| Chapter 1: | Digital Media Defined |
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The growing capacity for interactivity, allowing users around the world to interact via voice over Internet protocol (VOIP) phones, instant messaging, open games, and the like provided companies with seemingly open-ended opportunities to innovate and commercialize.
Creative content has recently emerged as a key element of the new Internet reality, presenting both challenges and opportunities for East Asia. On one hand, the Internet is a foreign cultural pipeline, delivering a torrent of Western cultural material to desktops and cell phones throughout the region. But the Internet works in multiple directions, allowing equally for the sharing of East Asian material with consumers and web surfers around the world and for the creation of nation- or region-specific content. The result has been a global explosion in digitally created and digitally transmitted material, expanding the commercial, employment, and innovative base for the Internet economy. Areas of endeavor and commercial engagement once removed from serious inclusion in discussions about national innovation strategies, including entertainment, art, performance, education, and culture, have become core elements in the understanding of the twenty-first-century economy.
Digital content production has emerged as one of the fastest growth sectors of the modern economy, producing new companies, jobs, and economic opportunity at a rapid pace around the world. The digital media sector builds on different strengths and characteristics than traditional industrial activity, relying heavily on artistic and creative workers and building on cultural and entertainment industries. Digital content—much more than manufactured items—relies heavily on language and cultural understanding and often requires considerable localization to be effective. The digital media sector, as well, generates great concern about intellectual property rights and has been subject to a great deal of underground economic activity, particularly in the form of pirating and other forms of unpaid usage. Collectively, the digital content sector has produced a great deal of what economist John Whalley described as “digital swirl,” creating a vast and fast-growing economic force.25