Creativity has become a key to economic competitiveness. However, the formation of creative labor, the social organization of production, and the operational mechanisms of the creative industry remain understudied. Existing studies overemphasize the role of information technology in the creative industry sector and rely on earlier analytical frameworks from the manufacturing literature. They fail to recognize creativity as an important input or the unique features of the small?large firm relationship in the creative industry.
I explore the social organization of production and interfirm networks in a digital content industry cluster, Teheran Valley in Seoul, Korea, using a case study, mixed methods approach. I argue that creative skill is a critical input that influences a firm?s production organization and interfirm relationships. I find that digital content creators in Teheran Valley rely on in-house production systems organized as semi-symbiotic project teams. This production system provides the following advantages:
1) integrating different sets of creative skills such as cultural sensitivity, technological understanding, and commercial viability; and
2) enhancing the stability and consistency of the production process, which lasts from one to two years.
Self-reliant digital content creators maintain horizontal and reciprocal relationships with large telecom corporations. Although telecom corporations are major publishers in the Korean digital content industry, they have been unable to replicate the tacit knowledge embedded in the social organization of creative work. Therefore, to develop new types of digital content products, the two parties collaborate on experimental projects that require intensive face-to-face interactions and, consequently, spatial proximity. I find that small digital content creators tend to have greater negotiating power in their relationships with large firms in the digital content industry in Korea than found elsewhere.
I employ a multi-scalar approach focusing on the interaction among different scales of governance. I argue that the Korean national government tried to mediate the supranational pressure of economic liberalization through national technological standard setting, license control, and venture sector promotion at the local industry level. These policies have shaped a more balanced power relationship between small digital content creators and large publishers in the Korean digital content industry