independents, Local
Amateurs), while the first four would be incorporated in reasonable depth, it is clear
that data on both Local Independents and Local Amateurs could be woefully
inaccurate. The inclusion of the latter two would also significantly reduce the average
turnover and employment figures, given the individualistic nature of these two
categories, an issue to which we must return when assessing our case-studies.
Another important aspect to be considered is the distribution of creative
industries across the region. Using Ward-Browns (2003) recent summary, the key
centres are:

Derbyshire design, printing and packaging and architecture, as well as
software and computer services

Leicestershire design, publishing, innovative developments in the ethnic
minorities

19
Lincolnshire software and computer services, printing and packaging,
design, art and antiques

Northamptonshire software and computer services, printing and packaging,
design, advertising and publishing

Nottinghamshire broadcasting and the moving image, music (recording,
instrument manufacture and retailing), software and computer services,
printing and packaging, design, advertising, fashion and architecture

While Nottinghamshire represents the most significant concentration of creative
industries, most notably in the county city itself, it is clear from this brief overview
that activity is heavily dispersed across the East Midlands. Indeed, principally as a
result of local programmes sponsored by town councils, one might argue that
Nottingham is losing any lead it might have possessed up to the 1990s. It is also
especially apparent that software and computer services feature prominently in many
sub-regions, creating a highly competitive environment for one of the case-studies
(digital media) that dominate this report.
Having noted these spatial concentrations, however, it is also important to
emphasise how creative entrepreneurs have recently started to question the value of
urban locations as a base. This trend runs in parallel with EMDAs rural industries
initiative, because considerable effort is now being invested in boosting non-urban
locations, thereby increasing the amount of intra-regional competition. Given the
nature of creative industry work, and especially the ubiquitous availability of internet
access and improved telecommunications, this significantly reduces the need to be
located in a major agglomeration. On the other hand, as we shall see when returning
to an assessment of cluster dynamics, informal networking and direct personal
interaction play such an influential role in the day-to-day activities of the creative
industries that most recognise the value attached to geographical proximity. This issue
is of special importance to the large number of Local Independents and Local
Amateurs that frequent institutions like the Lace Market either to share tacit
information or stay attuned to developments in their sector. Moreover, for the larger
firms it is also vital to stay close to the market for their goods, especially those
associated with serving mass markets.
It remains a moot point whether the key change-agents in the creative
industries would ever consider moving their locus of activity from urban centres to
less cluttered environments. Certainly, institutions like the Lace Market retain their
vitality and centrality to the lives of creative entrepreneurs and participants. In an
industry where it is essential to capture as much information as possible on recent and
associated developments, especially given an almost universal lack of the resources
required to conduct extensive research programmes, geographical proximity is of
paramount importance, obliging firms and individuals to locate close to facilitating
institutions. This makes it all the more important for local and regional authorities
to continue to invest in these institutions as an essential means of overcoming
resource shortages across the vast majority of enterprises and individuals that
populate the creative industries.
A final issue to consider in the regional context is the extent to which the
creative industries are linked into national and international supply chains. Inevitably,
as Ward-Brown (2003) notes, the vast majority of firms and individuals are at most
regionally-focused, if not locally. On the other hand, looking specifically at categories
20
1 (National Corporate), 2 (National Public) and 3 (Regional Semi-Public), their
activities are intrinsically linked into national and international developments, not
least in the areas of public policy, market trends and the flow of information. As far as
the latter is concerned, of course, all of the categories have a vested interest in tapping
into this crucial font of knowledge, given the need to remain aware of what is
happening outside the locality. In this sense, the localised cluster will make strenuous
attempts to tap into national and international flows of information, further reinforcing
the role played by facilitating institutions like the Lace Market. At the same time, of
course, the bulk of the economic activity will occur within the locality or region,
providing a geographical focus to the creative community that requires special
attention from all those associated with policy-making.
21
6. The Micro Case-Studies.

The previous section has merely scratched the surface in evaluating how the East
Midlands creative industries operate. In order to gain a more detailed understanding, it
is essential to undertake in-depth research into each of the sectors identified by the
DCMS. Inevitably, time and resource constraints make this an impossible task to
perform within a single year, while the limited funds available meant that one of the
research assistants was only available for a six-month period. This is why we have
only looked at two sectors, Music and Digital Media, although it is possible to claim
that our work will contribute significantly to the elaboration of useful insights into
issues that directly affect all of the creative industries. Indeed, when in a later section
we apply the empirical work to the core methodologies devised to analyse these
sectors, it will be possible to establish generic points that are applicable to a wide
range of sectors. This will also act as the basis for the next stage of our research, when
both the number of sectors covered and their geographical range will be extended
substantially.
The people interviewed as part of the research for this first stage of the project
are listed in appendices C and D. This indicates that the digital media sector was
represented by forty-one people and music by fifty-four. While this does not cover all
the respective communities, it provides sufficient credibility for our findings and the
implications we will draw from this research in chapter 9. Even though some
interviews were relatively brief, and on rare occasions hostile, in general most people
offered highly useful and instructive insights into what are fascinating sectors of the
local economy. These views were also reinforced by the focus group meetings
conducted by InnovationOnline, providing dual sources of information that can
usefully be incorporated into the analysis. While it is inevitably dangerous to rely
solely on verbal evidence, given the possibility that many of the views expressed lack
objectivity, by balancing this work with ideas and material generated elsewhere it has
been possible to derive useful generalisations from the evidence that can be fed into
the policy-making forums across the city and region.
22
7. The Nottingham Music Cluster


7.1 Background

The contribution of music-related businesses to the UK economy is undoubtedly
enormous. In spite of the recent decline in CD sales, the annual current net overseas
earnings of this sector exceed 400 million. Several reports have also been produced
over the last decade summarising this valuable economic role,
14
indicating that: The
excellence of British music and its contribution to UK cultural life is widely
acknowledged.
15
Having stressed the macro-economic benefits of the music industry,
it is vital to note that a large part of the sectors market is domestic. UK domestic
expenditure on music in 2000 amounted to 4,932 million, while on the basis of
projections linking regional population and income levels, it would seem that the
annual domestic expenditure on music in the Greater Nottingham area is likely to be
of the order of 20-22 million. At the same time, like other creative industries, the
music-related sector is not merely of financial importance to a region; it links into
important determinants of regional identity and contributes to the quality of life. It is
a highly mature industry with an indefinable pedigree stretching back centuries,
indicating how any study of this sector must accommodate long-term trends.
Moreover, it is difficult to refute the key contribution of the cultural industries as a
whole, and music in particular, to regional life in the current context. Indeed, music is
arguably an outstanding example of a creative activity with both economic and life-
enhancing qualities. In one form or another, music is of interest to so many people that
it can potentially cross national and linguistic boundaries, as well as political and
religious divisions. Furthermore, an appreciation of, or active participation in music,
whether popular, ethnically distinctive or at the so-called pinnacle of high art, is likely
to be lifelong and has the potential to provide avenues for the exploration of all cultures
of the world.

7.2 Introduction to the Nottingham Study

As we have already noted, apart from any qualitative impact that must remain
unquantifiable, the music industry in Nottingham forms a significant part of the
economy, with an annual expenditure of at least 20 million. There are certainly a
number of successful businesses based in and around the city, while a plethora of
activities covering an enormous musical spectrum occur locally. Music is important to
the city. This reveals a first essential point, that the Nottingham music sector is a
highly mature cluster with an extremely long pedigree and impressively diverse
range of activities and interests. What follows is an attempt to identify the major
characteristics of this cluster, how the various components fit together, and what can
be done to improve both opportunities and performance levels. While the Nottingham
music sector possesses tremendous strengths as a result of its longevity and diversity,

14
See, for example, Overseas Earnings of the Music Industry: British Invisibles (1995); The Value of
Music (1996); A Sound Performance: the economic value of music to the United Kingdom (1999);
Counting the Notes, a National Music Council report on the economic contribution of the U.K. music
business, 2001.
15
Overseas Earnings of the Music Industry: British Invisibles (1995)
23
there remain significant constraints on further expansion that a detailed study can
highlight.
In the first place, it is vital to note that Nottingham possesses a significant
number of categories of commercial musical activity, including:

1. Performance.
2. Promotion.
3. Manufacture of instruments, accessories and music technology-related products.
4. Recording and CD production.
5. Training and teaching.
6. Maintenance, repair and reconditioning of instruments.
7. Retail of musical instruments, sheet music, music-related books and equipment.

Linked to this categorisation are two assertions:

1: Many of these commercial operations are largely dependent on musical
activities which are essentially amateur,
16
and that the economic inter-
relationship between the two sectors is highly complex. Of course,
participation in amateur music-making is dependent on training and supplies,
both of which are usually delivered by professionals. However, the issues are
more complex than this, leading us into a much more sophisticated analysis of
an interactive process that provides real insights into clustering and
networking.

2: Many of the commercial activities are closely inter-related, and in some
cases the level of inter-dependency and inter-action with other businesses
(both creative and non-creative) seems to be much greater than in other sectors
of the creative industries. Many of these apparently specialised commercial
activities make use of an array of other Nottingham-based businesses and
services, including printing, distribution, photography, catering, advertising
and especially the excellent library facilities. The latter was widely cited by
professionals and amateurs alike as an important support and research tool.
17


It is consequently apparent that any study of the music cluster must be aware of the
high level of interdependence that exists across the different categories listed earlier.
Moreover, as we shall see in section 7.?, a vital role is played by locally-owned music
retailing outlets, a role that stretches across many types of music. While this is an
issue to which we must return later, it is already apparent that the cluster possesses
some key agents who can determine a considerable amount of the interconnectivity
necessary for effective performance and communication.
Another important introductory point relates to the claim that music businesses
are much harder to describe than conventional businesses with their established areas
of activity and defined numbers of permanent or contracted employees. This provides
a link with our earlier review of Shorthoses (2002) analytical work on the Lace
Market. One might even go on to say that perhaps more than any other industry,
music businesses change their focus repeatedly, either in order to exploit market gaps
or to respond to specific commissions, changing tastes and market trends. This has

16
We here define as an amateur any person who does not derive more than half of their income from
musical activities.
17
See section 7 below.
24
become particularly important in recent years, following changes in the way arts
funding has been allocated.
18
For many businesses, this has evolved further, in that
while some businesses appear to offer an array of services, only a few of them are
actually provided by their permanent workforce. Crucially, there is widespread co-
operation with a much larger number of what we shall at this stage refer to as
associates who are recruited and employed as and when required.
19

Two illustrative examples of this practice may be usefully cited as models
typifying music industry practice.

1. Players in London-based orchestras, such as the London Philharmonic, BBC
symphony orchestra, or top provincial orchestras such as the City of Birmingham or
the Hall, are normally contracted and salaried. However, it is common for
performing groups and less well-established orchestras to engage players from a
known core of established professionals, contracting them for specific projects,
engagements or even single concerts, as and when required. Even when players have
been contracted to perform at a specific event, it is common for them to send a deputy
if a better opportunity arises simultaneously. A typical situation would be one in
which only the conductor, leader and administrator are contracted employees of the
orchestra. This situation is becoming more commonplace in performing groups
throughout the UK; it is widely regarded as the only way for many musical enterprises
to survive, especially outside London.

2: Analogous situations are commonplace within musical businesses which also act as
agents for a variety of additional services. For example, businesses involved in retail
often also offer technical services - for example, instrument repairs and servicing -
using instrument technicians very loosely associated with the company who often
undertake similar freelance work elsewhere. Similarly, many promotional services, as
well as tuition, recording and CD duplication services, operate in this manner as add-
ons to the main business. Thus, many retail premises act as interfaces between
customers and a variety of associated businesses.

This introduction has demonstrated that a study of music and music-related business
in Nottingham requires a highly detailed knowledge of the working practices of those
involved. This will lead us to some concrete recommendations that can be applied
across the music sector. Employing a generic questionnaire (see Appendix A) to
initiate discussions with these practitioners, an extensive round of interviews (see
Appendix C) was conducted as a means of achieving the required depth of coverage.
On the whole, the response was frank, helpful and positive, even if some subjects
were surprisingly secretive about their business activities and had to be coaxed into
agreeing to give an interview. Indeed, a few were aggressively resistant to discussion,
apparently believing that competitors could acquire crucial information by this means.
A delicate process of winning trust was consequently required, an approach based on
Dr. Brackens intimate links with the music profession. The research was also
facilitated not only by the promise of a publicly-available report, but also the
formation of focus groups that would encourage practitioners to speak publicly and
collectively about the need for more collaboration across the sector as an essential
prelude to improved performance.

18
On this point, see section 7.3 below.
19
Indeed, according to some estimates, 45% of teaching in UK universities is supplied on this ad hoc
basis.
25
A final caveat to add at this stage is that it will become apparent that there is a
bias in this report towards the classical music sector, leading to some neglect of the
more popular forms. This bias has been imposed by the inevitable time constraint, in
that funds were only available to support Dr. Bracken for six months, leading us to the
decision that it was better to generate a detailed report on one aspect of music in
Nottingham, rather than trying to skim the surface across all genres. At the same time,
it is clear that many of the issues raised are generic to the whole sector, and in
particular what we shall say about the structure of the Nottingham music industry. We
would consequently argue that while more detailed research is required into the
popular music areas, policy-makers should be made aware of what this report has to
say about current and future trends across the sector as a whole.

