ECONOMIC DEVELOPMENT QUARTERLY
REGIONAL ECONOMIC
DEVELOPMENT IN
THE AGE OF DIGITAL
DISRUPTION
BY SIMON MOLLOY
The current unprecedented pace of economic
change is being driven by digital disruption,
globalisation and technological change. This
process challenges fundamental notions on which
our thinking about opportunities for economic
development are based. In a world of more
sedate evolutionary change, the past is a good
guide to the future. But in a world of rapid and
disruptive change, this much less the case.
Today, opportunities for economic development are
far less obvious and predictable than ever before.
Digital industries as a driver for regional economic
growth? If the conditions are right, why not?
In 2017 Regional Development Australia,
Northern Rivers NSW, commissioned Ki Media
and Systems Knowledge Concepts to investigate
the potential for the digital sector to act as a
growth driver in the Northern Rivers. This was
a good partnership to tackle this problem given
SKC’s capability in the economics of digital
industries and digital disruption and KI Media’s
extensive knowledge of content industries in
Australia and internationally.
The resulting report titled Digital Content
Production as a Driver of Economic Development
in The Northern Rivers was delivered in
November 2017 and is available at https://
rdanorthernrivers.org.au/digital-content-
driver-economic-development-region/
It was by no means obvious at the outset that
digital content production was a natural fit for
the Northern Rivers regional economy. Regional
economies are typically based on primary
industries and tourism with elements of service
economy activity at regional centres.
The northern Rivers, of course, has Byron Bay,
an internationally-visible culture and creativity
destination. It also incorporates Southern Cross
University, SAE Creative Media Institute, industry
facilitator Northern Rivers Screenworks and
TAFE. But, further, it has an extensive network of
relatively wealthy retirees and ‘pre-retirees’ who
are active business people and have experience
and networks in media, entertainment, finance
and who have an interesting in stimulating new,
high value, regional businesses.
The region also has a community of creative
producers who choose to live in the region for its
amenities but whose businesses are conducted
primarily out of Sydney, Brisbane and Los
Angeles.
While we were beginning our stakeholder
consultation process we also checked in
with the economic development guidelines
of the NSW Government. In its Economic
Development Strategy for NSW (2015), the
emphasis in regional economic development is
on ‘specialisation and materiality’ – concepts of
regions’ competitive advantage, in particular,
an industry’s specialisation (as measured by
the proportion of total regional employment in
that industry compared with that for NSW as a
whole) as well as the economic significance of
that industry within the region (as measured by
the employment share of that industry within the
region).
These concepts of specialisation based on
traditional industry definitions will always be
important in our thinking about economic
development but consider the following: when
Steve Jobs held the first iPhone aloft at the
Moscone Convention Centre in San Francisco,
only one technology company, Microsoft, was
in the top 10 publicly traded companies in the
world. Microsoft then made up 8.9% of the total
value of the top ten by market capitalization. In
2018 Apple was the biggest company in the world
and seven technology companies occupied the
top ten, together representing almost 78% of its
total value amounting to $US4.3 trillion dollars
of market capitalisation. That’s one decade of
economic change!
VOL.11 NO.2 2018 | 29