Sarah Thelwall has just completed a residency with Proboscis. In her paper Capitalising Creativity recently published by Proboscis she discusses how publicly funded, not-for-profit arts organisations might liberate themselves from their subsistence model of existence. The consequences for arts organisations of the current funding crunch for arts organisations are also discussed in the much quoted Mission Models, Money report,Towards a healthy ecology of arts and culture.

"Hundreds of not-for-profit organisations critical to both our historical and contemporary cultural canon, the creators and producers of this ‘golden age’, are over-extended and under-capitalised. Often with high fixed costs and inflexible business models many are highly dependent on annual public sector grants to survive as patterns in attendance and earned and fundraised income from the private sector change. This scenario, whilst allowing survival, offers very little scope for fundamental transformation into more responsive, adaptive, sustainable mission-led businesses delivering cultural excellence to an even wider general public. Yet this ability to evolve has never been so essential." (Mission, Models, Money, 2007)

Thelwall's main contention is that by developing a blended economy of public funding and commercial income streams, organisations (esp. artist-led orgs) might begin to develop their own, more grounded and confident, objectives according to their artistic aims and intuitions; continuing to fund experimental, developmental and responsive art practice through public funding and investing in people and infrastructure through generated income. In public funding contracts, income is linked to the amount of labour required to produce the art object or service (to ensure value-for-public-money). Usually there are some additional objectives associated with audience size and diversity. In this model the only way for an organisation to increase its income is either to become more expert and efficient at delivering outcomes or to commit to additional projects (often public funding requires that you do something new). This can lead to both burnout of key people in the organisation and a fragmentation of purpose, rather than a proper fuelling and nurturing of experimental artistic processes (what Thelwall calls First Order activities). This is the activity that generates and supports the development of powerful and inspirational vision and new "intellectual capital". By contrast, an entrepreneur would identify an existing (preferably growing) audience/customer base and provide a product or service for which there is an established demand. The suggestion is that arts organisations develop a distinct and maybe separate strand of more entrepreneurial activities that capitalise on their intellectual capital; to identify the Second Order activities in their existing practice that generate products or services that are: - packageable (and therefore do not require expert involvement at the point of distribution) - scaleable (the cost of production to your organisation remains the same if you sell one unit or thousands.) - for an existing market (market development/creation is risky and expensive). The additional benefit is that in the process of tapping your growth market, you create positive feedback and the accessibility, reach and audience for the experimental (First Order) work grows too. Second Order activities should not be confused with other more peripheral income generating ventures such as cafes and bookshops. Some examples might be the ongoing work of Sarah Staton and the Tate Homebase Multiples : slogan..."Would it look nice in the living room". But these rely on the marketing machine of the high profile Tate in order to be effective. The examples given by Thelwall include the re-creation of bespoke children's playgrounds as kits to be sold cheaper more widely and the scarily ambitious alternative approach being developed by SCAN

"SCAN - this digital media focused arts organisation is exploring an agency model. As a by-product of artists’ projects a series of commercialisable products & services have emerged. SCAN is developing these in conjunction with the artists, Higher Education institutions and commercial entities with the help of research and proof of concept funds. This distinctive approach enables SCAN to identify the rare opportunities in individual artist careers when a commercialisable outcome might both grow the audience for their work and enable the artists to benefit from a royalty stream or research strand." (Thelwall, S., 2007)

This example side-steps the, sometimes unhelpful, correlation of art with product (which it seems hard for the art to survive) and reinforces a cluster of values probably more familiar to practitioners of Networked Media Arts of dialogue, service and tooling and process. A friend pointed out wryly how delicately Thelwall's article is expressed - so as to not upset artists or to imply that they have somehow lost all of their common sense as a result of years of cosseting by public funding. All of this requires a good deal more of further constructive and practical thought- and action; around the economies of exchange for art and artistic services, especially those unique to Networked Media Arts. In earlier years I was happy as an artist to swim around in periods of creative productivity, drawing on whatever resources and opportunities came my way, buoyed by the mystique of noble poverty. Running parallel to this was another more glamourous world of the chosen-few gallery artists whose work operated in the rare commodity market. Reflecting on the Node.L Season of Media Arts 2006 taught me that there exists an unpalatable, prerequisite base-line of privilege (whether it be wealth, free-time, or education) necessary to involvement in any kind of cultural activity. Now as a member of the Furtherfield Neighbourhood the stakes seem higher than ever. There is great work done by many people, that will be lost if we don't find a way to continue in a way that is appropriate, and somehow integral to our collaborative artistic approach. It feels like an artistic challenge!