7.3 Musical Performance, Promotion and Venues in Nottingham

There is a huge variety of music performed in the City of Nottingham. A major focus
for this activity, of course, is the Royal Centre. This facility is the result of the
restoration and redevelopment of the nineteenth-century Theatre Royal and the
adjacent site of the nineteenth-century Empire Palace of Varieties. The work created
an impressive complex that includes a theatre, concert hall, catering facilities, meeting
rooms and bars. It is effectively the cultural centre of the City, as well as an important
business in its own right generating a turnover in excess of 7 million. The two major
elements of the Royal Centre are the Theatre Royal (with seating for almost 1,200)
and the Royal Concert Hall (2,500).
Nottingham, unlike Birmingham, Manchester or Liverpool, lacks an
established resident professional orchestra. As a result, the need for a symphony
concert series in a city of this size and importance resulted in a number of local
promotions of classical and other music in the Nottingham area. These often clashed,
and the situation was rationalised with the establishment of the City and County in
Concert programme twenty years ago as a compromise measure. This programme is
an equal-partnership collaboration, in which the arts departments of Nottingham City
Council and Nottinghamshire County Council co-operate in the promotion of classical
and contemporary music, early music and jazz, with both offering a subsidy to the
scheme. A contribution is also received from the Arts Council, via the Eastern
Orchestral Board. The annual turnover of the entire scheme is around 300,000, with
the City and County Councils subsidising the programme to the tune of approximately
57,000 each. This results in an important annual concert series rivalling the very
successful concert series at the De Montfort Hall in Leicester,
20
featuring the resident
Philharmonia Orchestra.
While the current situation provides a reasonable range of concerts, it has only
developed after a problematical period, especially during the 1980s, during which
there were major changes in the criteria relating to arts funding provision. These
changes precipitated considerable debate, some of it apparently quite heated, about
how to ensure a level of orchestral music provision appropriate to the city and
surrounding region. Key events in this process included the incumbent Conservative
governments attack on the welfare state mentality in the arts, by insisting that all
major arts funding was to be on a rolling three-year basis. Arising out of this debate
was the publication of a major Arts Council policy document known as the Glory of

20
Seating capacity at De Montfort is 2,802.
26
the Garden,
21
which outlined the new direction of Arts Funding. Both steps were to
have many implications for the music industry, and especially concert promoters, in
the Nottingham area.
The Glory of the Garden described a new vision of orchestral music provision
outside London, especially in the eastern area bounded by the Thames in the south
and the Cleveland Hills in the north. Essentially, this vision involved greatly
improved and better co-ordinated use of existing orchestral resources, both from
London and elsewhere. It also proposed the establishment of a new orchestra in the
East of England.
22
The phrase better-co-ordinated use envisaged the establishment
of a nominated, rather than elected, authority with a fixed budget to arrange regional
tours by orchestras, including London-based orchestras.
The Glory of the Garden specified what this could mean for Nottingham in
particular:

The Arts Council therefore intends to enter into discussions with a view to
discovering whether one of the London orchestras might be willing to transfer
its base operations to a city, most probably Nottingham, from which it could
serve the eastern part of the country. Alternatively, the Council could seek to
establish a new orchestra in the region.
23


The local response to this, in the form of an undated document written jointly by
eastern Arts, East Midlands Arts and Lincolnshire and Humberside Arts, set out
some of the practicalities with admirable clarity.
24
At the same time, the Glory of the
Garden was surely correct in highlighting a key problem that remains as relevant
today as it was then: since the establishment of the Arts Council in 1945, there has
been a steady increase in the number of revenue clients, and funding is being sought
by an ever-widening spectrum of applicants for increasingly diverse activities. As a
result, there was and still is a danger of spreading the available resources too thinly at
the expense of primary activities.
25
Accordingly, the Arts Council proposed three
changes:

1: To cut costs by about 10% in all areas.
2: To use the surplus created to fund new developments.
3: To devolve the responsibility for client funding to regional arts associations.

While some specific remarks about music in the Nottingham region were included in
the document, no suitable accommodation with a London-based orchestra was
reached. Indeed, a great deal of acrimony seems to have been initiated by the Glory of
the Garden, as the funding map was redrawn and a number of organisations ceased to
be Arts Council revenue clients. Following these teething problems and a period of
quiet reflection, the City and County in Concert series emerged as the compromise

21
The Glory of the Garden: the development of the Arts in England, a strategy for a decade, London,
1984. The title, incidentally, makes use of a traditional metaphor the garden as a symbol of mans
life, used by Pope, Kipling and others.
22
Quoted from the Arts Council discussion paper Promoting Regional Orchestral Music, 18 April,
1985, in the version circulated prior to the discussion held by East Midlands Arts at Mountfields
House, Loughborough on 2 June, 1985, a document used extensively below and cited hereafter as
PROM, 1985.
23
The Glory, 18, section 5.6.
24
Cf. Appendix 1 below.
25
Cf. The Glory, 1-2, sections 3-7.
27
solution. The programme is now built around a major orchestra, essentially an
orchestra in residence,
26
which gives the bulk of the concerts, as well as concerts
from the East Midlands-based Viva orchestra. In addition, there are visits from
touring orchestras. The latter are usually either overseas touring orchestras, often
bought in at relatively low cost as they receive a subsidy from their region of origin,
or salaried orchestras, such as the BBC Orchestra of Wales.
For most promoters, the ideal orchestral residency links performances with
education. In recent years, it is expected that an orchestra in residence and its
associated splinters will involve themselves in constructive dialogue with the
promoters about programming, as well as offering, as an integral part of their
arrangements with the concert promoters, some form of educational outreach to the
community in the form of visits to schools, involvement with community projects and
pre-concert talks. The present arrangement with the Manchester-based Hall
Orchestra, currently resident in Nottingham for the City and County in Concert
series, and due to continue this under the present contract for another two seasons
after the 2003-4 season, seems to be excellent in this respect. The promoters are
satisfied that the Hall are enthusiastic in this respect, and that their conductor Mark
Elder is willing to participate in highly constructive dialogue relating to outreach and
programming with the promoters. Unfortunately, though, this apparently happy
situation is not without its problems: audience numbers are in decline, despite the high
standard of music provision, the numbers of subscribers to the entire series is also
falling, and the so-called greying audience has become an obvious feature over the
last decade.
The Royal Concert Hall also offers a series of concerts - often one-night
stands - by touring professional artists from all areas of music, as well as local groups,
both amateur and professional. This seasons offerings include performances by
artists as diverse as Bjorn Again, Craig David, Michael Ball, Paul Carrack and the
Glen Miller Orchestra. Important local groups such as the Nottingham Philharmonic
Orchestra, Nottingham Festival Opera, Nottingham Harmonic Choir, the East of
England Singers, Nottingham Youth Orchestra, Nottingham Hospital Choir and many
others contribute to this wide-ranging programme.
The Royal Concert Hall is consequently used effectively, offering a full and
wide-ranging programme of music and music-related events. The event programme
for the period September to January 2003-4 can be broken down to give an overall
performance profile at the Royal Centre by genre, by expressing the total
performances of any particular entertainment type as a percentage of the total
performance number. Obviously, such an analysis is highly subjective: the potential
problems of defining categories such as popular music or musicals are self-
evident; it is also possible that certain events could fall under more than one category.
However, it offers a useful initial summary of current trends:

31% shows and musicals 5% opera
27% drama and poetry 5% orchestral
23% miscellaneous 3% ballet
16% popular music


26
This follows a period during which a variety of orchestras from outside the region were involved in
the concert series, often involving a high level of subsidy.
28
Clearly, orchestral music and opera are a low proportion of the whole schedule, the
figures reflecting the reported increase in demand for West-End-type shows in recent
years which the management of the Royal Centre associate with the success of Lloyd-
Webber musicals such as Phantom of the Opera.
A second important series of concerts takes place at the Lakeside Centre, a
thriving arts facility on the edge of the main University of Nottingham Campus under
the enlightened direction of Shona Powell. This is the main arts centre per se, and is
essentially the Universitys cultural outreach to the people of Nottingham. The
Lakeside offers numerous concerts of chamber music, world music and jazz, as well
as exhibitions of painting, sculpture and photography. The latter are usually free to the
general public. The varied nature of the spaces available at the Lakeside, including the
Djanogly Recital Hall and the Lakeside Theatre, with seating capacities of 250 and
200, respectively, mean that the music offered is far less mainstream. An emphasis
on chamber music, world music, jazz and early music is clear from the advertising
materials.
27
Other important concerts of choral and baroque music, involving groups
such as the Orchestra of the Restoration, the Nottingham Bach Choir, often take place
in St. Marys Church, High Pavement. In addition, there is considerable activity in a
number of other forms of music, including the largely amateur groups which make a
considerable contribution to community-based education by the same means,
examples of which include the contemporary music group COMA.
Given this impressive range of concerts, a recurring theme in the many
interviews conducted for this report was the lack of suitable affordable venues for
small-orchestral and chamber music, jazz, blues, world and traditional music in the
City of Nottingham. Indeed, this is widely recognised among music professionals in
the area who perceive the need for a hall of between 400 or 500 seats with acoustics
appropriate to small-scale musical events. The study has also identified the
enthusiasm of some Nottingham retail businesses to promote such a venue in the
future by selling tickets on its behalf. Such a hall was even recommended and
described in the original plans for the redevelopment of the Royal Centre.
As we are all too well aware, however, the latter was never built, creating a
significant gap in central Nottingham. As a consequence, two venues with possible
potential for further development have been pressed into service. The Congregational
Hall on Castle Gate is used by the Nottingham Music Society, promoting a high-
profile series of chamber music recitals.
28
Unfortunately, though, this is essentially an
ageing building designed for non-conformist worship, rather than as a concert hall.
Indeed, the Congregational Hall must surely be regarded as well below the requisite
standard for a small concert hall in a thriving European provincial city. Furthermore,
there is widespread recognition that it cannot be used as a jazz venue, as it is both
acoustically unsuitable and offers limited possibilities for the kind of refreshment
that would be essential in attracting a younger audience.
Another building of great interest in this context is the Co-op Arts Theatre on
Heathcote St, a venue which is sustained by the determination and dedication of the
largely volunteer staff. This theatre, which has traditionally offered an interesting and
ambitious programme of amateur dramatics and operetta, has recently been acquired
by a syndicate that hopes to sustain the theatre. Modernised booking facilities and a
caf have been added, while an ambitious series of small concerts and recitals is
planned. While the building is undeniably in a poor state, and a great deal of money

27
This priority is also reflected in the Lakesides hosting of the 2003 Modal Conference.
28
This series is, at the time of writing, in its eighty-first season (2003-4) which includes concerts by
artists as important as Marc Andr Hamelin, the Medici Quartet and the Florestan Trio.
29
will certainly be needed to bring the theatre up to a modern standard, there can be
little doubt that it possesses an excellent location, as well as a charm of its own which
largely offsets the poor back-stage facilities.
In the absence of a suitable jazz venue in the City of Nottingham, until
recently most music of this genre has been organised at the Bonnington Theatre in
Arnold, where high-profile professional artists have played. Recently, the Lakeside
Centre has not only offered more good-quality jazz than it did previously, but has also
attracted good audiences. A key factor in the success of these promotions has been (a
classic example of business clustering activity) the initiation of a consultation process
with competitors. As a result, the Lakeside series has managed to avoid splitting the
established audiences for jazz at the Bonnington Theatre and at the three jazz venues
in Derby (the Assembly Rooms, the Dance Centre and the Wardwick) which also
promote an important series of jazz concerts. Ticket-sales data demonstrate that this
simple initiative of pre-season discussion between the management of these venues
has been extremely successful, providing the rationale for a strategy which other
promoters ought to consider.
As a consequence of the demand for a small-scale concert hall, the Djanologly
Concert Hall at the Lakeside Centre is under enormous pressure as a venue for
chamber music, piano recitals, jazz and other small-group events. Originally designed
for small-orchestral and chamber music and operated in conjunction with the music
department of the University of Nottingham, many organisations have experienced
difficulty in booking it during term-time, an issue that seems to be connected with
increased commercial use of the University Great Hall. This trend has also had the
effect of displacing increasing numbers of events into the Djanogly Hall, thus
adding to the pressure on this venue. There are several problems associated with this.
In the first place, the booking system is under such pressure that this Hall is not
always available to groups from outside the university because it is also used by the
music department for internal rehearsals of orchestras and choirs, concerts, recitals
and examinations. Secondly, although the Djanogly Hall is widely regarded as ideal
for chamber music, it is by no means large enough for orchestral concerts, either in
terms of players or audience.
In view of this, a future development at the Lakeside - and one which would
please the university music department staff - could be the construction of a new
concert hall, as part of the Lakeside Complex. According to Dr. Sackmann, the
current head of the music department, a model for this could be the Sir Jack Lyons
Concert Hall in York. As this venue is much smaller and more intimate in feel than
the Royal Concert Hall, it could be used for orchestral concerts running with much
lower overheads than a city-centre venue. This would have three advantages: firstly,
orchestras such as the City of Birmingham Symphony orchestra or the London
Philharmonia
29
could take up residencies, enriching the musical life of the city;
secondly, such a venue would be more affordable to outside groups who need an
orchestral venue that is less expensive to hire than the Royal Concert Hall; and
thirdly, the pressure would be taken off the Djanogly Concert hall, which could then
shed some of the orchestral rehearsals, for which it is manifestly unsuitable, and offer
more booking opportunities for other activities.
While it seems likely that any such premises at the Lakeside could be subject
to similar problems to those currently surrounding the Djanogly Hall, and that a new

29
The London Philharmonia
29
at present seems unwilling to venture further north than Leicester, where
it has a residency at the De Montfort Hall.
30
hall in this location could become an overspill venue for the University in general,
and the music department in particular, contemporaries are almost unanimous in
demanding the provision of another small concert hall. Of course, the transport links
to the Lakeside remain problematic, especially during the evening period, further
encouraging the use of cars and discouraging the non-mobile from attending.
Consequently, in order to maximise access for all, a good case for establishing such a
venue in the city centre can be made. On the other hand, as we shall see later, this
argument is undermined by the widely-recognised problems in the city centre.
A number of participants in the study raised the issue of the lack of affordable
venues for amateur and semi-professional orchestras and choral societies. The
extremely high cost of hiring the Royal Concert Hall and the Albert Hall
30
means that
the overheads associated with putting on concerts at either venue creates commercial
hazards, unless a subsidy is available. The prevalent view within the amateur sector is
that despite the large subsidies paid out through the City and County in Concert
scheme to facilitate residencies by the London Philharmonic Orchestra and now the
Hall Orchestra, important Nottingham-based amateur groups who cannot afford to
hire the Royal Concert Hall continue to experience a venue problem. Examples
include the Nottingham Symphonic Winds and the Nottingham Youth Orchestra, both
of which are unable to give concerts in the highly unsuitable acoustic conditions of
churches that provide a possible alternative venue. There can be little doubt that
groups such as this are an important aspect of the musical life of the city; even though
some accept that their repertoire is not always at the cutting edge of new work, they
are fulfilling an educative function by offering an opportunity to play and learn at a
level which school orchestras no longer reach. At the same time, the cost of publicity
is prohibitively high in relation to their other costs, while there is little or no co-
ordination either between these groups or between them and the professional sector.
This leads to the possibility that some form of shared mailing system could be
established (ideally with some form of in-built checking system to minimise
performance clashes), an issue to which we shall return later.
A venue problem was also identified by many of the interviewees in
connection with popular and rock music in the city. Venues such as Rock City, The
Social and Bunkers Hill are all active in this field, although the Old Vic, a large public
house with a 450-seat capacity which was once a popular music venue, now places an
emphasis on cabaret in its most exotic sense. The Ice Stadium is also an important
venue for well-established touring commercial stadium bands. However, many local
performers in this particular genre of music are currently bemoaning the lack of clubs
and pubs in and around the city centre that are willing to encourage live
performances, especially when they include artists from Nottingham. The newsletter
Gigged, a free monthly guide to unsigned music which also prioritises the reviewing
of local bands, seems to be fighting a losing battle in this respect. On the other hand,
the efforts of this magazine have been bolstered by the Arboretum summer season, a
programme of concerts at an open-air bandstand at which 90% of the performers are
local musicians. Furthermore, the record and book store Fopp, a branch of which has
recently been established in Nottingham, devotes a large amount of shelf-space to
unsigned and local bands. This is an issue to which we shall return in the next section.
Paul Morgan of Nottingham City Council Arts and Events suggested that the
shortage of venues with suitable capacities of up to 600 may be one of the factors

30
The latter is a cheaper option, although many considered it to be poorly located in relation to car
parking and transport.
31
contributing to this apparent anti-local prejudice. Others may be the lack of either a
flagship Nottingham band with a major hit record, as well as the lack of a
recognisable musical genre which can be linked to the Nottingham music scene.
31

Nevertheless, there seems to be a rising tide of urban music in Nottingham which
may be capable of correcting this apparent imbalance. Once again, though, it is
apparent that without the right kind of venues or appropriate communication and
marketing system, severe constraints might limit this surge in activity.

