The term ‘Orange Economy’ refers to the creative economy, or that fortuitous blend of technology, intellectual property, and cultural inspiration. The colour orange in this term comes from British author and creative industry leader John Howkins and his book ‘The Creative Economy: How People Make Money From Ideas’. Orange here, comes from the book’s orange cover.
The orange economy includes an expanding array of industries primarily focused on the ideation, creation, production, and proliferation of creative goods and services. In classical terms, this refers to the ‘element X’ or technology of the growth accounting formula:
GDP Growth = Capital Growth * (Weight of Capital Contribution) + Labor Growth * (Weight of Labor Contribution) + Technological Progress
The orange economy’s industries include:
The list continues. The orange economy concerns itself not just with the arts or cultural preservation, but inspiration anywhere it can or may manifest. It focuses on the generated income, employment, and economic growth stemming from inspiration, which has interestingly found new life thanks to the Coronavirus pandemic.
Before the Coronavirus pandemic, Indonesia held the first Bali Agenda on Creative Economy from 6 to 8 November 2018. The UAE held the second in December 2021, and the third Bali hosted again in October 2022.
Further, the United Nations General Assembly declared 2021 as the ‘International Year of the Creative Economy for Sustainable Development’. In December 2019, the UN General Assembly in New York adopted resolution 74/198 by consensus. In other words, they enshrined a hallmark foundation to support the creative industries in the middle of the pandemic.
What the UN did here was change the conversation from challenge to opportunity, or to create opportunities through challenges. For example, the shares of video conferencing saint and remote working maverick Zoom rose from roughly 73 USD in early 2020 to over 500 USD later that year.
Also in 2020, the number of American ‘digital nomads’, or permanently remote workers, grew by 49% from 7.3 million in 2019 to 10.9 million in 2020. The number of traditional job holders rose from 3.2 to 6.3 million over the same period, a nearly 100% jump. Further, 90% of digital nomads reported they were either satisfied or highly satisfied with their work.
Satisfaction brings contentment, contentment growth, and growth progress. Digital nomads realise their travel aspirations, and experience overall increased well-being, leading to increased productivity. This is why many employers, post-Covid, remain to long-term ‘hybrid’ working arrangements.
The modern, sustainable, green and orange economies value the potential of digital content and digital interaction at your fingertips. Digital refers to the rapid prevalence of cloud computing-based opportunities, made possible by tech giants such as Amazon or Microsoft. And it represents the key ingredient of any orange economy product today.
There are four crucial sectors to today’s orange economy: streaming, esports, virtual reality, and digital art and content.
There existed a time when consumers had to wait for the exact hour of their favourite programme and watch it specifically during that hour. Their leisure schedule forcibly adjusted to the arbitrary time set by a television network. Streaming replaced this, to the extent that the idea of waiting for a certain hour feels horrendous and unjust.
Comical as that may seem, that is nonetheless what has transpired. During the middle of the Coronavirus pandemic in 2022, streaming surpassed cable as the most popular method of watching entertainment. Today, we have ‘streaming giants’ such as Netflix, Amazon Prime Video, Spotify, Disney+, and Twitch, each catering to specific segments of the market.
Netflix and Prime Video offer general replacements to cable. Spotify provides music, podcasts, and audiobooks. Disney+ caters to children, young adults, and all those who appreciate fantasy. Twitch brings alive a live streaming network specifically for gamers. The key wisdom here is that entertainment is now constant, whether on the move (Spotify), on the train (Netflix), or with the family (Disney+).
This increases the demand for entertainment per person, and the demand for new voices in the film, animation, musical, or literary industries. For example, the expected value of 2023’s global movie production and distribution market stands at 77 billion USD.
The video game industry continues to be a key economic driver for the orange economy. Within the umbrella term of ‘video games’ we have their development, publishing, and distribution, as well as competitive gaming–otherwise known as esports.
