From the listing of Bubble Mart, the 'first stock of Chinese trend culture,' which sparked further attention from the capital market towards the field of trend culture and cultural intellectual property rights, to the success of Bing Dwen Dwen, the mascot for the 2022 Beijing Winter Olympics, which became an internet sensation and led to a 'rare item' frenzy, cultural intellectual property rights have increasingly entered the mainstream public eye in recent years, especially in the investment and consumption sectors.
Against the backdrop of a favorable macro economy and a further manifestation of consumer upgrading, it is expected that the role played by cultural intellectual property rights in the spiritual and material lives of the public will become even more important in the future. This article will focus on the cultural intellectual property industry, analyzing the downstream application areas of cultural intellectual property rights, market size, driving factors, and development trends in the transaction field.
Concept and Characteristics of Cultural Intellectual Property Rights
Intellectual property rights, in a legal sense, refer to 'a collective term for rights arising from creative achievements and industrial and commercial marks according to the law.' The three main types of intellectual property rights are copyright, patent rights, and trademark rights, among which patent rights and trademark rights are collectively referred to as industrial property rights. IP is the abbreviation for intellectual property rights, also translated as intellectual achievement rights or intellectual property rights.
In a commercial sense, the common concept is cultural intellectual property rights, which refer to the connection and integration between culture and products, that is, cultural symbols with high recognizability, traffic of their own, strong monetization capabilities, and long monetization cycles. Such cultural symbols are called cultural IPs.Popularly speaking, cultural intellectual property rights include the copyright and trademark rights of literary and entertainment creation works. Cultural IP copyright resources mainly come from literature, film and television, games, animation, music, performances, sports, museums, art galleries, intangible cultural heritage, celebrities, commercial brands, university brands, etc.
Cultural intellectual property rights mainly possess characteristics such as multi-formality, symbolization, self-propagation, and time sedimentation.
Multi-formalityRefers to the fact that cultural IPs generally have two or more media forms. Usually, after accumulating a certain number of fans in their original form, they expand into other forms to achieve mutual coordination among multiple forms or have the potential to expand into other media forms. Generally speaking, IPs with more media forms often have greater value and influence.
SymbolizationRefers to the fact that excellent IPs generally have a high degree of recognizability, leaving a deep impression on the audience with personalized and differentiated images or worldviews. For example, Hello Kitty has become deeply rooted in people's hearts with its cute mouthless cat image, and Harry Potter has gained a group of highly loyal fans with its imaginative 'magic world' universe.
Self-propagationRefers to the fact that high-quality IPs are likely to resonate with users, forming spontaneous sharing and dissemination. User groups formed through interest social networking connect with each other, making fan relationships more stable. For example, users of Bubble Mart spontaneously share content such as blind box exchanges, box lottery strategies, and box unpacking displays on platforms like Douyin, Rednote, and the Bubble Mart's own trend culture community Paoqu. The strong social attribute has made lottery blind boxes a trendy lifestyle today.
Time sedimentationRefers to the continuous sedimentation of IP value with the successive launch of different forms. Good IPs can withstand time tests, transcend time cycles with universal value, and maintain a long lifespan.
Industrial Chain Layout of Cultural Intellectual Property Rights
The upstream of the cultural intellectual property industry's industrial chain is the source of IP creation. Currently, the participants in the upstream industrial chain mainly include literary creators, animation creators, and game creators.For the upstream industrial chain of Chinese cultural IPs, according to the data in the 'Xinhua Cultural Industry IP Index Report 2021', among the 50 most valuable original IPs in China in 2021, online literary original IPs accounted for the highest proportion, reaching 40%, followed by original comic IPs, accounting for about 20%.
Games across the user base have unique advantages in terms of IP value, thanks to their high user participation, long-term interaction, and emotional accumulation, enabling leading game IPs to exert their unique value. In addition, for game IPs, stronger narrative ability and cultural carrying capacity are also important factors for their inclusion on the list. Multiple listed IPs have derivative forms in literature, film and television, games, animation, etc. Such IPs generally rely on the empowerment of large enterprises such as Tencent and Alibaba, and enterprises with integration capabilities and thinking have significant advantages in IP creation.
In the midstream of the cultural intellectual property industry's industrial chain, there are mainly a series of visual adaptation content providers such as animation, film and television, and games.They usually rely on a certain fan base accumulated through the original IP form upstream and adapt content through means such as sound effects, visual effects, and interactivity to amplify the influence of IPs, mainly including various forms such as TV dramas, animations, audio, and games.
Among them, in the midstream of China's intellectual property industry chain, IP film and television adaptation has become the mainstream trend of the industry. Based on the characteristics of traditional literary forms without specific images, large adaptation space, and sufficient content resource reserves, it is suitable to adapt them into film and television works with strong content explosion power, obvious industrial linkage effects, and great audience dissemination influence to further attract traffic and amplify the voice.
The downstream monetization link of the cultural intellectual property industry chain mainly realizes IP monetization through diversified consumption scenarios such as games, derivatives, e-commerce, offline performances, and offline exhibitions.In particular, offline performances, offline exhibitions, and immersive experiences brought by games are the main monetization links in the pan-entertainment industry chain. The main participants in the downstream industrial chain are various game players, performance audiences, derivative consumers, etc.