7.4 Concert Promotion

The listing and advertising of venues and events - essential to maintain audiences and
to win new ones - seems to be a perennial problem in Nottingham, as in many British
cities. In Nottingham, listings are largely unconnected, with a traditional reliance on
the mailing and ad hoc distribution of free leaflets, listing the events of a single
musical venue or organisation. These are often glossy and costly to produce, while
both their production and mailing represent major expenditures for smaller and
amateur organisations. Indeed, some of the amateur organisations regarded this as a
major expenditure, leading several of the organisations interviewed to propose the
idea that some sort of shared mailing system - mail-shots which contain the publicity
of several organisations or venues - could be used. At the same time, while this would
certainly reduce costs, it would also involve the sharing of mailing lists if it was not
done through a third party, raising a data protection issue that might precipitate other
problems.
The shared publicity possibility for increasing the effectiveness of
advertising that was widely discussed during the survey, especially as it would avoid
the problem of mailing list sharing, would be the production of a single publicity
leaflet for the city - perhaps a weekly or monthly listings magazine covering a wide
variety of activities, including music of all genres, theatre, dance and cinema, with
sections for restaurants. If it was a really full listing, this magazine could be sold to
recoup some costs, with additional advertising to be included as a further income-
generation exercise. The crucial factor would be to produce this cheaply, perhaps in
newspaper style. The model could be the comprehensive information provided about
arts events and cultural activities presented in the Pariscope, a cheaply-produced
listings magazine also accessible through the internet. The printed version - widely
purchased by Parisians and visitors alike - costs one Euro, providing a comprehensive
listing of concerts, exhibitions, theatres and cinemas in the city. It is perhaps also of
interest that both Parisians and visitors from provincial France purchase more specific
and comprehensive guides to particular types of entertainment, such as jazz clubs.
Currently, some event and venue listings are being incorporated into a new
database created by the co-owners of Clement Pianos, known as Centre Stage, an
innovation we shall assess further in section 7.?. The only alternative is the East
Midlands City Lights, which provides daily events listings under the categories of Art,
Clubs, Comedy, Film, Music and Theatre. However, apart from being a costly
production, with numerous photographs and advertisements, there can be little doubt
that the listings are anecdotal rather than comprehensive. Indeed, the listings section
devoted to Clubs is by far the largest part, typically taking up around 60% of the
column inches, a statistic which when combined with the numerous photographs of
restaurants and bars, suggests that many readers will consider that the magazine

31
Birmingham, Liverpool, Manchester and Hull, for example, have all evolved a specific sound.
32
merely promotes Nottingham as a clubbing, drinking and dining centre. City Lights
does this very well, but it surely cannot be seen as a listings magazine of relevance to
a wide spectrum of music, exhibitions and arts. Further thought consequently needs to
be applied to how accurate and comprehensive information can be transmitted to a
potential audience on an extensive range of musical activities.

7.5 Starting Times and Audiences

A number of performers from the classical sector are disappointed by the continuing
inflexibility of concert start-times, leading to the suggestion that some more
innovative approaches ought to be adopted. The 19.30 start-time would appear to be
so firmly entrenched in Nottingham that it seems to be almost written in stone - with
the occasional concession of a 19.00 start if children are going to be present or
religion is somehow involved.
32
A number of music professionals regard this as a
formulaic approach to concert-giving, arguing that it is one of the major causes of the
rising age profile of the typical concert audience, the so-called greying audience. As
one interviewee with a lifetimes experience in the industry noted, this rigidity is an
attempt to sustain a concert culture which is at least twenty years out of date. Indeed,
there can be little doubt that this approach to programming is being maintained in the
face of changes in lifestyle which mitigate against it: many of the 30-55 year-olds
who might be expected to attend such concerts often have considerable difficulty in
returning from work and arriving at a concert by this time. On the continent, for
example, concert start-times vary considerably; morning and afternoon concerts are
commonplace, especially at weekends, and evening concerts often begin at 20.00 or
even later.
Of course, emulating this sort of start-time flexibility in Nottingham is by no
means a simple matter. It is complicated by a host of factors, including the availability
of public transport. Another point raised most consistently by interviewees was the
increasingly threatening nature of the city, compounding the problems encountered
when using public transport. Numerous interviewees observed that aggressive
begging and the youth culture of walking from pub to pub while binge drinking en
masse - inescapable aspects of modern British life, but especially prevalent in
Nottingham - was insufficiently managed in this city. Indeed, groups of bars which
cater for the youth market have been allowed to develop in all parts of the City, rather
than being confined to particular areas through judicious planning. Crucially, the bars
in the pedestrian street leading from Milton Street to the Royal Concert Hall are
increasingly prone to this behaviour, rather than exhibiting the European-style caf
culture which so many Nottingham residents would welcome and enjoy. These
problems are surely a barrier to both the development of the arts and to the
widespread use of public transport. Indeed, one of the interviewees, a professional
orchestral player with many years experience and a considerable track record of
service on regional arts committees, observed that the current level of disorder in
Nottingham during the evening means that both players and audiences alike will
continue to use their cars in order to feel safe. He also added that many will simply
not attend an event if they cannot park nearby, as they feel unsafe on buses and at bus
stops.

32
For example, the programmes for the Nottingham Classics series 2003-04, and the Nottingham
Choral Trust Twentieth Anniversary Festival 2003.
33
These closely-related problems are surely a major obstacle to experimentation
with concert start-times, and consequently to the development of music-related
activities in the city. Indeed, they were so widely identified as such by interviewees
that increased communication between city planners, those involved in the promotion
of Nottingham as a tourist venue and the promotion of music at the highest levels
seems to be an urgent necessity.
33


7.6 The Value of the Amateur Sector to the Professional Cluster

As we noted earlier, one of the most important findings of this study relates to the
relationship between music professionals and the substantial amateur element in
the sector. Crucially, the vast majority of the former - that is to say, participants in the
sector who derive their income entirely from the manufacture, servicing or retail of
instruments and printed music, or from teaching or performing - perceive the latter to
be a vitally important aspect of the economy of the sector as a whole. It is
consequently vital to assess the nature and extent of this interaction, in order to build
an accurate picture of the Nottingham music sector and the extent to which one can
identify clustering and networking activities.
On an obvious level, the professional-amateur link is manifested in the form of
teaching. This has been an expanding area, with many music teachers reporting an
increased demand for music lessons from retired and semi-retired people who find
that learning to play an instrument is a life-enhancing experience. Similarly, amateur
groups, such as operatic or choral societies, purchase scores, hire a venue and employ
a professional or semi-professional director and/or rehearsal pianist for the season, as
well as paid orchestral players for the performances. Indeed, several respondents
pointed out that amateur music groups spend their money almost entirely within the
region, while out-of-town professionals bring in their own equipment. Even
resident professional orchestras, for example, do little to stimulate the local
economy, because they are not physically resident and there is little real input to the
Nottingham economic sectors in the form of purchases of scores or equipment, spare
parts or servicing.
34

With specific reference to these amateur groups, another important point
relates to the funding available for their work. Of course, many now recognise that it
is neither desirable nor in keeping with the Glory of the Garden statement to offer
funding to amateur organisations that put on concerts which make a profit in order to
prop up the rest of a concert season financially. Furthermore, few would welcome a
return to the restriction of subsidy, as was previously the case, to the organisations
which are NFMS affiliated. On the other hand, the problem is far more complex than

33
Such a dialogue seems to be quite minimal at present. Dr. Bracken posed as a member of the public
seeking information about cultural activities and opportunities to hear concerts in the Nottingham area
at the Tourist Information Centre in Nottingham. He was mildly surprised to be plied with leaflets for
Warwick Castle and Hardwick Hall, and noted that the Music in Quiet Places concert series was not
mentioned, nor any of the forthcoming concerts at the Royal Concert Hall. It was of some concern that
the advisor involved did not seem to have even the slightest background knowledge; neither did she
attempt to access any source of further information.
34
This may be offset to some extent by the financial injection associated with arts-related tourism, if
the attraction in question is of high enough quality. See H. Hughes, Arts, Entertainment and Tourism,
Oxford, 2000, pp.173-5. Hughes work includes the results of surveys taken at arts events, but there is
considerable variation in the type of event and location, and any further discussion or prediction would
have to be based on specific surveys in this region.

34
this: many amateur productions - including many which were previously well
established through NFMS affiliation - acted as bread-and-butter employment for
freelance orchestral players. These, the Glory of the Garden suggested, would
hopefully reside in the Midlands. However, the dilution of subsidy over more and
more diverse genres of musical activity has reduced the number of amateur-
professional collaborations of this type, forcing a significant number of good players
who are primarily performers into teaching. As a consequence, there is a good case
for offering a subsidy to such groups, especially to encourage start-ups that are not
linked to the NFMS, even if continued subsidy - other than in the form of subsidised
access to performance venues - may be harder to justify.

7.7 Amateur and Semi-Professional vs. Professional

Having introduced some of the more positive aspects of this relationship between
professionals and amateurs, it is equally important to evaluate some underlying
tensions. While some of these are universally recognised, in Nottingham several have
become even more pronounced over the last twenty years. A number of professional
musicians who participated in the interviews advanced the view that the continuation
of subsidies beyond free or subsidised access to concert venues, especially to
orchestras that are essentially amateur groups, most of whom are in employment and
in receipt of salaries, needs to be examined closely. Some would go even further and
assert that it is neither culturally valuable nor morally desirable to sustain these
subsidies.
In extending this discussion, it is important to note at the outset that the
influence of the Musicians Union in the Nottingham area is weak. As a consequence,
the distinction between professional and non-professional performers and
performances seems to be particularly blurred in Nottingham. For many professional
performers, Nottingham is known as the home of the semi-professional, because
from their perspective far too many venues are willing - and indeed even encourage -
the use of a pool of competent or barely-adequate performers. These are sometimes
students, although more often they are people who have taken early retirement from
another career and are in receipt of a pension. Hobbyist performers such these, while
they may be competent and sometimes rise above that level, are actually driving down
the level of fees which organisers of non-contract orchestras and venue proprietors -
managers of public houses, hotels, restaurants and conference facilities - are prepared
to offer to professional musicians. Consequently, the union rate is almost never paid
in Nottingham. One interviewee with 35 years professional playing experience
complained that she could not remember the last time she had been paid the Union
rate for her work.
Given the acute nature of this issue, there has been a drain of professional
players into teaching, with concomitant migration of good players to centres such as
London, Birmingham or Manchester, where both better opportunities are available
and the Musicians Union has a stronger influence.
35
In the view of a number of
professional musicians in Nottingham, this has the effect of lowering wages as well as
general expectations of the sector, not to mention the standard performance at

35
Of course, the majority of professional players even the best London-based professionals - also
derive a portion of their income from teaching, but there is widespread recognition among performers
that the right balance must be achieved in this respect in order to maintain a high level of playing skill.
35
professional level and the quality of musical provision in the region as a whole.
36

Some professional performers are particularly resentful of specific venues that are
notorious for this form of activity, advocating a naming and shaming attack on
them. On the other hand, others would argue that the problem is related to a national
tendency to use music as a commodity associated with corporate meetings, product
promotions, sports events or civic functions, where decisions about music are often
taken by multi-tasking administrators who are understandably anxious to obtain
commodities, including music, at minimal cost. Equally, the current political
preference for market-based solutions would prevent direct intervention to enforce a
unions ability to determine wage rates, limiting the possibility of any return to a
philosophy that virtually disappeared twenty-five years ago.
Having noted these issues, it would nevertheless be desirable to form a
musicians guild, or some form of trade association - perhaps with a detailed database
- in order to provide administrators with reliable information on the availability of
professional musicians. The source of this information should also surely be the music
community itself, providing the requisite degree of control over material that could
prove highly valuable in generating more opportunities for the professional
musician.
37
This is the kind of activity that Andrew and Michael Wilson at Clement
Pianos have initiated, setting up Centre Stage as a database of professional musicians
in Nottingham. This database will also be accessible through the internet, once a
suitable web site has been designed and enacted. An additional purpose of this
information would be to provide guidance to amateur performers seeking tuition, or
hoping to join a performing group at an appropriate level. At the same time, even
more effort is needed if the cluster is to develop a greater level of interconnectivity,
indicating that Centre Stage represents a starting-point in the drive to co-ordinate the
local music community and improve opportunities for both the professional and
amateur.

7.8 Music Library Provision.

There can be little doubt that there is a growing need for music library provision: as a
result of the increasing specialisation within music, the successful provision of music
above the most basic level requires expert providers to identify and supply appropriate
music information and materials to meet the needs of the community they serve. As
access to collections is more widely advertised and the collections become better
documented, especially electronically, barriers to the use of specialist libraries by a
wide range of users is diminishing, aided not inconsiderably by the requirements of
project funding bodies. This is important, because the subject area of music is now so
wide that no music library can ever be comprehensive. At the same time, users need
access to the widest possible range of providers, whether through personal visits,
remote access or interlibrary lending. The distinctions are beginning to blur, aided in
part by nationally promoted access arrangements, although a concrete access strategy

36
This has the effect of undermining one of the stated commitments of the Arts Council in the so-
called Glory of the Garden document (1984) to the presence of resident musicians in the East of
England region.
37
Centre Stage, a database of this type, is currently being compiled by Andrew and Michael Wilson at
Clement Pianos, in response to the perceived demand. Quotations from commercial web design
companies are being sought to make this accessible through the internet. An additional purpose of this
information would be to provide guidance to amateur performers seeking tuition, or hoping to join a
performing group at an appropriate level for them.
36
across the sectors will probably only be achieved within the framework of a true
national library strategy.
Given the highly diverse nature of music library users, from academics and
researchers through to music teachers and students, not to mention professional and
amateur musicians and casual music hobbyists, this service is clearly a valuable,
indeed crucial, support to musical activity in the City of Nottingham at a variety of
levels. Any music library also has an important cultural significance: it provides
access to material for study or enjoyment without the barriers which spoken and
written language can impose. Music libraries can therefore be seen to support the
interests of an exceptionally wide range of different users with the most varied needs
and interests. They also underpin the most wide-ranging types of musical study,
performance and enjoyment. Music in libraries, appropriately exploited, can give
immense added value to the library, to its users and the region. This provides a strong
justification for examining the economic, cultural, social and educational factors that
influence the content, direction and development of music libraries.
In short, continued access to a properly organized and professionally-staffed
music library in Nottingham is crucial to amateur and professional alike; it should be
seen as a vitally important cog in the musical life, education and development of new
initiatives in this city.
38


