Global-Wood: Hollywood's Foreign Market Challenge in the Digital Economy
This study examines the impact of the global digital economy on cost structures in Hollywood, as an example of an information intensive, or intellectual property dependent, industry. Furthermore, it analyzes how a shift in industry cost structures due to digital technology has impacted the issue priorities of film industry trade associations and lobbyists in their efforts to set and shape the US Government's legislative and foreign trade agendas. The research aims to answer these questions: Given that digital technology exacerbates the "appropriability problem" of information intensive industries by lowering the marginal costs of content reproduction, what will be the response of Hollywood's trade association as it seeks to protect the market dominance of American film? Additionally, what factors have to come together in order for the industry's business-government relations representatives to deem the issue critical enough to merit substantive action. This thesis hypothesizes that it was the conjunction of two shifts in cost structure - the reliance on revenues from content licensing as opposed to content exhibition and a growing dependence on overseas profits - which prompted an industry response as it became necessary to consider the intellectual property protection infrastructures of foreign nations. Only then did the issue prioritization and agenda-setting strategies of the American film industry's trade associations widen in scope and breadth to accommodate the industry's new challenges in the digital economy.
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