The International Content

Services Centre (ICSC)

Contribution by Kieran O’Hea to the ICSC Draft Proposal Version 03.09.09

The 2002 Forfás report “A Strategy for the Digital Content Sector in Ireland” drew attention to the potential
global demand for digital content and framed this in the context of the development of the sector in Ireland.
Its vision was to develop a world class digital content industry based on the targeted development of a number
of clusters at the intellectual property end of market, namely enabling technology and high-value content and
applications.

The report also predicted that the future value of the Irish digital content sector depended on providing
incentives that would attract multinationals to locate content related activities in this country. These activities
included the creation and distribution of content and also fiscal measures including digital asset management,
rights trading and collecting income from royalties. Forfás believed that Ireland had a window of opportunity
of five years to do this. It is now seven years since the report was published.

Silicon Republic may have indirectly shed some light on why the report didn’t bear fruit:

"In 2002 Ireland was at a crossroads. It could have focused its energies on creating a vibrant, innovation-driven
economy led by well-funded entrepreneurs driving scalable export-oriented businesses that would generate
employment in parishes across the land. Or it could have focused on the then burgeoning construction
industry, which saw opportunities in the housing boom. We opted for the latter route, more Irish money went
into the commercial UK property market than local businesses and the rest – including €90bn of financial debt
which NAMA will have to absorb – is history. But it could have been different. It still can be different.”

www.siliconrepublic.com/news/article/13712/business/digital-21-entrepreneurship

Getting back to ICSC, encouraging the development of new intellectual property by Irish companies should be
one of its objectives. Digital content is an IP intensive business and must therefore be positioned as a sector
with high growth potential in this context. To have economic consequences however, IP needs to be protected
and leveraged on a wide scale. Ireland has traditionally been poor at doing this. We must learn to monetise
our creativity.

Digital content may not lead to many patents being registered but a large amount of trade may be based on
licensing and royalty payments. Negotiating the best deal possible can be an intimidating challenge for digital
enterprises particularly when trying to negotiate with large clients who have access to significant legal
resources.

The ICSC proposal should not be aimed solely at convincing government. Representative bodies like the Irish
Internet Association also need to be convinced. So do members of the local digital media community who do
not reside in the Digital Hub or are not members of the Digital Content Forum.

Proficiency in the creation, management and trading of digital content can contribute significantly to Ireland’s
future competitive advantage. However it needs to be decided if the ICSC is aimed at digital media companies,
traditional content companies, companies who are developing IP in Ireland, the creative industries or all of
these.
The use of analogies like NYSE and IFSC need to be thought through bearing in mind current sensitivities about
the banking sector. The IFSC will be remembered as an inducement to international banks to move to Ireland
to take advantage of tax incentives. Most moved staff here lock, stock and barrel so it is probably not
remembered for local job creation.

The ICSC needs a USP – something that differentiates Dublin as a location to locations which are more
synonymous with stock exchanges (New York, London) and bandwidth (US, Malaysia). We need to marry
financial incentives with our creative culture (“from wired to inspired”). The ICSC needs to be a haven in which
to create, protect and exploit content.

Need to learn from and differentiate from other projects such as Digital Hub, SFI, Forum Virium (Helsinki) and
Babelsberg Media City (Berlin). Prepare some case studies. An interesting educational model supporting
innovation and the smart economy is the decision to amalgamate the Helsinki University of Art & Design, the
University of Technology and the University of Economics.

As Science Foundation Ireland is endeavouring to do in attracting the world’s leading scientists to carry out
primary research in this country, ICSC can be an international centre of excellence which together with the
right infrastructure and appropriate trading incentives will provide the world’s leading content companies with
a compelling argument to base their European operations here.

Meanwhile the ICSC should also provide indigenous companies with access to comprehensive resources such
as academic support, R&D facilities, and networking and collaboration opportunities. They can also avail of
mentoring and business support as and when they need it, including legal and financial advice, as well as
introductions to international partners.

Financing the ICSC is not only about providing investment but also about providing incentives. Schemes
whereby Irish content companies would receive subsidies towards content creation, particularly in export
markets, must be considered, as should financial relief relating to the exploitation of IPR, i.e. tax-free royalties.

The wording around content distribution needs to be chosen carefully. Promoting Ireland as a single location
from which content would be distributed securely may be at odds with the practice of making content
downloadable from many locations worldwide, bundled with charging in the local currency.

Niall Jordan said at Farmleigh that Ireland was let down by the church, banks and other institutions but not the
Irish cultural industry. This could add weight to the ICSC argument. “Give creativity a chance”

The momentum generated by the ICSC proposal and by Farmleigh must not be allowed to dissipate. The ICSC
plan has been publicised by Ministers including Conor Lenihan who has been quoted as saying that the
Government will enact the plan. Talk of setting up stakeholder groups, a digital strategy unit and even a digital
strategy department must become reality.

©Kieran O’Hea