Indian Entertainment and Media Industry in no doubt has witnessed magnificent growth in recent years. If a recent report by PWC is to be believed then India is certainly on the verge to witness major growth in E&M industry after only to China.
Indian E&M industry grew at 10.3 per cent to reach the size of Rs. 536.9 billion, although it will witness only 8 % in 2009 compared to 16.6% compounded annual growth over the 2004-08 period. The growth in Indian E&M industry would hover around 10.5 per cent during the forecasted period 2009-13.
Outlook for Segmented growth of the Indian E&M Industry industry (2009-13)
Television: The industry is estimated to grow at a rate of 11.4% cumulatively over the next five years, from an estimated Rs. 244.7 billion in 2008. The overall television industry would reach Rs. 420.0 billion by 2013. In the Television pie, television distribution is projected to garner a share of 60% in 2013. On the other hand, television advertising industry is projected to command a share of 41.0% in 2013, having increased from current 39.0% in the total ad industry pie. The relative share of the television content industry is expected to remain constant at 4%.
Film: The industry is projected to grow at a CAGR of 11.6% over the next five years, reaching to Rs. 185 billion in 2013 from the current Rs. 107 billion in 2008. The film industry would see a paradigm shift and would accrue larger revenues from new emerging avenues.
Print media: It is projected to grow by 5.6% over the period 2009-13, reaching to Rs. 213 billion in 2013 from the present Rs. 162 billion in 2008. The relative shares of newspaper publishing and magazine publishing would remain the same at around 87% in favour of newspaper publishing. Magazine publishing is expected to grow at a higher rate of 6.5% as compared with newspaper publishing which is expected to grow at 5.6% for the next 5 years.
Radio advertising: This industry is projected to grow at a CAGR of 18% over 2009-13, reaching Rs. 19 billion in 2013 from the present Rs. 8.3 billion in 2008; more than double its present size.In terms of attracting ad spend , it is projected that the radio advertising industry will be able to increase its share from 3.8% to 5.2% in the next five years.
Emerging segments: The key growth driver for the music industry over the next five years will be digital music, and its share is expected to move from 16% in 2008 to 60% in 2013. Within digital music, mobile music will continue to increase its share and maintain its dominance.
Online advertising : It is projected to grow by 32% over the next five years and reach an estimated Rs. 20 billion in 2013 from the present Rs. 5 billion in 2008. The share of the online advertising too is projected to grow from 2.3% in 2008 to 5.5% in 2013 of the overall advertising pie.
Out of home (OOH) : Advertising spend is expected to touch Rs 15 billion in 2008, which is almost twice its current size Rs 25 billion in 2013.Its share in the total ad pie is expected to go down marginally to 6.8% in 2013 from a current level of 6.9% in 2008.
Animation, gaming and VFX industry : It will continue to maintain its growth pace and is projected to grow at a CAGR of 22 per cent to Rs. 42.5 billion in 2013 from its current size of Rs. 15.6 billion.
Way Forward for Indian Entertainment & Media Industry ?
The growth in future would largely hinge on government policies along with the foreign investment into the sector. The consumer spending is also on a upsurge thus benefiting the sector in the long run.
The government relaxations on FDI limit is largely required to increase the inflow of capital into the sector. Taxes like entertainment tax also needs to be lower to encourage the industry.
What does it mean for advertising sector?
Advertising Industry owing to the economic slowdown has slowed after a period of robust growth. In 2008, overall advertising spending recorded a growth of 11.3%, over the previous year which is much lower than the growth rate of 20.7% in the earlier year. Overall spending expected to increase from the present size of Rs. 216 billion in 2008, to Rs. 366 billion in 2013.
The advertising industry fortunes are closely related to the growth of Median & Entertainment Sector in India. The lowering of projections in Media & Entertainment industry in India would certainly lower the expected growth rate for Advertising industry too.
Thus it won’t be inept to say that Indian demographics and spending surge is benefiting the modern age entertainment industry as well as attracting huge advertising spend in the country.
nice analysis but I seriously doubt the forecasted numbers by pwc.