7.9 Instrument Manufacture and Retail

Debates about exactly which types of activity should be included within the thirteen
recognised DCMS creative industry sectors often focus on the role played by
retailing, given that as it is not necessarily a creative activity involved in content
origination, even if it is selling the products or the means of creative endeavours. As
far as the music sector is concerned, however, it is surely impossible to dismiss retail
outlets as a whole. In Nottingham, as in many other cities, retail outlets - especially
those which deal in musical instruments, spare parts, repairs and servicing or sheet
music - are vitally important to both the sector as a whole and the process of
clustering. They usually perform the crucial role of meeting places, advertising
facilities and information exchanges. Furthermore, they often act as agents for much
smaller businesses such as technical services, for example, instrument repairs and
servicing. The technicians who do the work are usually only loosely associated with
the company at whose premises they work, perhaps calling in periodically to
undertake orders as these arrive at the parent business. These tasks may be charged
through the main business account, with the technician receiving a portion of the
price. Such technicians usually undertake similar work in other businesses, as well as
doing freelance work on their own behalf. Many promotional services, as well as
tuition, instrument hire, recording and CD duplication services, are also offered in this
way through an association with a retail outlet.
In the Nottingham area, the retail outlets seem to be even more important to
the cluster as a whole than in larger cities, such as Birmingham or Manchester. One of
the most striking findings of our research was that central Nottingham has a
significant number of specialist retail outlets for musical instruments within a
relatively small area. This contrasts sharply with Birmingham, which has witnessed
the demise of two large musical retail outlets in recent years, both for rather
anomalous reasons. Indeed, several retailers believe that purchasers are choosing to

38
This section quotes freely from Lewis and Thompson, Access to music, op. cit.
37
come to Nottingham in order to purchase new or replacement instruments in
preference to visiting a larger city with a more obvious musical pedigree.
A number of small and micro- businesses contribute to the music retail sector,
which is itself fed with trained instrument makers and repairers by Newark Technical
College. Furthermore, Nottingham and its environs were considered by many of these
retailers and makers to be an excellent distribution centre, both for instruments
manufactured in the UK, which have a reputation for quality and an association with
status in the Far-East, and for imported material which has been sold on through the
internet or by mail order. At the same time, although a large part of the instrument
retail business is now conducted through mail order, and the majority of instruments
sold are imported from China, Korea, Germany and Austria, one should remember
that this is a highly specialised market in which hands-on trial of the products and
decent demonstration facilities and advice are key issues.
A number of Nottingham businesses are widely regarded as excellent in these
respects. Clement Pianos, for example, an important piano retail and repair business
which is developing important European and Asian links, stage an annual festival at
which piano manufacturers demonstrate newly-designed models. Millenium Software,
a music-technology company, and the first in Britain to build computers specifically
for music-related activities, offer a range of high-technology products, many of which
they build themselves. Similarly, M-Corporation has started to sell this range of
products, placing customer liaison at the heart of their operation. More traditional
companies such as Windblowers and Turner Violins have designated demonstration
facilities where customers can play in private rooms, without feeling pressurised or
inhibited. These retailers agree, however, that the influx of visitors and potential
purchasers which these businesses bring into Nottingham could surely be improved
through the availability of city-centre demonstration facilities, even if these are small,
shared facilities which merely act as a shop window for the key products, while the
main premises remain on the periphery of the city. Indeed, two important businesses
in the retail sector which are clearly capable of further expansion have discussed their
interest in acquiring city-centre premises of exactly this type in order to raise their
profile by increasing opportunities for demonstrating the latest products, some of
which are stunningly innovative. While they recognise the difficulties associated with
transferring their entire business into the city centre, the establishment of shared
facilities would act as a retailing hook capable of drawing (and retaining) clients
into the city area. In this way, it would be possible to form a creative industrial hub
that would act as a powerful magnet for purchasers and music-related networking
alike.
Another important aspect of the music community was the success of the
training programmes offered by teaching studios such as The Square Centre and
Confetti Studios. Not only do their courses draw students to the city from all over the
UK, many of the students remain in Nottingham after completing their courses,
subsequently contributing to the burgeoning activity of the sector by working in, or
establishing and developing micro-businesses. These are typically small commercial
studios and practice centres, rather than teaching-orientated studios, as well as
independent record labels, creating a much more dynamic character that could be
developed further as a means of stimulating cluster growth and diversification.

7.10 Studios: Commercial Recording and Teaching

38
There can be little doubt that Nottingham is fortunate to have a number of recording
studios. Moreover, they seem to function as a cluster within the music community. At
least seven businesses of this type have been established within the city since 1993,
several of which are involved in teaching and training recording technicians and
sound engineers, as well as commercial recording projects. Others, it should be stated
at the outset, prefer to concentrate on commercial recording alone, arguing that no
studio can tackle both activities efficiently. Some studios engage freelance engineers
and technicians for larger projects, while others conduct peripheral activities such as
hiring equipment and services to outdoor concerts and music festivals, hourly-paid
teaching on music technology courses at FE colleges, as well as sub-letting parts of
their premises. Parts of studios are often sub-let to other smaller recording operations,
with practice rooms frequently rented out, usually on short lease arrangements rather
than on hourly terms. While these peripheral activities provide an important regular
and reliable income stream for these businesses, they should also be recognised as a
form of outreach to the cluster itself, as they enable smaller businesses to progress and
local bands to rehearse, thereby providing an effective way of building networks.
Furthermore, some skill sharing occurs when freelance engineers involved in
collaborative projects receive training on the specific items of studio equipment with
which they are not already familiar.
Many of the studios are located in, or close to, the city centre, where they can
be readily accessed and are close to other businesses. This proximity is vital, because
the production of commercial recordings often involves collaboration across several
businesses, from large-scale CD duplication or vinyl-pressing to photographing
artwork for covers and publicity. In addition, new jobs have been created that have
absorbed some of the large numbers of students currently completing music
technology BTEC courses in Nottingham. On the other hand, some recording
engineers noted that in view of the highly competitive nature of the studio sector, a
BTEC qualification does not provide the appropriate level of expertise required when
working with the latest technologies. This reveals the vital importance of practical
experience to this sector, because employers are only likely to take on engineers with
many years of experience. This presents a major challenge to the FE colleges affected,
indicating that the educational sector needs to develop much closer links with the
studio sector if more effective local use is to be made of the investment in training.
Another dimension of the city-centre locations chosen by these studios is their
extensive use of large commercial buildings which are so archaic that they would
otherwise probably be empty, as they are in run-down areas of the city and are totally
unsuitable for office and service-industry development. At the same time, if the
benefits of city-centre studio location to both the music community and city are to be
sustained, the availability of premises with affordable rents and leases will be of
paramount importance. A Nottingham-based investor in commercial property who
also works voluntarily as an advisor with EMDA envisaged a rise in commercial rents
and leases in Nottingham as the region becomes increasingly economically buoyant
and expands its service-sector orientation.
At the moment, even though the links with HE seem to be only partly
developed, there can be no doubt that the training programmes in the use of high-
technology equipment offered by some of the studios are bringing erstwhile students
into the city as residents. Inevitably, only a small proportion of these are going on to
work in, and in some cases to run, small studios and independent record labels. On the
other hand, others are finding work which involves the design and construction of
music-related high-technology products. This is crucial to the further development of
39
a Nottingham music cluster, in that both of these areas of activity encourage a
concentration on types of music which rely on technology, creating a regional
speciality in Nottingham that could be exploited further as a means of diversifying
the clusters range of activities. One example of this is how Nottingham DJs,
purveying a form of high-technology-related youth music, are now finding
employment through a specialist agency in the city. Some of these are travelling
abroad, even to the Far East. A major festival, perhaps celebrating and raising public
awareness of this aspect of Nottingham cultural life, would surely be attractive to
sponsors. As much of this business is now international, non-advertised and
conducted through web-sites, there are additional opportunities for attracting
sponsorship which would be beneficial to the city economy as a whole. While this is
undoubtedly a specialised market sector, and clearly the propensity to switch from
one fad to another creates difficulties, it is part of the rich tapestry of musical genres
that make up the musical community as a whole. Crucially, it is the development of
these new sub-sectors that will provide the future growth trajectories, reinforcing the
established strengths and offering new economic opportunities alongside the old.

7.11 Conclusions: receptivity to clustering.

One of the most important conclusions arising from this research has been that four
general business profiles seem to have developed in the Nottingham area. These
profiles are:

Type 1: Large promotional and performance venues with turnovers well in excess of
1 million.

Type 2a: Nottingham-based manufacture, servicing and retail businesses with about
5-10 employees. These businesses offer an array of additional services through
extensive involvement with clusters of associates, and have turnovers between
300,000 and 2 million. These businesses tend to have an important involvement
with other local businesses, advertise locally and are important promoters of local
musicians and events. Some of them make use of local musicians in their promotional
and advertising work

Type2b: Nottingham-based recording studios, providing both studio facilities and
training in the latest equipment. While local musicians use these facilities, the studios
are available to groups and bands that originate outside Nottingham. Those that
provide training also attract and develop people with the skills to complement existing
expertise.

Type 3: Retail businesses which are part of a chain with a headquarters outside the
Nottingham area. Typically, they have 5-10 employees and turnovers between
300,000 and 2 million, offering a limited range of additional services. Crucially,
their involvement with associates, with local businesses and interaction with local
musicians is limited. They often use musicians from outside the area to do
promotional work. The lack of local involvement is to some extent related to the lack
of managerial autonomy in such businesses, providing little incentive for employees
to create links.

40
Type 4: Independent businesses involved in playing, teaching, promoting, recording
or small-scale manufacture, retail and servicing. Most have only one or two
employees, but they are connected to a wide circle of associates. Their turnovers
rarely exceed 50,000, and frequently are far less.

Type 4 businesses are by far the most numerous; there are literally hundreds of them
in the Nottingham area. A complete list could never be prepared, as so many are
parochial teaching-performing enterprises with turnover figures of no more than
10,000, or even less in some cases. Many of them utilise word of mouth and the
networking possibilities which Type 2a businesses offer in order to obtain customers,
pupils and engagements without using advertising to any significant extent. Many of
the type 4 businesses were unaware that this sector of the Nottingham economy seems
to be functioning as a micro-cluster already; others considered that their ambitions
could be fulfilled in isolation. Nevertheless, it seems likely that additional mutual
benefits and further expansion could be achieved by making type 2a, 2b and some
type 4 businesses more aware of both the general benefits of clustering and the
activity of other members of the cluster.
Businesses in the type 3 group were in a position to contribute to the cluster,
but were simply insufficiently aware of other operatives in related areas who could be
of benefit to themselves or their clients. In some cases, the local management of type
3 businesses were either insufficiently autonomous to be able to take decisions, or
were not given the incentive from higher levels of management. Certainly, the
possibility of meeting other practitioners through networking meetings and focus
groups was most warmly welcomed by type 2a, 2b and type 3 businesses. The type 1
businesses were also interested in the idea of clustering, although some of these had
already taken steps to increase customer base by creating their own discussion groups
at a strategic level.
Above all, it is clear that inter-business communication was less widespread
and probably less effective than in other sectors. One of the reasons for this was a
reluctance to use information technology as extensively as other creative sectors such
as digital media. Indeed, some of the traditional businesses in types 2a, 2b and 3
including sellers of music, instruments and repairers of instruments - use e-mail or the
web very little. Some music-related businesses from types 2 and 3 were found to be
restricting web access to a few designated employees in order to keep costs down and
prevent time-wasting. One important music business in Nottingham recently
abandoned its on-line ordering service, preferring to work via the telephone, in order
to avoid the mistakes resulting from incorrect transcription of the orders. These
mistakes can be avoided, they believe, by confirming all orders verbally. Another
business, a large type 3 music-technology and instrument concern, offers no access to
the internet for employees, who need to telephone through any message they wish to
be sent by e-mail to their head office, whence it is sent on by a secretary!
It is consequently important to recognise that strategic discussion needs to take
place in a variety of ways, and should not be confined to virtual communities. This
is not to say that the sector is generally unwelcoming to new ideas quite the reverse
in fact. In many cases, interview subjects were well aware that they were music
professionals who have diversified from traditional activities such as musical
performance, instrument-making or related technical work to acting as business
professionals, readily admitting the amateurishness of the sector as a consequence.
Others were conscious that they were working largely in isolation, realising that their
business strategy is often conducted on a trial-and-error basis. Consequently, many
41
of the practitioners in types 2a, 2b and 4 would welcome professional advice on
marketing and strategy, applauding the possibility that the business school may be
able to place some postgraduate marketing students with businesses as part of their
MBA programme.
Having noted these constraints, it is nevertheless apparent that many type 2a
and 2b businesses are already highly effective hubs of interaction with other
businesses, promoters of networking and quite effective facilitators of clustering
activity. Some of them might even be considered key agents who are thoroughly
embedded in the cluster. Future policies must consequently recognise that these
businesses add considerable value to the sector as a whole; activities and policies that
benefit them specifically may assist the sector as a whole.
Our results have begun to demonstrate some ways in which creative businesses
can operate more successfully as a cluster, and to indicate how strategic decision-
making could assist the cluster as a whole. Furthermore, some of the networks
established through the research interviews have themselves begun to assist cluster
development. Examples include:

1. The launch of the CReEM website, providing a means of facilitating
discussion across members of the network.
2. The initiation by one of the main music retailers of a non-profit-making
database (Centre Stage) of performers and teachers of music and relevant
organisations in the region. This is expected to act as both a trade association
and regulatory body.
3. The initiation of a focus group which will attempt to coordinate CD and
music-related book sales with HE and FE courses and with concert promotion
in the area.
4. The initiation of dialogue between concert venues and local musical
organisations over access to venues and hire charges.
5. The proposed development of Lector Studiosus, a specialist record label with a
recognisable niche market in the US HE market, as well as an important link
to local creative industries and tourism.

7.13 Recommendations.

Arising out of this research, we would propose:

1: A feasibility study in relation to the provision of a 4/500-seat concert hall in the
city centre should be carried out as soon as possible. It may be possible to use or re-
develop an existing building, although opinions on this differed widely.

2: Consider the cost and availability of commercial property in the City area, a crucial
issue for many businesses in the type 4 group. A number of studio businesses, as well
as the smaller manufacturing and retail operations, are anxious to maintain and
develop a city-centre presence in order to demonstrate new products, although not
necessarily as a main location. The acquisition of more commercial property by the
City Council which could be leased to creative businesses at competitive rates could
provide an important stimulus to the creative sector, as well as providing a focal point
for these activities which could be presented as an attraction to visitors. The scheme
of this type which is operational on Huntingdon Street was praised by a number of the
creative industry tenants.
42

3: The establishment of further focus groups for discussion between planners,
licensees and the music industry (especially concert promoters) is urgently needed.
However, it seems to be clear that it is difficult for such strategic discussion to take
place, especially if they are confined to virtual communities that many firms simply
would not use. These discussions need to be carefully planned, especially by building
up trust between local government officers or EMDA employees who have never
visited these businesses. As trust is not easily won in this sector of the economy,
considerable effort ought to be invested in developing this intangible, yet crucial
asset.

4: Some fine-tuning of the focus groups needs to be conducted. There seems to be a
need to separate cluster-related discussions at strategic level from those at practitioner
levels 2a, 2b and 4 at least, and probably some further careful grouping of
practitioners from particular areas could also be considered. The prevailing view of
the creative-industry-related discussions to date seems to be that they were too
generic.