Development of the Chinese Cultural Intellectual Property Rights Trading Market
Trading is one of the important links in the development of the cultural intellectual property industry.Cultural intellectual property trading refers to the process where IP developers innovate the design of IP content to make it a product with higher added value, and provide IP resources to demanders through market trading.The IP copyright trading platform helps copyright holders commercialize their IPs, providing services such as investment monetization and transaction management, and providing services such as finding/matching copyrights and upgrading IP products for copyright buyers.
In terms of retail sales of cultural intellectual property rights, the retail scale of Chinese cultural intellectual property rights authorized goods reached nearly 85 billion yuan in 2021. The compound annual growth rate from 2017 to 2021 exceeded 8%. In the future, with the establishment of authorized trading platforms and mechanisms in the IP copyright field, IP copyright trading activities will become more frequent, and the commercial value of IP copyright authorization will continue to be developed. By 2026, the retail scale of Chinese IP intellectual property rights authorized goods is expected to reach nearly 150 billion yuan, and during the forecast period from 2022 to 2026, it is expected to maintain a high growth rate of nearly 13% with a compound annual growth rate.
Currently, the driving factors promoting the development of the IP copyright trading field mainly include the improvement of public consumption capacity and cultural needs, the rapid development of the pan-entertainment culture industry, the promotion of business development by digital technology, and the continuous development of the commercial value of IPs.
Among them, the improvement of residents' consumption capacity and spiritual and cultural needs is the main and fundamental factor driving the development of the IP copyright trading industry.Benefiting from the rapid development of the Chinese economy and the continuous growth of disposable income in Chinese residents, the consumption capacity and demand for cultural entertainment of Chinese residents have also been continuously increasing, and the demand for cultural entertainment consumption is growing larger.
Benefiting from the development of China's macro economy, the per capita disposable income in China increased from 26,000 yuan in 2017 to 35,000 yuan in 2021. During the period from 2021 to 2022, the compound growth rate was 7.8%. According to Maslow's hierarchy of needs theory, after the public meets their most basic living needs, they will turn their attention to spiritual needs. Cultural entertainment products and services can bring the public wonderful life imaginations and self-expression channels. The consumption concept of residents is gradually changing.Against this background, it is expected that China's per capita disposable income will grow to exceed 52,000 yuan in 2026, maintaining a compound annual growth rate of 7.7% from 2022 to 2026.
The per capita cultural and entertainment consumption expenditure of Chinese residents increased from 1,260 yuan in 2017 to 1,571.7 yuan in 2021, and it is expected to reach 2,882.1 yuan in 2026. During the forecast period from 2022 to 2026, the annual compound growth rate is expected to exceed 10%.The growth of per capita disposable income and the continuous increase in expenditure on cultural entertainment provide a strong demand foundation for the development of the IP pan-entertainment industry.
Among many driving factors, the importance of digital technology upgrades in promoting the expansion of IP trading scale cannot be ignored.
On the one hand, the application of digitalization and big data in the process of IP copyright trading is conducive to improving business processing efficiency. Traditional copyright trading business processes rely on a large amount of manpower to process processes and documents, while the application of digitalization can improve business processing efficiency. The whole process of IP copyright trading can be automated on an automation platform from content production to rights confirmation, to precise marketing and IP matching based on user big data, and then to all related financial, legal, financial functions, etc., greatly improving business processing efficiency.
IP copyright trading platform experts said that blockchain technology opens the business ceiling. Traditional manual review methods cannot maintain under large business volumes, while blockchain technology makes it possible to tokenize digital copyright authentication and reduce complex work. Blockchain technology provides efficient, secure, and convenient guarantees for the registration, accounting, management, and trading of IP copyright assets through distributed ledger recording, smart contract transactions, digital encryption, etc.
On the other hand, there are numerous IP resources in the market. Before choosing an IP for commercial development, it is necessary to analyze user consumption behavior data, then match hotspots, highly recognizable, and interesting IPs, and use precise user data for big data decisions including investment, creation, commercialization, marketing, etc., which will greatly improve the effectiveness of investment operation.
Development Trends of the Chinese Cultural Intellectual Property Industry
In terms of trading forms, the transformation of IP copyrights into financial targets for sale will become a major trading trend, and the product forms vary according to the copyright content.IP securitization, in a broad sense, transforms intellectual property into transferable asset vouchers that can be sold and circulated. Against the background of the development of Internet technology and the iterative update of mobile terminals, IP copyrights, as a virtualized digital property right, are gradually being endowed with high value for sustainable development.
From the perspective of trading technology, in the future, Chinese IP copyright trading methods will experience disruptive technological upgrades, mainly relying on public blockchain confirmation technology to achieve safe and effective mass trading.Combined with the trend of IP securitization, blockchain is an essential technical element for the financial transformation of IP copyrights.
From the perspective of the division of labor in the trading field, future trading platforms will pay more attention to expanding and extending in their professional fields.The increase in the frequency and breadth of copyright trading will drive industry participants to demand more specialization and standardization of trading. Professional trading platforms can not only better match the needs of investors and licensors but also derive supporting services in finance, law, etc. according to the characteristics of cultural assets.
Therefore, in summary, driven by factors such as the improvement of public consumption capacity and cultural needs, the rapid development of the pan-entertainment culture industry, the promotion of business development by digital technology, and the continuous development of the commercial value of IPs, it is expected that the trading scale of the Chinese cultural intellectual property industry will continue to expand in the future and maintain a relatively high growth rate in the next five years.
In the future, the Chinese cultural property rights trading industry is expected to show development trends such as innovative trading forms, technological upgrades, and specialization in the division of labor in the trading field. The international influence of Chinese cultural intellectual property rights is also expected to continue to increase.