Esports tournaments and leagues gained immense popularity over recent years, especially through the pandemic. In other words, there are over 540 million esports viewers in 2023, on track to reach 640 million by 2025.
Again, such unprecedented demand has created video game giants such as Electronic Arts, Activision Blizzard, and Tencent. It has established competitive sports with popular titles, including StarCraft II, League of Legends, and FIFA.
Further, it has created an industry inclusive of players, coaches, managers, broadcasters, developers, producers, and more. The global esports business is projected to grow by 1.7 billion USD in 2023 to 6.7 billion USD by 2030.
Creative technology within the orange economy, such as augmented reality and virtual reality, has experienced incredible growth recently despite initial scepticism. When Facebook changed its name to Meta and announced a long-term strategy dedicated to the metaverse, its stock fell from over 300 USD to less than 100 USD in 2022.
However, that reversed in 2023 with the stock price returning to 300 USD. Why? Because it’s a new frontier, attempting to do away with television and create an all-immersive, virtual reality. The opportunities include virtual tours, VR gaming, VR apps, and mixed-reality art installations.
Meta’s company Oculus therefore competes with other major players such as HTC Vive, Sony PlayStation’s VR, and other makers of VR headsets. Yet physical headset marks only the first step, the first layer of this industry. Immersive experiences lend themselves towards immersive ‘anything,’ such as entertainment, education, training, and therapy.
The orange economy continues to evolve each year in tune with technology and creativity. Deloitte forecasts that the creative economy could grow by 40% from 2018 to 2030, and add more than eight million new jobs in nine major economies.
All things digital form the bedrock of today’s orange economy. Non-fungible tokens, or ‘NFTs’, rose to popularity as major cryptocurrencies such as Bitcoin or Ethereum entered the wallets of millions of investors. Statista forecasts at least an 18% growth rate for NFTs over the next five years, reaching a revenue exceeding 3.1 billion USD by 2027.
However, digital art is not simply NFTs. Within this umbrella, we have millions of creatives: written content, visual content, video content, and interactive content. The key word here is ‘content’. So long as a form of digital content is interesting and has value, there’s opportunity.
In greater detail, that’s articles, blogs, books, photography, graphic design, illustration, animation, podcasts, music, films, documentaries, websites, apps, video games, virtual reality tools, and so on. Each medium has its required skills and expertise.
Let’s take two examples of the creative economy. Valued at 44.7 billion USD in 2021, the digital photography market is slated to grow to 58.4 billion USD by 2030. Value at 394.6 billion USD in 2022, the global animation market is projected to grow to 528.8 billion USD by 2030.
Creation remains the central pillar of the orange, or creative, economy. If there’s an idea that can be digitally shared across the world and has value, then it should happen. This is the inherent positivity and value of the orange economy.
It is also highly complementary to the green and blue economies. The green economy serves the global effort to combat global warming and reduce emissions, including creative and sustainable designs that reduce energy usage, waste, or both. The blue economy relies on marine biodiversity and health to support a globally resurging tourism industry and a new drive to harness ‘blue carbon credits’.
Whatever the aim, so long as it is sustainable and positive to global growth, the orange economy can support it. That is its goal. The new hyper-connectedness between creative producers and corporate consumers will accelerate global growth as we move forward.
Next in this series of modern economies, we’ll cover the lesser-known ‘blue’ economy, also known as the marine economy, that has come to new prominence following the global effort to combat global warming.
The author of this text, Jean Chalopin, is a global business leader with a background encompassing banking, biotech, and entertainment. Mr. Chalopin is Chairman of Deltec International Group, www.deltec.io.
The co-author of this text, Conor Scott, CFA, has been active in the wealth management industry since 2011. Mr. Scott is a Writer for Deltec International Group, www.deltec.io.
The views, thoughts, and opinions expressed in this text are solely the views of the authors, and do not necessarily reflect those of Deltec International Group, its subsidiaries, and/or its employees. This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service, or offering. It is not a recommendation to trade.
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