5: There needs to be a wider recognition that amateur music-making is a productive
stimulus to the local economy, as well as a form of low-cost educational provision for
young musicians faced with fewer opportunities to learn orchestral instruments in
school. Fewer school orchestras and peripatetic teachers operate, and there can be
little doubt that music theory has been marginalized in school music teaching. The
amateur sector also offers a valuable opportunity to retired persons indeed, one
retired school music teacher observed that being able to rehearse and play with NPO
and NSO within a few miles of his home was one of the most attractive things about
the city. Although much of the work in which this sector engages is not necessarily
innovative, it often provides a valuable stimulus and many of its projects seem to
merit a higher level of support by local authorities than they currently receive.

6: There can be little doubt that the Citys musical life benefits greatly from the music
library service, at Angel Row in the City. Nottingham is particularly fortunate in this
respect, in comparison with other cities of comparable size, because this facility is an
invaluable support to amateur and professional music alike as well as to related
activities such as research and concert programming. This resource supports amateur
music making of all types especially through score provision, as well as music
teachers. It also has the potential to support professionals; both performers in search
of material and programmers in search of background information.
43
8. Digital Media.

Although undoubtedly a highly creative industry, especially in the way it incorporates
information technology and design activities, it will become apparent that the digital
media sector is a totally different kind of activity to music. In particular, this is a
relatively new form of business, especially when compared to the longstanding music
industry, while the very nature of digital media means that it is technology-driven in a
way that music has rarely been. On the other hand, this sector is just as creative as any
other in this category, with design and innovativeness featuring high on the
characteristics that employers search for when recruiting staff. Similarly, as part of
our research into clustering activity, digital media provides some highly instructive
insights into the power of connectedness and the benefits of geographical proximity.
In view of the nature of information technology, especially the way in which location
could be determined more by access to a suitable telephone line, the latter seems to be
a paradoxical conclusion. Indeed, one might argue that clustering and networking
occurs in spite of the technology, not because of it, indicating the presence of other
factors that prompt entrepreneurs and managers to gravitate towards certain locations
or activities. A key influence could well be the size of most digital media businesses,
because in this context the sector is similar in structure to music, with a
preponderance of extremely small operations that frequently work in collaboration
with others, rather than in competition. This reveals how the cluster demonstrates
characteristics associated with the third stage of our life-cycle model, Co-operative
Competitiveness, even though the sector has been in existence less than twenty years.
One might even claim that there are Mature characteristics emerging, especially in
relation to web design work, indicating that policy-makers need to start considering
how best to intervene to support a sector that has evolved rapidly. While there is
considerable evidence of a self-help culture within the digital media sector, many
complain that insufficient has been done to support the development of a creative
sector that is based on advanced technology.

8.1 What is digital media?

In tackling this fundamental question, it is crucial to emphasise the link with web
design and other virtual design and development work. A brief scan of Table 8.1,
however, reveals the enormous variety of activities covered by this sector, from
advertising and marketing through to graphics, animation and videos. This diversity
reflects both the flexibility of information technology and the creativity of those
connected to digital media, indicating how entrepreneurial instincts have led firms and
individuals to apply their skills and resources to a host of market opportunities.
Another important factor to consider is the size distribution of those firms
interviewed for this project. As Table 8.2 reveals, while six were sole traders, only
four employed more than fifteen people. Table 8.3 also reveals key information on the
turnovers of those interviewed, with just thirteen indicating that this never exceeded
100,000 and only eight claiming 1 million. While this emphasises the relatively
small scale of Nottingham digital media firms, one must never forget how at times
exactly the same degree of collaboration exists across the sector as in music, with
either firms or individuals working on joint projects over the course of their duration,
then moving on to other forms of collaboration, or even independent work. This
amorphous nature consequently makes it extremely difficult to come up with precise
figures on either employment or turnover across the sector. It also highlights
44


Table 8.1: Services offered by Nottingham digital media firms.

Advertising Marketing collateral
Animation (architectural aspect) Marketing Strategy
Animation (product visualisation) Motion graphics and 3D animation
Artistic and web print Networking
Art research projects Newsrooms
Audio-video production Online and offline branding
Banners Online game
Branding Online presentations
Broadcast work Online touch screen kiosk
Computer Graphics Online and offline design
Content Management Online and offline editing
Character Animation Photography and digital photography
Consultancy, training and workshops Press launch
Creative marketing PR
Copy writing Print management
Design of interfaces for CD-roms,
DVDs, etc.
Pop stars promotions on the internet
Development of intranet/extranet Research
Discussion forums Production of corporate films, videos
DVD authoring Programming
E-commerce Rebranding
Exhibitions Search optimisation
Email marketing Sound effects and music
Full 3-D Flash website Trend prediction in terms of design
Graphic Design for print Video editing
High definition Virtual reality
Hosting Virtual product demonstration
Interface design Website updates
Literature production Website design
Logo Design

Table 8.2: Employment in the Interviewed Firms.

Number of employees Number of
interviewees
Sole traders 6
Between 2-5 14
Up to 15 11
More than 15 4
Total No. of companies
35
45
Table 8.3: Turnover of Interviewed Digital Media Firms.

Less than 15,000 4
Below 100,000 1
Approximately 100,000 8
130,000 400,000 6
About or over 500 000 4
About or over 1 million 8
No reply 4
TOTAL 35

the highly heterarchic nature of a sector that is just as creative as any of the other
sectors categorised under the heading creative industries.
Having made these introductory comments, one can derive nine core aspects
of the sector from the thirty-five interviews (see Appendix D) conducted with digital
media firms:

1. Virtual reality: The existence of the worldwide web means that web design
companies do not need to consider geography when locating their firms. Even when a
link needs to be established with printing activities, it is still possible to transmit
everything electronically, regardless of distance. Some digital media firms have never
even met some longstanding clients, significantly broadening the market reach of
Nottingham-based firms out of the locality and into the global marketplace. On the
other hand, a considerable number of the digital media firms and entrepreneurs work
in the city centre, indicating how physical proximity is still regarded as crucial to the
collaborative nature of the sector.
2. Networking activity: A clear understanding of the idea of inter-firm collaboration
features prominently in the activities of most firms and individuals linked to digital
media. While younger companies were often more resistant to clustering than the
more mature companies, personal links across the sector have clearly proved to be a
crucial form of communication concerning both business trends and other creative
interests like art, music and design. While some entrepreneurs work from home, direct
personal contact has consequently become an essential modus operandi for those
investigating new commercial and creative links.

3. Nature of the Business: Most respondents were concerned with how best to label
their business. Most of them do not consider themselves as solely concerned with web
design, because it implies certain constraints, especially in terms of a companys
profitability. They would much prefer to regard themselves as multimedia
professionals who are open to a wide range of challenging and customer-focused
assignments.

4. Ideas-based business: Most respondents agreed that web design is a highly
specialised business that links with a series of other creative sectors (design and
audio-visual recording, for example). While most interviewees accepted that because
they are in business they have to acknowledge their customers requirements, they
also try to stick to their own creative credo and guide customers accordingly.
46
5. Historical perspective: The sector has only been in existence for such a short
period of time, with most companies having operated for less than five years. Some
originated in graphic design companies or other types of creative activity. Crucially,
as we shall go on to examine in the next section, a significant proportion of the people
involved in digital media are young, creative individuals who combine knowledge of
the technology with design and other skills. This characteristic is essential when
considering the life-cycle model of cluster development.
6. Business-to-business relationships: The bulk of the business conducted by digital
media firms is predominantly with other businesses. They are consequently
competing against other design companies in almost every pitch. On the other hand,
this business-to-business relationship can be seen as an advantage for cluster
development, because a commonality of interest emerges in their communications,
whether electronic or personal. This also creates an opportunity for large and small
firms to work together, providing the basis for that symbiotic relationship that
characterises much of the creative sector.

7. Self-fulfillment: A principal thrust of the sector is its creativity, as opposed to the
mundane repetition of website design, videos or movies. As one respondent noted:
Its not my intention to conquer the world and make a lot of money. The reason why
Im doing this is because I enjoy it and also because it offers me an opportunity that
Ill never get a job. This confirms one of the themes developed in section ??, that
involvement in the creative industries relates more to personal commitment and
enthusiasm, rather than purely commercial incentives.

8. Casual Nature: Just like their counterparts at Microsoft in Seattle, web designers
rarely wear business suits or other formal attire. Most of them think of themselves
more as businessmen, leading them to adopt an outgoing approach towards their
work, colleagues and clients.
9. Offering a total solution to customers: Most respondents agreed that offering a
total solution is a key to their business prosperity. Driven by technological
innovation, complexity and knowledge development, digital media firms try to share
expertise with their customers as part of their proactive nature.

8.2 Personnel and Company Profile.

While these nine essential characteristics provide some useful insights into the digital
media industry, it is also necessary to create a detailed profile of the people involved
in this sector and how human resources are honed at the corporate level. In the first
place, and reflecting issues raised in the last section, the educational background of
digital media entrepreneurs and employees is highly diverse. While a significant
proportion took degrees in either business studies or design studies and graphic
design, others studied subjects like history, architecture, chemistry, drama and
engineering. Moreover, even where individuals were educated in subjects linked to
digital media, it is apparent that the techniques learned at university were always
extensively modified by the practical experience of working either with colleagues as
part of a team or with customers.
In this context, it is clearly vital to understand the sectors organisational
dynamics, because the management structure chosen by an individual firm can have a
47
crucial impact on both the way information is transmitted amongst employees and
how decisions are taken. Three types of management structure were identified during
the research: a flat structure, a role-based structure and a combination of both
structures.
A flat management structure. This type of structure is the most popular amongst
Nottingham companies. One of the reasons for this is the highly informal manner in
which business is conducted. Another reason relates to the partnership agreements
used by many firms, in that many are based on real friendships. The third reason for
avoiding titles such as CEO or MD is rooted in the size of the company; because most
companies are small size, people cope with different tasks.
Role-based structure. This type of management structure can also be encountered in
Nottingham multimedia businesses. It is employed mainly by companies employing
more than a dozen people, providing greater definition across the firm. In particular,
role specification is used as a means of handling either individual projects or groups
of people, while frequently there is also a creative director responsibly for co-
ordinating activity across the firm as a whole. These firms are also likely to employ
external consultants copyright consultants, PR consultants and sales and
management consultant providing an organisational challenge if this advice is going
to be effectively linked into company strategy and structure.
A combination of both structures. In some companies, it is difficult to discern any
particular kind of structure, with people and processes handled in a highly flexible,
non-hierarchic manner, yet at the same time with some allocation of responsibility,
especially for individual projects. The rationale for this approach is based on the
notion that all staff are regarded as multidisciplinary, contributing from a variety of
different perspectives to the completion of contracts and projects.
Given the extensive employment of especially the flat management structure,
another crucial issue is the recruitment patterns employed by digital media firms.
While in most firms recruitment revolved around pursuing that elusive combination of
personal and functional skills, four features recurred constantly in the profile of
potential employees:

Creativity and problem-solving ability
Ability to work in teams and with clients
Business confidence
Technological awareness.

Surprisingly, perhaps, especially given the rapid advance of IT over the last decade,
the latter was often regarded very much as a secondary consideration, with team-
working, personality and inventiveness coming much higher on the list of priorities.
This reinforces what was said in the last section about the creative nature of the digital
media sector. At the same time, given the small-scale nature of most digital media
firms, it is often difficult to spare either the time or resources to develop this talent,
placing considerable emphasis on the individual to learn from personal contact with
others in the sector. There is also no particular preference for graduates from IT
degrees, given the special emphasis on creativity and personality. As one interviewee
noted:
48
Everything depends on the person. To me, it wouldnt matter if the person is
45 or 17 but the way he or she handles things a telephone manner,
intelligence and sharpness. I wouldnt jump straight onto a graduate because
he or she is a graduate. I wouldnt employ somebody because theyve been
working in this field for 20 years just because theyve been working for 20
years.
This brings up the key question of training and how it can be funded.
8.3 Training

When discussing this issue, it is first of all important to differentiate between the
various types of training that are both required and conducted in digital media. On the
one hand, there is an essential need to keep pace with technological developments in
IT, some of which can be provided externally. On the other hand, new recruits
frequently require training in general business skills, given their background either as
designers or IT experts. Indeed, this is the area on which most emphasis is placed by
digital media firms, rather than on IT training, because firms recognise the paramount
need to ensure that resources are utilised to their maximum. Overall, though, there
would appear to be a strong preference for learning-by-doing; almost a sitting by
nellies elbow strategy of human resource development. In large part, of course, this
approach arises out of financial necessity, because outsourced training is extremely
expensive, especially in view of the limited resources of the sectors typically small
firm. As a consequence, a considerable proportion of the training is done internally,
through senior designers who pass on their business and technical skills through
constant personal interaction, both within and outside the firm. This means that staff
development is very much an iterative process, the bulk of which takes place on-site
and through careful nurturing by senior staff.
How effective are these ad hoc training methods? There is clear evidence that
firms will try to experiment with novel team-building exercises one firm mentioned
going to play bingo, or hill-walking bringing a sense of the collective to human
resource development. Many were also sceptical of the benefits of outsourced
training, in that staff would be sent on programmes that would rarely contribute
directly to their immediate activities in the short-term. Indeed, by the time they came
to consider applying these new ideas or techniques, they would have to go on
refresher courses to relearn them. Moreover, selecting the most appropriate external
programmes posed a major difficulty for many firms, because the quality of provision
is often of only mediocre quality, and even less relevance. Ultimately, for most firms
an internal brainstorming session is regarded as the most appropriate way in which to
deal with an issue, rather than sending senior or junior staff to an expensive external
programme of dubious merit. When this issue was raised with one-person operations,
it is interesting to discover that where the lack of basic business skills emerged as a
problem, the entrepreneur frequently engages in an exchange agreement with another
firm. For example, one individual provides a free website service to a law firm in
exchange for free legal advice.
Given this attitude towards training, one must inevitably consider the extent to
which HE can support digital media firms. As there seems to be a particular problem
with the development of business skills, the creation of a Creative Industries MBA
would provide the kind of high-level preparation for work in this area, especially if a
part-time version was made available in the evenings or at weekends. This
programme could also tuned into the immediate needs of the firms sending students,
49
for example, by introducing an action-learning element into the dissertation and
project work. On the other hand, the smaller firms might prefer much more practical
courses that deal with immediate problems. It is an area that requires much further
discussion across HE and digital media, providing a strong justification for the
continued operation of our focus groups.
To take the specific issue of communication skills, it is interesting to note how
the sector has approached this area. Of course, these skills are essential because:
firstly, it is vital that ideas are expressed clearly; secondly, when dealing with
customers one must be personable and responsive; and thirdly, team-work is such an
important part of the work pattern. Accordingly, firms place considerable emphasis on
developing the ability to communicate, in order to engender an exciting, challenging
and committed work environment. Again, however, this is an internalised process,
rather than something that is devolved outside the firm. This re-emphasises the
organic nature of firm development within digital media, a characteristic that
alongside the small-firm mentality leads to a strong antipathy towards externalised
training.
8.4 Local Support Mechanisms

