Oleh: Sucipto, PhD
(Graduate of Central China Normal University, Wuhan, and Secretary of the Library and Information Council, Muhammadiyah Yogyakarta)
Masriadi Sambo and Jafaruddin Yusuf in their book, Introduction to Multiplatform Journalism (2017) said that network convergence is the efficient coexistence of three aspects in one network: video transmission, telephone network, and data communication. In recent years, network convergence has also developed significantly in China.
Panqiang Niu et al. have published an article in the journal Informasi entitled “The Effect of Network Convergence on the Digital Culture Industry: Economic Construction Model of the Network Industry and Empirical Studies in China“. The journal is a prestigious and has been indexed by Sinta 2 and published by Yogyakarta State University, Indonesia. The article builds an industrial economic network model based on Chinese panel data.
In Angela Markel’s view (2013), the digital culture industry is an industrial information transfer and intermediary sector. This paper considers that the digital culture industry is based on digital, multimedia, and network technologies and uses information and other resources to create, develop, distribute and consume information products and services. The digital culture industry includes digital film and television production, games, animation, interactive entertainment, three-dimensional images, digital learning, publishing, collections, shows, network services, content software, etc.
Many studies suggest that the reason is mainly related to two aspects. One aspect is the technological advancement of the digital culture industry, such as digital processing and storage. Another aspect is advanced information systems infrastructure, for example, network technology innovation and network convergence. In general, network convergence will change the industry chain and the value chain of the digital culture industry. However, there is a rare theoretical discussion about the mechanism of the effects of network convergence on the digital culture industry.
This paper seeks to apply network industry economics and institutional economics to study the mechanism of influence of network convergence on the digital culture industry. Network convergence is a technological breakthrough for the development of the digital culture industry. The effects of network convergence on the digital culture industry are complex. Panqiang Niu et al. criticize many previous studies that ignored the complex relationship between network convergence and the digital culture industry. This paper introduces the factors of policy, capital, and operating costs to explain the complex relationship. Theoretically, network convergence is significantly related to the development policy of the digital culture industry and investment in the digital culture industry. Therefore, network convergence can produce significant policy effects and capital effects.
Meanwhile, the policy effect and the capital effect of network convergence have a negative relationship with the operating costs of the digital culture industry (Preston, 2001). It means that they will reduce the operational costs of digital content companies. Finally, there is a negative correlation between the operating costs of digital content companies and their performance. The cost reduction of digital content companies can improve their performance. This is relevant with the emergence of the Covid-19 outbreak, which has reduced community interaction and activities. Further, it will increase production costs if the digital culture industry produces an event unless the event is conducted online.
Empirical studies in China and network convergence have prompted the relevant government to develop many policies for the digital culture industry. However, the empirical results show that the policy effect does not have a significant negative relationship with the operating costs of the digital culture industry and does not have a meaningful positive relationship with firm performance. Therefore, it can be considered that the policy effect does not directly reduce the cost of the digital culture industry and improve its performance. Although industrial network economics is suitable for studying the impact of network convergence, the main body of industrial network economics is still a continuation of the neoclassical economics research paradigm and takes price as a critical factor. Neoclassical economics research is based on parameters such as preferences and institutions. This hypothesis has several flaws in studying the effect of network convergence. Under the influence of network convergence, institutional change and policy regulation are important factors influencing the development of network convergence in depth. To encourage the development of network convergence, it is necessary to reform several institutions or policies (Liu, 2013). Therefore, this paper attempts to use neo-institutional economics and new institutional economics to cover the shortcomings of the network industry economic model.
The research object in the network industry economy is the infrastructure industry with a network structure, such as communication and transportation networks. Network industry economics studies incentive regulation and market competition (Shy, 2001). The government’s goal in promoting network convergence is to establish a competitive market structure for the communications industry. The communication network is the infrastructure of the digital culture industry, and consumers must consume the digital culture industry through the communication network. In terms of the network industry economy, the market structure of the communications industry before and after network convergence is different, and this difference is reflected in the price and service quality of the communications industry. At the same time, this difference will be conveyed to the digital culture industry, which will affect the price, supply, and demand of digital content products. Based on the network industry economic model built, this paper will first study the effect of network convergence on the price, supply, and demand of digital content companies in the change from one network to the intersection of three networks. According to network industry economics, this paper studies network convergence on price, supply, demand, product quality, consumer utility, etc.
In addition, the weak point is that this paper does not explain how the process in overcoming the distance between capital, human resources, and convergence specifically that occurs in the world of the digital industry. It would be better if the cases that occurred in China are presented. A state system affects regulations and systems. Meanwhile, regulations and systems are the foothold for the digital culture industry in running their business.
Digital industrial practices in China can be transferred and cloned in Indonesia. There are many popular Chinese films that are in great demand in Indonesia. Additionnaly, many Chinese movie stars are well known in Indonesia, such as Jacky Chan, Jet Li, Samo Hung, Andy Lau, etc. However, each country has a different culture, regulation, and level of technological development. Interestingly, the Panqiang Niu’s article is looking for a meeting point between the digital world and the media industry.