The entertainment and media industry at $17.2 billion in 2011 is set to grow at a compounded annual growth rate of 17 % to become a $ 37.6 billion industry by 2016, according to a new study. This will be the fastest growing market among the top 15 entertainment and media markets in the world.
The study, by PwC and Confederation of Indian Industries (CII) says that advertising spend in the industry was estimated to be around Rs 279 billion, about 35 % of the total E&M revenues in 2011. Consumer spend on entertainment and media has huge potential for growth as the per capital average annual spend is estimated at $ 7 in 2011. This pales in comparison with the average per capital spend of $ 566 in the UK and $ 477 in the US, the study said.
Here are some edited excerpts. The full report has interesting trends that each segments is likely to undergo and you can read it here (pdf).
The Indian television industry in 2011 was estimated at 340 billion INR, with a year-on year increase of 15.8% from 2010 to 2011, driven equally by growth in both advertising as well as subscription revenue. Advertising revenues in television have increased by 14.3% to 116 billion INR, driven by the launch of new channels and growth in inventory. However, growth in subscription revenue has surpassed that of advertising, with a growth rate 16.5% to reach 224 billion INR, led by a sharp rise in DTH subscribers.
The Sector is expected to grow CAGR 14.7 % over next five years, to reach 674 billion INR in 2016. The growth trajectory, similar to previous years, will be equally driven by advertising and subscription revenue, both growing at a CAGR between 14 and 15%. Subscription revenue will contribute a share of over 66% of the total industry size in 2016.
Last year, the Indian print industry witnessed moderate growth. Its revenue increased from 177.7 billion INR (2010) to 190.7 billion INR in 2011.
The magazine industry saw a marginal growth in 2011. The industry has been slowing down for the past few years and the economic slowdown affected it further. Its market size is estimated to be 20.4 billion INR in 2011 as compared to 19.6 billion INR in 2010.
The Indian print industry is projected to grow at a CAGR of 9.2% over the period 2012-16 and is estimated to reach 296 billion INR in 2016 from the present 190.5 billion INR in 2011.
Wired and mobile internet access
As per the TRAI, India had around 23 million wired internet subscribers in March 2012, of which around 14 million had broadband connections. A year ago, there were around 20 million internet subscribers of which 12 million had broadband. In revenue terms, the size
of the wired internet market increased from about 45 billion INR in 2010 to almost 55 billion INR in 2011.
The Indian wired internet access market is expected to grow rapidly, again from a low base, from about 55 billion INR in 2011 to approximately 149 billion INR in 2016. India’s mobile internet access market is expected to grow even more strongly and increase multi-fold–from
about 61 billion INR in 2011 to approximately 358 billion INR in 2016, representing a CAGR of over 40%.
Wired and mobile advertising
Wired internet advertising, although smaller than its TV and print counterparts, is emerging as an important platform for reaching consumers, especially the digitally savvy. Industry revenues rose from 7.7 billion INR in 2010 to 10 billion INR in 2011, thereby demonstrating a growth rate of over 30%, almost twice the growth rate exhibited by TV and print advertising segments, albeit from a lower base.
Mobile internet advertising is presently in a fledgling state with revenues of only .1 billion Rs in 2011. The market grew by almost 100 % as compared to 2010.
The Indian mobile gaming industry was estimated at 6.8 billion INR in 2011. It is the fastest growing gaming segment with a projected CAGR of 22.2% till 2016. The gaming industry comprises the following four key segments: PC gaming, Mobile gaming, Console gaming, Online gaming.
The Indian gaming industry has shown tremendous growth in the past and its growth will continue in the future. PwC estimates that from 11.1 billion INR in 2011, the gaming industry will be worth 29.8 billion INR by 2016, surging at a CAGR of 23.6%.
Despite the slowdown in 2011 and the uncertainty about recovery, established players have held on to their advertisement rates while smaller players offered discounts for ad slots. The radio sector grew by almost 10.4 % from 12.5 billion INR in 2010 to 13.8 billion INR in 2011.
Increase in radio listenership has been the major growth driver with consumers listening to radio through new mediums like mobile phones and live internet streaming.
Radio advertising revenues in India have shown healthy growth in the past on account of the expansion of radio technology, including digital as well as internet radio. India is expected to grow cagr 16.7 % over the next five years from Rs 14 billion to Rs 30 billion in 2016.
Music industry revenues from digital platforms have grown from 4.5 billion INR in 2010 to 7 billion INR in 2011 registering a whopping growth of 60% year-on-year. The overall Indian music industry has grown to 12 billion INR in 2011 from 10 billion INR in 2010 with physical sales of music being stagnant at 3 billion INR.
The Indian music market is expected to grow from 12 billion INR in 2011 to 22 billion Rs in 2016 with cagr 12 % over the next five years. Digital spending on music is expected to increase continually and dominate industry revenues by 2016, while contribution from physical distribution will slowly decline to negligible levels.
Out of home advertising
The industry size was estimated to be 15.5 billion INR in 2011 as compared to 14.0 billion INR in 2010 and represented 5.4% of the India advertising market.
The Indian OOH advertising industry is estimated to grow at 11 % in the next five years to reach Rs 26 billion in 2016.