Opinion varied considerably on the extent to which national government, city and
county councils, local development agencies and banks provided the kind of support
required to nurture a digital media sector in Nottingham. On the one hand, there were
those who claimed that either no support was required or that existing mechanisms
were sufficient. Conversely, others felt that the sector was left to fend for itself in the
wake of competing demands for resources from other sectors, both creative and in
other parts of the economy. These issues were also discussed at the digital media
focus group, where accusations of favouritism were levelled at some local
institutions in the way that resources were allocated. This reveals a range of problems
with the way in which digital media is (not) supported, providing the basis for some
of our stronger recommendations (see section 8.??).
Although a range of schemes are available to small firms, provided by
institutions and programmes as diverse as the European Commission, Nottingham
City Council, EMDA and Business Link, widespread concern was expressed about
the nature of these schemes. Inevitably, several interviewees were disdainful about the
level of support, especially at the start-up phase or when looking for suitable
premises. This kind of complaint also revealed a considerable degree of ignorance
concerning how support schemes could be tapped, given the excessively bureaucratic
nature of applying for funds. Moreover, there is a feeling that because of their
intimate links with local arts groups or political institutions, some firms have been
able to monopolise the routes to support aid. This cosy circle is also extremely
difficult to penetrate, given the highly personalised nature of the links and the way
that they are nurtured at sports or social clubs. While it is difficult to substantiate this
kind of accusation, the very existence of such strong feelings reveals some problems
in the way that digital media firms perceive support opportunities.
Having noted these complaints, it is nevertheless worth emphasising how a
significant number of firms regarded the level of support as adequate, especially in
funding access to new developments like broadband or training. Of course, these
comments could well have come from those which were at the heart of the cosy
circle just mentioned. Even here, though, many felt that it was often difficult to find
the right ways to open up the most effective routes to the support mechanisms.
50
Interestingly, interviewees frequently used the word luck when talking about the
support received from EMDA or the City Council, reflecting a concern with the
inability of these organisations to publicise their support schemes adequately.
The third type of comment received on this issue was, perhaps, the most
surprising of all, namely, that the digital media sector needs no public support because
of its vibrant and dynamic character. This attitude is born of a fear of political
intervention, in that some entrepreneurs feel that government-related bodies know so
little about the creative industries that it is preferable to keep them at arms length.
Indeed, there was widespread criticism of the quality of both the advice and schemes
available to the creative industries, indicating the existence of a gulf between the
firms and those who might be willing to support them. This credibility issue must be
resolved speedily, alongside the communication problem already mentioned,
otherwise the sector will find itself excluded from schemes that have been designed
specifically to alleviate key aspects of its development.
A final issue worth discussing in this context is the relationship digital media
firms enjoy with their banks. One could anticipate severe problems in this area, given
the nature of creative activity and the propensity of most banks to develop an indirect
relationship with clients. Overall, though, while some complained about the inability
of local bank staff either to understand the sector or develop a close relationship, there
would appear to be few problems in this area. Indeed, given the sectors intensive use
of the internet, many were happy to use this aspect of contemporary banking practice
and rely on e-mail communications with the local office. The extent of financial
support and advice was also regarded as adequate to most firms needs, confirming
the general view that in spite of the change in banking practices over the last decade
the digital media sector has been well supported by the major financial institutions.

8.5 Competition, Local Networks and Future Trends.

Although there are possibly as many as 150 digital media firms in Nottingham, one
should never gain the impression that the sector is characterised by a highly atomistic
competitive structure. Given what was revealed in Table 8.1, indicating how digital
media firms cover a highly dispersed range of services and markets, it is likely that
each firm will have a range of between three and six local companies against which
they will compete for contracts on a regular basis. Again, though, it is vital to qualify
the notion that intense competition prevails, because while most designers are
extremely protective in terms of their ideas and securing new customers, many
interviewees expressed a willingness to collaborate with rivals. The two principal
reasons behind this heterarchic tendency are: firstly, some contracts are too large for a
single firm to complete; and secondly, projects that require a lot of specialist expertise
can only be completed satisfactorily by combining the skills in different operations.
This further substantiates Shorthoses (see section ??) claims that the creative
industries are characterised by a highly amorphous work pattern, involving an
extensive cross-pollination of people and ideas from one venture to another.
Complementing this collaborative process is the issue of locality, namely,
knowing people in the same trade and networking. This process is substantially
assisted by the sectors ability to recruit almost all of the talent it requires from the
local job market, rather than having to advertise nationally. The creation of informal
groupings like SecondWednesday and websites like www.shoutout.info also reinforce
the level of cohesion across this group, providing opportunities to discuss matters of
mutual interest in convivial surroundings. Another vitally important networking
51
centre is the Broadway caf bar, where digital media (and other) people meet to
exchange ideas and learn about new developments in an unregulated atmosphere that
would appear conducive to cultural exchange. On the other hand, as we shall go on to
explain in section 8.?, there was a general demand for an agency that would act as
both a publicity vehicle for digital media firms, as well as a networking medium
capable of reaching as many firms as possible. Whether this medium should be
organised and funded by the industry, however, remains a moot point, an issue to
which we must return later.
While digital media is characterised by this cohesive character, there are
clearly some important trends that might upset this delicate balance between
heterarchy and competition. In the first place, several mentioned the perceived threat
from what were pejoratively described as bedroom designers, or amateurs who were
capable of designing and implementing a web site. In view of the increased output of
IT graduates, not to mention graphic designers and other related subjects, combined
with the growing sophistication of off-the-shelf software, this amateur sector will in
the future undoubtedly expand. Similarly, with the expansion of the voluntary arts
sector, digital media firms were being undercut by work done on a range of projects.
This reflects the growing maturity of a technology that is now universally available,
rather than the preserve of a highly trained elite of web site designers and IT
specialists. Referring directly to the life-cycle model of cluster development, it is
consequently essential to encourage firms to diversify away from web design as a
means of limiting the stifling impact of saturation.
Another related issue is the prediction that the industry will in the future be
dominated by a small number of bigger players that are capable of using their greater
resources to control the market. With competition intensifying from the bedroom
designers, thereby squeezing out the smaller and one-person ventures, it will only be
the larger firms that will be capable of operating on smaller margins. The recent
downturn in advertising expenditure has also compounded this problem, because
again the larger firms have been able to offer more competitive prices. As customers
are now looking more for one firm to provide a variety of services, this will impose
even greater problems for the smaller ventures that lack the resources to diversify
activities. Furthermore, web site design is slowly moving away from being a design-
led medium to one that is technology-led. Several interviewees noted how in future it
will be more common to present designers communications in a film-type format,
rather than flash design. The imminent onset of 3G mobile technology will also
impact decisively on the sector, with as yet unpredictable consequences.
These developments confirm our belief that in spite of its relative youth,
certainly compared to the music sector, digital media is already reaching a mature
stage of development. Moreover, this maturity is forcing companies and individuals to
respond by finding new ways of working. Although the changes are only just
beginning to creep in, there seems no doubt that the excitement of the 1990s has
passed and firms are searching around for new opportunities. Whatever the trend,
however, partnerships between companies continue to feature prominently in this
sector, indicating how the collaborative instincts of the creative industries remain as
powerful in digital media as in any other sector.

8.6 Conclusions: receptivity to clustering.

One of the most striking features of the research we undertook on the digital media
sector is the high level of awareness that respondents demonstrated to both their
52
competitors and customers: it is a highly intimate community. At the same time, just
as we did with music, it is necessary to identify the various types of operations that
characterise digital media in Nottingham. These are:

Type 1: Multimedia companies with links to firms outside the region.

Type 2: Nottingham-based traders who work almost solely with local customers.

Type 3: Organisations (for example, Nottingham City Council, Arts Council, EM-
Media, Broadway Cinema, New College of Nottingham, Nottingham Trent University
and University of Nottingham) that employ staff to design and develop digital media
products for internal consumption.

Type 4: Computer shops, wholesalers and representatives of Internet provider
companies.

Just as with music, Type 2 operations are by far the most significant numerically,
while Type 1 dominate the sector because of their inherent ability to mobilise greater
resources and provide a wider range of services. It is these two types that have been
by far the most significant as far as this project is concerned. At the same time,
inevitably they will come into direct contact with the other two types of digital media-
related operations, whether to purchase equipment or consumables or to talk about
digital media issues with personnel from Type 3 organisations. As far as the latter are
concerned, while they are far larger than the first two types, little competition
emanates from this sector because they are principally concerned with their in-house
requirements, rather than selling services to the Nottingham market. They have also
purchased services from Type 1 firms, indicating their importance as consumers. On
the other hand, in recruiting valuable human resources and offering more secure
employment, they could be regarded as a constraining factor on the development of
digital media, given that Type 1 and 2 firms frequently cannot compete in terms of
salaries and security of tenure.
As far as clustering and networking is concerned, it is apparent that digital
media firms are generally enthusiastic about talking and working counterparts in
Nottingham. Moreover, this sector interacts with other creative industry sectors,
especially printers, photographers and other visual-aid industries in order to complete
commissions. Collaboration is almost inherent in the nature of the work performed by
digital media firms, highlighting in graphic form the highly amorphous nature of
creative industry work, an issue to which we have alluded many times in this report.
In view of the strong emphasis on clustering and networking, it is
consequently apparent that a high level of trust exists in the digital media sector.
Certainly, relatively little poaching occurs, whether of customers or staff, while many
firms will often recommend rivals for contracts for which they are unsuited. It is
especially apparent that poaching would represent a major threat not only to the firms
position with the digital media cluster and general reputation, but also social life.
There are inter-firm football games and extensive socialising as part of this trust-
building across the sector, reaffirming the heterarchic nature of firm relationships.
One should always be careful not to idealise this degree of interaction, given the
inevitable barriers to communication arising from the need for commercial
confidentiality or contractual arrangements. It is also apparent that institutional factors
limit the degree of personal interaction, in that the Lace Market area of Nottingham
53
has not yet been provided with broadband links, limiting the proximate location of
digital media firms.

8.7 Recommendations

A series of recommendations can be made as a result of embarking on and completing
this research. These have been broken down into various categories, ranging from the
specific to the general.

Promoting the digital media sector

secure funds to facilitate effective communication between firms and potential
clients and across the sector as a whole, whether online or through direct
interaction

Develop online resources for professionals working on similar or related areas

Organise trade delegations to other areas, extending the market horizons of
small-scale firms that do not possess the resources to advertise and market
their services extensively


Training and education

Provide business training for people at the start of their careers, especially
those coming from art or design degrees.

Provide higher-level training for those moving into senior management

Ensure effective communication between local educational institutions
(especially in HE and FE) and the digital media sector


Bureaucracy and Support Schemes

Publicise more effectively the availability of support schemes, especially for
small-scale firms, with case-studies of successful applications

Create a liaison group linking the main support scheme providers and digital
media firms

Provide small firms with more assistance in dealing with governmental
bureaucracy, as well as information on employment law, VAT, national
insurance and regulatory matters

Set up a special web site for design awards

Establish a web site where small companies can access the information about
conferences and workshops

54

Industry bodies

Establish a Design Council either for Nottingham or the East Midlands,
providing a focal point for both firms and customers, with regular exhibitions.
This might also act as a Centre of Excellence for the region, with award
schemes and regular exhibitions

Set up a government body that will establish generally-accepted standards for
digital media

Form a steering committee from people within the industry to feed ideas into
local and regional events and initiatives. This committee might meet in a
social institution that is dedicated to digital media

Establish a central sales agency that provides information on customers

General issues

Limit the city centre car parking restrictions on companies based there.

Introduce legislation that enforces the settlement of invoices within 14 days,
thereby assisting the liquidity of small firms.

Nottingham City Council needs to ensure that adequate and affordable office
space is available in the city centre

Reduce the level of crime in Nottingham.

Offer small firms the use of facilities in educational institutions

Initiate an MBA in Creative Industries at Nottingham University, with
assistance from staff at Nottingham Trent University, Nottingham City
Council, EM-Media, the Arts Council East Midlands and EMDA. Practitioners
would also be recruited as lecturers or tutors

Conduct research into creative industries clusters located outside the East
Midlands, in order to learn any appropriate lessons
55
9. Clustering and the Case-Study Sectors.


Having surveyed the two case-studies that have dominated our research programme, it
is now necessary to link this work with both the life-cycle model of cluster
development and a resource-based view of the firm. While in the last two chapters a
whole series of specific recommendations have been produced as a result of talking
directly with a reasonable number of representatives from the Nottingham music and
digital media sectors, it is also necessary to provide some overriding conclusions that
will help policy-makers to direct their resources and policies as part of the ongoing
process of boosting the regional economy. In particular, as it is now clear from our
research that both sectors are approaching a more mature stage in their development,
one can identify aspects that require refinement in order to prevent ossification and
decline. Of course, in making these recommendations one must be careful to
differentiate between the stages of cluster and firm development, because as we noted
in Chapter 3 in focusing purely on the former it is possible to ignore the crucial
importance of the latter. Similarly, stages in both the trade cycle and advances in
technology must also be accommodated into this analysis, indicating the vital
significance of looking at the sectors in a rounded and balanced fashion. The key
issue would appear to be the need to prevent the dangers of straitjacketing our
analysis and findings by looking only at cluster development, offering
recommendations that incorporate the richness of our raw information and intense
analysis.


9.1 Clusters, Industries or Sectors?

Before embarking on this generalised analysis, it is important first of all to return to
our earlier discussion (see section 3.1) of the nature of clustering activity, reiterating
the point that any research on this subject is complicated by the overlapping nature of
firm development, the trade cycle and stages in technological advancement.
Specifically with regard to the creative industries, it is possible to identify many
aspects of what can be classified as clustering activity. For example, the
preponderance of single-person and small-scale firms, linked with the highly
amorphous nature of employment patterns across these sectors, places tremendous
emphasis on heterarchic collaboration. The principal reasons behind this form of
collaboration revolve around the need to work in teams on projects that would have
overextended a small/one-person operation. Alternatively, different types of skills
might be required to complete a contract or project, obliging ventures to work
together. This indicates how firms secure external economies of scale through
collaboration. Furthermore, the linkages frequently occur as a direct result of personal
interaction, for example around the Lace Market area of Nottingham or at the
Broadway caf. Alternatively, as we saw with regard to the Type 2a businesses in the
music sector, retailers play a vital facilitating role in disseminating information about
market trends, future events and projects, as well as servicing the immediate
requirements of performers, whether professional or amateur.
While these characteristics certainly amount to clustering and networking
activity, indicating the need to focus resources on this economic mode of operation, at
the same time it is equally vital to link this with issues that relate more to the nature of
firm evolution, the state of the trade cycle and specific technological trends that affect
56
these sectors. In simple terms, it is clearly difficult to talk about a cluster life-cycle
when sectors are composed of firms at different stages of development. Moreover, in
attempting to identify stages in the cluster life-cycle one might be confused by
temporary slumps in economic activity, thereby giving an indication that the sector
was either stagnating or declining. Similarly, if one particular technology (for
example, web design) reaches a mature stage of development, this could mislead
commentators into claiming that the sector as a whole is suffering. It is consequently
essential that in analysing the raw data one must overlay other factors on to the model,
bringing out the interaction between general and specific issues, as well as
interleaving trends that affect both firm and sector.
In bearing these points in mind, one issue that recurred in many interviews
with people working in both music and digital media is the existence not of a cluster
per se, but of sub-clusters operating within the sectors. These sub-clusters are
composed of firms that are either at different stages of development or work in
specific sub-fields of music and digital media. This returns us to a point made in
section ??, where it was noted that while there are several hundred firms in each
sector, frequently individual operations would only be competing with perhaps just
half-a-dozen specialists. It was also within these sub-clusters that opportunities for
collaboration arose, especially if a large project stretched the resources of a single
operation, whether in terms of expertise, personnel or funds.
Taking this analysis further, one can reintroduce the matrix linking the RBV
of the firm and resource dependency outlined in section 3.?. This identifies the extent
to which firms need to interact with their counterparts, especially in externalising
activities that are either difficult or impossible to provide from internal resources. As
Figure 9.1 consequently indicates, the vast majority of operations in both digital
media (Type 2) and music (Type 3) fall into quadrant 4 of the matrix, indicating how
their limited resource base obliges them to collaborate heterarchically across the
sector. Only the firms that are linked to commercial operations outside the East
Midlands can afford to operate independently (quadrant 1), while quadrant 2 is
composed mostly of public sector organisations that rely on local connections to
ensure that their resources are distributed across their respective sectors.
Resource dependency
High Low
Internal Hierarchical,
centralised [1]
Type 1 (music)
Type 1 (DM)
Hierarchical,
decentralised [2]
Type 2b (music)
Type 3 (DM)
Resource base
External Heterarchical,
centralised [3]
Type 2a (music)
Type 2 (DM)
Heterarchical,
decentralised [4]
Type 3 (music)
Type 2 (DM)


Figure 9.1 Resources, governance and industry characteristics in digital media
and music.

57
The principal conclusion arising out of Figure 9.1 is the preponderance of
heterarchical activity across the two sectors, indicating how the small-scale nature of
most operations results in a considerable amount of work that would be regarded as
clustering. Furthermore, this clustering would also be based on extensive networking,
given the intimate personal links between firms and individuals. As a consequence of
this analysis, it is essential that we consider the stage which each cluster has reached,
as a means of identifying the challenges and opportunities that face both firms and
policy-makers.

9.2 Life-Cycle Stages.

While in view of the detailed analyses of music and digital media (see Chapters 7 and
8), both sectors have clearly passed through the Critical Mass and Take-Off stages of
the life-cycle model (see Appendix B for more detail on the stage characteristics), it is
difficult to detect exactly where each sector currently lies. This necessitates individual
analyses as a means of making specific recommendations.

Digital Media.

Even though digital media as a sector has been in existence for no longer than twenty
years, such has been the pace of both technological change and market expansion that
it demonstrates all the characteristics of Co-operative Competitiveness. This stage
involves balancing the hierarchical and heterarchical advantages of clustering and
networking as a means of boosting the performance of a particular sector, with rapid
growth in terms of employment and turnover over the last decade especially. It is also
clear that the principal change-agents are extensively embedded within the local
community, in that the Type 2 firms have established a solid base for continued
expansion.

Co-operative Competitiveness (balancing hierarchical and heterarchical
advantages of clustering and networking and achieving competitive
advantage)

- Rapid growth (employment; output; investment; productivity)
- Change-agents entrepreneurial, dynamic and embedded in local networks
- Political-economic balance of interests
- New entrants in core and related sectors
- Further investment in infrastructure
- Extend marketing and distribution networks nationally and internationally
- Market Dominance

Saturation the costs of clustering start to outweigh benefits, with rate of
growth falling away, innovation rare and competition increasing from lower-
cost producers.

- Costs of factors of production rise higher than alternative locations
- Law of diminishing returns (congestion effects) agglomeration diseconomies
- New entrants locate elsewhere
- Change-agents diminish in significance (economically, socially, politically)
58
- Transfer of nexus of power out of the region (economically, socially,
politically)
- Growth rates taper off (output; employment; productivity; investment)
- Infrastructure deteriorates
- Competition from rival clusters intensifies
- Rate of innovation dwindles
- Collaboration shades into defensive activity (cartelisation and price-fixing)
- Institutional sclerosis in local networks


Maturity (rival clusters offer superior advantages for new firms and decline
sets in across the older district)

- Closures, redundancies and downsizing
- Rival clusters grow dynamically
- Rival clusters eat into market share
- Change agents atrophy
- Political apathy
- Local networks disappear
- Disintegration of infrastructure



Renaissance (new industries locate in the cluster, attracted by either cheap
factors of production, demand for their products or the activities of regional
planners)

- Diversification
- Change-agents adopt more proactive strategies
- Closer harmony of economic and political interests
- Price mechanism attracts new entrants (cheaper land/labour/capital)
- Technological and market-based convergence
- Regional Planning
- Revival of local networks and institutions
- Infrastructure innovations (especially in education and training)
- Attract new entrants
- Growth-rates (output; employment; productivity; investment) more positive
- Related sectors expand

Look at postcodes and addresses of interviewees geographical proximity

DOES THERE NEED TO BE MORE INSTITUTIONAL INTERVENTION TO
BOOST CLUSTERING/NETWORKING? Could create artificial environment
and reduce activity

Serena, re. Nottingham losing its lead??? EMDA Pathfinder, p.15, re need to
boost CIs as part of a knowledge-driven economy + Comedia, p.13, re market
towns and city fringes = big CI growth areas!!

59
EMDA Pathfinder: p.17, re. ICT and CIs = big future? + Ward-Brwn, 15 re
Dm as key strategic catalyst

Pathfinder report, re. Creative Challenges, p.6. + Need for more specific
business advice for CIs + strategic intervention to boost activity
+
Ward-Brown, p.7, re. possible areas for strategic intervention

One of the most dynamic, yet under-researched, sectors in the New Economy
consists of what the UK governments Department of Culture, Media & Sport
classifies as the creative industries. Spanning thirteen sectors, from art, music and
dance through to architecture and digital media, employment in these fields has been
increasing significantly over the last twenty years. In the Nottingham area alone, over
15,000 people work in over 1,600 creative firms. This growth is also a clear
indication that the service sector has benefited from an increase in both leisure time
and disposable income, providing an expanding market for creative people.
Furthermore, both national and local government agencies have been considering how
best to stimulate the creative industries, having recognised their importance as an
essential element in a mature and increasingly affluent economy. As part of this
activity, Nottingham University Business School was commissioned to conduct a
detailed study of the creative industries in the East Midlands region, collaborating
with a series of partners (the City of Nottingham Council, the East Midlands
Development Agency, three other local universities and several arts-based advisory
bodies) to produce a report on longitudinal and contemporary perspectives. This paper
will publicise some of the findings of this work, taking a long-term approach to look
especially at clustering, networking and the potential for policy-makers to assist the
creative industries. In particular, the research will look at how the music and digital
media sectors have fared over the last twenty-five years, tracing their evolution
through detailed interviews with over eighty entrepreneurs and related professionals.

One of the principal issues that will be assessed relates to the nature of these
creative firms. As a significant proportion of the firms have traditionally been small
operations employing less than ten people, there is clearly a resources issue. How has
this affected their ability to remain competitive? We shall also be assessing the extent
to which networking has provided the kind of information and resources required.
What role has Nottinghams Lace Market played in stimulating interaction? As the
Lace Market has traditionally been the focal point for Nottinghams creative sector,
how has this fared over time? What assistance has both local and national government
given to this sector? How has this support changed over time? How have the
individual clusters evolved over time? What factors either stimulated or hindered their
development? What role has the tertiary education sector played in facilitating
growth? How does the East Midlands compare with other regions, for example South
Yorkshire or the North West?

By answering these questions and providing a long-term overview of how
Nottinghams creative industries have been developed since the 1970s, an improved
understanding of the local economy will be reached. Although manufacturing
employment across the East Midlands has been in decline sine the 1960s, especially in
textiles, the opportunities afforded by the rise of dynamic creative sectors like music,
dance and digital media provides alternative growth trajectories. This research will
60
consequently feed directly into developing an improved understanding of how at a
local level mature industrial economies are coping with the processes of
deindustrialisation and increased affluence. It will also provide original evidence of
how entrepreneurs have coped with the challenge of sustaining competitiveness, given
the nature of these firms and their limited resources.

One of the fastest growing sectors of the British economy over the last decade has
been the creative industries. Covering a wide range of interests, from the performing
arts through to architecture and digital media, the creative industries have recently
been subjected to considerable analysis by governmental bodies at both the national
and regional levels. In particular, as well as the studies conducted by the Department
for Culture, Media & Sport, localised studies have been commissioned as a means of
improving the flow of information provided to policy-makers when they consider
appropriate plans for such a dynamic sector. One of these studies is based at the
Nottingham University Business School, where extensive research has been
undertaken into the music and digital media industries. Officially entitled Creative
cluster formation: longitudinal and contemporary perspectives on the East Midlands,
this project has attracted widespread support from a range of educational, political and
arts-related bodies.
39

While the principal aim of this project is to assess the ways in which creative industry
clusters have evolved over the last fifty years, applying a life-cycle model to detect
the key stages in this process, the research has produced extensive insights into how
firms across the two micro-studies (of music and digital media) interact. Of course,
the vast majority of the firms included in our research are small and medium-sized
enterprises (SMEs), leading to the inevitable problems associated with a lack of
either resources or time to work on anything other than immediate business issues. At
the same time, given the geographical proximity of most of these SMEs, a significant
proportion of which operate either out of or close to Nottinghams Lace Market area,
there is constant personal interaction and dialogue. Our research has consequently
focused on the durability of these intra-sectoral links, assessing both the long-term
and contemporary perspectives that arise from our work on cluster development. As
networking is clearly vital to the way in which these micro-sectors operate, this work
provides some fascinating insights into the importance of networking to SMEs that
often rely substantially on the information gleaned from personal contact. At the same
time, there has been a growing demand for assistance from local, regional and
national bodies, whether political or quasi-political, indicating that the established
networks have failed to provide all the resources necessary to effective cluster
development.

Apart from feeding into regional cluster development policies, it is clear that our
research will contribute to an improved understanding of networking and network
durability. Having just edited a book (with Andrew Popp) on these issues,
40
as well as
contributed a paper on the dynamics of industrial clustering and networking to the last
BHC conference, this work extends considerably what has already been achieved in
this area. In particular, the paper will extend our ideas on networks from the

39
The project is supported by three universities (Nottingham, Leicester and Loughborough),
Nottingham City Council, the East Midlands Regional Development Agency and bodies like
COMEDIA, EM Media and the regional Arts Council.
40
John F. Wilson & Andrew Popp (eds.), Industrial Clusters and Regional Business Networks in
England, 1750-1970 (Ashgate, 2003).
61
manufacturing to the service sectors, revealing fresh evidence of how in the creative
industries this issue has influenced both firm and sectoral development. At a time
when policy-makers are also showing considerable interest in these industries, it is
also appropriate for business historians to contribute to the debate, by providing these
longitudinal and contemporary perspectives.




Pratt (1997), who has argued that when talking about the creative industries
one can differentiate between four main phases of production:

Content origination,
Manufacturing inputs,
Reproduction, and
Exchange.


We include any direct creative activity in which individual creativity
and skill is brought to bear, and which is characterised by innovation
and originality and leads to the creation of intellectual property in the
form of copyright; such as creating a design, image or text, and acting
in the role of editor or producer.
We include any linked chains of activities which are necessary to the
exploitation of the creative input and which would not exist in the same
form without it; such as the upstream creation of the specific tools,
technologies and techniques which enable creative activity to happen,
like cameras and sound equipment, and the downstream activities
which turn a design, text or image into a marketed product, like
printing and marketing books, reproducing and presenting films.
We exclude any related economic activities which though connected
with the chains that are linked to the creative input, are not dependent
upon it, and would exist in much the same form without it; such as
property, transport, manufacture of computers and multi-purpose
technologies.

Lace Market is best described as

a creative ecology of mutually supportive interactions made up of fragile
networks of creative links and partnerships forming informal and unstructured
creative relationships between independent artists, micro-businesses and more
orthodox aspects of the cultural economy. These relationships are intermittent,
irregular, informal and not based on contractual arrangements Creative
production often happens in an unplanned, haphazard and flexible way.


7. National Corporate: firms that operate across the creative industries,
either as producers, distributors or retailers (or in more than one role).
While linked to local activities, they are managed and financed from
62
outside the region, giving them a different set of operating criteria and
management structure. Turnover: multi-million pounds.
8. National Public: bodies that are funded by the taxpayer and distribute
resources nationally and regionally. Turnover: millions
9. Regional Semi-Public: organisations that are set up mostly with
public funds to stimulate local or regional creative industries.
Turnover: up to several million pounds.
10. Local Corporate: firms that originate and are totally embedded in the
local creative industry(ies). These might be venture capital firms,
manufacturers, performers or retailers. Turnover: from 50,000 to 2-3
millions.
11. Local Independents: mostly individuals who work predominantly in
the creative industries. Turnover: up to 50,000.
12. Local Amateurs: mostly individuals who float in and out of the
creative industries on an itinerant basis, earning most of their income
from other occupations.

This is not to say that all of these categories apply to every one of the thirteen creative
industries identified by the DCMS, because in certain sectors the link between
national and local activity can be extremely vague. On the other hand, noting the
existence of such distinctions can provide a much more intimate understanding of the
extensive overlapping that occurs in many creative industries, and especially the
fleeting nature of corporate, public and personal interactions on a variety of levels and
directions.
This all-too-brief analysis of a burgeoning literature on creative industries has
provided vital insights into the principal subjects of our research. While one must
always be wary of any sectors claims to uniqueness or separate treatment, it is clear
that the creative industries possess characteristics that differ markedly with many
other parts of the economy. In particular, given what Shorthose (2002) has revealed,
not only do employment practices in the creative industries defy official classification
techniques, but also the essentially amorphous nature of creative activity leads to, and
is dependent upon, inherent flexibility and fluidity. Furthermore, the primary purpose
of creative activity is not always linked to commercial aims, complicating matters
even more. As such, the sector provides an ideal subject of research for those
interested in the dynamics of clustering and networking activities, even if any
conclusions drawn from that research would not be entirely applicable to comparative
analysis with more conventional parts of the economy.
In conclusion, though, we must stress that the highly complicated, even
unconventional, character of the creative industries must never be used by
politicians or other policy-makers as a reason for ignoring its undoubted needs. As
this report will make clear, there are many ways in which the local, regional and
national institutional structures can be diverted to assist the further development of
the creative industries, making it imperative that these bodies should listen carefully
to the practitioners and researchers who have helped compile the recommendations.

A second analytical technique employed in analysing our data relates to
further work that Wilson has conducted with Andrew Popp and Steven Toms (2003).
The essence of this work is based on the dynamic interaction of the resource
availability and resource dependency characteristics of clusters, given that as we have
just seen from our definition Having established these issues, it is now possible to go
63
on and outline the main features of the life-cycle model. The basic stages in this
model are:

Critical Mass the initial clustering of expertise and factors of production.

Take-Off - often associated with key inventions or innovations, which
alongside the clustering of expertise and factors of production give the district
a significant competitive advantage

Co-operative Competitiveness - balancing the hierarchical and heterarchical
advantages of clustering and networking and achieving competitive advantage
over rival clusters

Saturation the costs of clustering start to outweigh benefits, with rate of
growth falling away, innovation rare and competition increasing from lower-
cost producers.

Maturity rival clusters offer superior advantages for new firms and decline
sets in across the older district.

Renaissance new industries locate in the cluster, attracted by either cheap
factors of production, demand for their products or the activities of regional
planners.

When specifically focusing on the final two stages, one should remember that in many
cases clusters have failed to make that essential transition. It will consequently be
essential in this report to assess whether either of the clusters is vulnerable to
Maturity and recommend how Renaissance can be achieved.
The next stage of our work has been to identify a range of characteristics
associated with each stage. These are listed in Appendix B. While this list is by no
means definitive, it has provided the research team with a series of factors which
through detailed empirical research can be located within the life-cycle model as
applied to our case-studies. This is why our project has longitudinal and contemporary
dimensions, because we need to understand how and why the case-study clusters have
reached a particular stage of development, as well as recommend means of boosting
activity.
While it is important to stress that not all clusters pass neatly through these
stages, the advantages associated with using the model are significant. When it is
being applied directly to specific examples, five key steps can be followed:

7. Identify Stage Characteristics through empirical observation of longitudinal
and contemporary perspectives
8. Conduct a quantitative and qualitative analysis of evidence
9. Assess counterfactual and actual developments
10. Identify both positive and negative characteristics
11. Consider the key issues of sustainability and rejuvenation
12. Advise on the allocation of resources

For example, in examining cluster development generally we can identify the
characteristics listed in Appendix B and check our accumulated empirical material
64
against those lists and assess which particular characteristics are either missing or
exist in abundance. This exercise will then feed directly into the planning process,
because through counterfactual and empirical analysis it will be possible to suggest
how scarce resources can best be spent or allocated. This provides the exercise with
predictive qualities that have a general utility. In addition, we shall be able to develop
accurate longitudinal and contemporary assessments of how specific creative clusters
have evolved in Nottingham.
of this organisational phenomenon firms interact extensively with each other in order
to secure the available external economies of scale. Another dimension is governance,
in that only by introducing appropriate guidelines and notions of accountability can a
creative balance between co-operation and competition be achieved. This governance
does not need to take a contractual form; as long as the group recognises the
acceptable norms of behaviour, a balance can be effected. In this context, trust plays a
pivotal role in cementing the cluster and network together, while what we referred to
earlier as the key change agents cementing the links across the cluster and driving the
actions of other actors towards common aims. Governance structures consequently
exist (and overlap) at the level of the firm and the cluster, whilst resource bases and
dependency at the level of the firm must be situated in relation to resource distribution
and dependency at the level of the cluster.
The essence of this approach is condensed in Figure 1, the dependent variables
of which are the cluster characteristics. These include components such as
institutional arrangements, market micro-structure, characteristics of entrepreneurs,
labour relations, competitive advantage, internal accounting arrangements, and so on.
In quadrant 1, where each firm in the cluster commands an individually narrow
resource base, but dependency on external resources is high, the cluster members
must identify an appropriate conduit by which the resources are to be secured. The
likely effect is to empower the section of the cluster, perhaps a particular firm, which
is delegated responsibility for securing these resources. This may create moral hazard
and adverse selection problems within the network, where a single firm acts as agent
for the remaining firms, in addition to the principal-agent relationship between the
delegated firm and the resource provider. Accounting and accountability structures
must therefore be created which operate in two important directions. These problems
might be solved by internalising the relationships, for example, where one firm takes
over the other members of the cluster. In this situation, central management attempts
to solve the moral hazard problem by resort to internal planning and management
accounting controls that might be characterised by M-form structures. In this model,
the principal responsibility of the corporate centre is raising resources and possibly
personnel functions, and distributing them as rationally as possible to the product
divisions.
The principal advantages associated with applying this model to our creative
clusters are the opportunities it provides to clarify both the level of resource
dependence and the existing corporate governance system. This is especially useful in
the creative industries, where as we noted in the last section the ecology is so transient
and unconventional. Above all, alongside the life-cycle model, this technique will
provide policy-makers with a dynamic insight into the clusters needs, whether in the
form of resources or governance structures. It is vital to emphasise that there is no
determinism in this model; quadrants [1] to [4] exist as choices for firms over time,
dependent upon circumstances. In placing the Music or Digital Media clusters in one
of these quadrants, we can consequently help to identify the degree to which external
resources need to be secured or whether the governance structures need to be adapted.
65

Resource dependency
High Low
Internal Hierarchical,
centralised [1]
Hierarchical,
decentralised [2]
Resource base
External Heterarchical,
centralised [3]
Heterarchical,
decentralised [4]

Figure 1 Resources, governance and industry characteristics
It remains a moot point whether the key change-agents in the creative
industries would ever consider moving their locus of activity from urban centres to
less cluttered environments. Certainly, institutions like the Lace Market retain their
vitality and centrality to the lives of creative entrepreneurs and participants. In an
industry where it is essential to capture as much information as possible on recent and
associated developments, especially given an almost universal lack of the resources
required to conduct extensive research programmes, geographical proximity is of
paramount importance, obliging firms and individuals to locate close to facilitating
institutions. This makes it all the more important for local and regional authorities
to continue to invest in these institutions as an essential means of overcoming
resource shortages across the vast majority of enterprises and individuals that
populate the creative industries.
66
Appendix A:
Creative Industries Clustering Project Questionnaire

1. How old is your company?
2. How did it develop?
3. What is the approximate turnover of the business?
4. What are the key features of the business?
5. Do you have competitors in this region? How many approximately?
6. What is the role of people in this company?
7. Do you offer training, or do you rely on attracting young professionals into the
business?
8. Do you employ local people in you business? Do you find that they are
appropriately skilled and trained to participate in your business?
9. Would the employment of more professionals extend the scope and profitability of
the company?
10. Do you feel that there is adequate support from Government Bodies, City and
County Councils, and local development agencies?
11. How would you describe your relationship with your bank?
12. How could the level and type of support you receive be improved?
13. Can you recognise any specific changes or trends in your industry for the future?
14. How do you think the business should respond to these changes?
15. Who else should I talk to in related businesses?
67
Appendix B: Stage Characteristics.


Critical Mass (the initial clustering of expertise and factors of production)

- Entrepreneurial Vision
- Personally-conducive environment (climate; facilities; lifestyle)
- Locally available factors of production (land; labour; capital)
- Support industries
- Market links
- Opportunities for the personal transmission of TACIT knowledge



Take-Off (often associated with key inventions or innovations, which
alongside the clustering of expertise and factors of production give the district
a significant competitive advantage)

- Major innovation (whether in terms of expertise, product, process or delivery
mechanism)
- Key change-agents establish control over the cluster
- Political institutions increase range of activities
- Attract new entrants (in core and related sectors)
- Rapid rates of growth (output; employment; productivity; investment)
- Wider range of support industries
- Positive feedback mechanism across new and old firms
- Infrastructure improvements (transport; education & training; local services)
- Marketing, sales and distribution facilities extended
- Networking systems expand (through both formal and informal channels)
- Extended agglomeration externalities


Co-operative Competitiveness (balancing hierarchical and heterarchical
advantages of clustering and networking and achieving competitive
advantage)

- Rapid growth (employment; output; investment; productivity)
- Change-agents entrepreneurial, dynamic and embedded in local networks
- Political-economic balance of interests
- New entrants in core and related sectors
- Further investment in infrastructure
- Extend marketing and distribution networks nationally and internationally
- Market Dominance





68


Saturation the costs of clustering start to outweigh benefits, with rate of
growth falling away, innovation rare and competition increasing from lower-
cost producers.

- Costs of factors of production rise higher than alternative locations
- Law of diminishing returns (congestion effects) agglomeration diseconomies
- New entrants locate elsewhere
- Change-agents diminish in significance (economically, socially, politically)
- Transfer of nexus of power out of the region (economically, socially,
politically)
- Growth rates taper off (output; employment; productivity; investment)
- Infrastructure deteriorates
- Competition from rival clusters intensifies
- Rate of innovation dwindles
- Collaboration shades into defensive activity (cartelisation and price-fixing)
- Institutional sclerosis in local networks


Maturity (rival clusters offer superior advantages for new firms and decline
sets in across the older district)

- Closures, redundancies and downsizing
- Rival clusters grow dynamically
- Rival clusters eat into market share
- Change agents atrophy
- Political apathy
- Local networks disappear
- Disintegration of infrastructure



Renaissance (new industries locate in the cluster, attracted by either cheap
factors of production, demand for their products or the activities of regional
planners)

- Diversification
- Change-agents adopt more proactive strategies
- Closer harmony of economic and political interests
- Price mechanism attracts new entrants (cheaper land/labour/capital)
- Technological and market-based convergence
- Regional Planning
- Revival of local networks and institutions
- Infrastructure innovations (especially in education and training)
- Attract new entrants
- Growth-rates (output; employment; productivity; investment) more positive
- Related sectors expand
69
Appendix C: Digital Media Participants

NAME COMPANY
Post codes
Steve Crofts Glowmedia Ltd. NG1 3DN
Steve Mapp Broadway Centre NG1 3AL
Janet Gilbert New College Nottingham NG5 1AL
Danny Maragh Nortonprint NG1 3FT
Sue Thomas trAce Online Writing Centre NG11 8NS
Howard Oates RedDotInteractive NG1 3LG
Iain Simens Suppose Ltd. NG3 2NB
Ian Lockwood Metafocus Ltd. NG1 1PS
Ian Tatham Twelve:ten NG1 1LG
Bhavesh Jani NAAC Asian Arts NG1 6AF
John Richards Workshop Design Co. NG1 1PF
Bruce Waite Bruce Waite Design NG3 6AF
Sean Durkan Diversity Marketing Solutions NG5 6LF
Dave White Netvirtua.net NG2 3DF
Mark Winters Broadband Communications NG1 1HF
Celia Clayton Topline Design NG6 8SF
David Ellis Absolute Design Associates Ltd. NG2 7PZ
Dan Moore Output NG1 1PS
Sam Underwood Elektonika NG7 1DL
Jonathan Casciani Casciani Evans NG1 3AJ
Jennifer Mitton Agenzia NG1 3AL
Jeanie Finlay Ruby Digital Arts and Design NG1 3AL
Michael Slack Purple Circle Design Ltd. NG1 3LT
Nick Roper Headland_Multimedia NG7 2RF
Charlie Ulyatt Chant 4 Web Design NG5 2BW
Robert Wragg Robert Wragg Web Solutions NG13 8NN
Mark Winters Broadband Communications NG1 1HF
David Shutter Presence Ltd. NG7 2QJ
Andrew Ogden Broadcast Media NG7 2DU
Ian Sterling Vantage Point NG7 6JL
David Wilson PDG Graphics NG9 2RS
Simon Wallet Hot Knife NG7 6JL
Rod Heath Finishing post NG16 2GN
Lesley Roberts Afro-Caribbean Festival NG7 7OW
Paul Brook Freestyle Advertising Marketing NG5 1AP
Paul Milazzo Ryder Technology Solutions NG7 6PW
James Daly De Facto NG1 1LL
Ric Martin Penn Advertising Design Multimedia Ltd. NG2 7QX
Paul Barton Darkwaterdesign Ltd. NG1 6BB
Paul Nix PanSoft Studios NG3 3WF
Rob Lees Internova UK Ltd. NG1 1GE

70
Appendix D: Music Businesses Interviewed

Academy of Sound, Hockley. Tel. 9581888
Albion Recordng, St. Anns Hill Rd. Tel. 9103993
Arts & Events Dept., Nottingham City Council, Tel. 9158600
Bandwagon Studios, Mansfield but many city/county links, Tel. 01636813606
Beaufort Wind Quintet/Teaching/Splinters, Tel: On request
Clare, Anthony (pianist/teacher) Tel. 9255214
Classical CD, High Pavement, Tel. 9483832
Classical Music Shop, 70, Long Row, Tel. 9570011
Clements Pianos Ltd., Lenton Boulevard, NG7. Tel. 9701106
Confetti Studios, 6-10 Convent St. Tel. 9522075
Coulthard, Emma (flautist & teacher) Tel. 9106377
Deftrecordings, Tel. 07990 830473
Elderfield, Guy (Sound engineer & record producer) Tel. 07973 772420
English Pro-Musica Ltd. Contact Tony Morgan, Tel. Number available on request.
Footprint Studios, Peveril St. Tel. 9118880
Foxs Music, Victoria Centre. Tel. 9474221
Fred Parnell School of Music, Derby Road. Tel. 9473251
Fusion Management, Unit 9, Fashion Centre. Tel. 955-5078
Graffiti Studios, Tel. 8418209
Harries, Bev, 218 Rutland Rd. bev@ticktockevents.co.uk
Hobgoblin Music, 58 Derby Road. Tel. 9111883
Jean Guest Arts. jean.guest@ntlworld.com
Lakeside Arts Centre, University Park, Tel. 951-3654/951-3959
Lector Studiosus, Tel: 969-6494/969-6277
Leisure Services, Nottingham County Council, Tel. 9774206
McCartney, Mike, (music publisher/typesetter) Tel. 9106377
M-Corporation, 389-94 Alfred. St. North. Tel. 9474070
Millenium Software. Tel. 9552200
Modern Singing, Carlton Road. Tel. 8400760
Music Inn, Tel. 9470754
Music Room, Mansfield Road. Tel. 9476911
Network Studios, 22a Forest Road West. Tel. 01159784714
Nottingham City Music Library. Tel. 9152828
Nottingham Drum Centre, 22 Southwell Road. Tel. 8414148
Nottingham Festival Opera, Tel. 9382323
Nottingham Light & Sound, Mansfield Road. Tel. 9414331
Nottingham Symphony/Youth Orchestra, Tel. 9231373
Psyrex Recording & Rehearsal Studio, Hucknall Rd. Tel. 8413184
Realsound (Recording Studios) Tel. 9787745
Realsound Location Services, 4a Barrack Lane, 9411185
Recording Studio, 6 Milner Rd. Tel. 9106846
Royal Centre, Theatre Square, Tel. 9895531
Rubber Biscuit, Alfred St. Tel. 9242088
Sackmann, Dr. N., Univ. of Nottingham, Dept. of Music, Tel. 9514759
Seismik Design, Unit 9, Fashion Centre. Tel. 9555078
Sirkus Studios, 177 Wollaton St. Tel. 9100181
Soundtrack/Square Studios, Alfred Street. Tel. 9411519
Subway Studios, The Basement, Forest Mills. Tel. 9782002
71
Thumb Music (Recording studios), OPM House, Tel. 9858444
Toot-Sweet, 58 Derby Road. Tel. 9598321
Turner Violins, Lily Grove, Beeston. Tel. 9430333
Viva (Orchestra). www.vivaorch.co.uk
Voodoo Sound, Castle Studios, Tel. 07768-063-899
Windblowers Music Store. Tel. 9414433