Girish Menon, Partner and Head, Media and Entertainment, KPMG in India shares his Focus points for 2020
Profile of the digital viewer will vary across niches
As digital video consumption in India continues to rise, the profile of the user will warrant greater attention. As was outlined in KPMG in India’s media and entertainment report 2019, we will Focus on the trend that India is set to grow to a billion digital users by 2030 and each niche will represent a formidable mass of users. While the Digital Mainstream – a group that predominantly uses the mobile phone to access free content in a local language – is the most common profile of the digital consumer today, over time their increased income and confidence with technology will lead to an upward progression. It is therefore the Digital Enthusiast who will emerge as the largest group of users in the country over the next few years. This is a consumer who will embrace smartphone as well as large screen streaming of partially paid content in both local languages and English. As media and entertainment pivots to a direct to consumer model with the digital disruption, this greater heterogeneity among users will require businesses to invest in better understanding nuances of consumer behavior.
Cord cutting to gain momentum
Digital media and entertainment in India is broad-based in its appeal, as was evident from the survey undertaken by KPMG recently. Across metros, Tier I and II cities, 80 per cent of people reported that their entertainment needs were being fully met by content available online. We believe that cord cutting, the natural next step in this evolution, is therefore imminent. Already nearly 30 per cent of respondents were considering switching away completely from cable and satellite TV. English language TV channels have borne the brunt of this trend as the Digital Sophisticate shifted from conventional broadcast TV to a purely digital medium for her entertainment needs. Going forward, we expect more users to cut the cord as they become persuaded by the advantage of anywhere access alongside a rapidly expanding content library across OTT platforms.
Gaming will mature and mirror digital video growth
Over the next five years, gaming is projected to grow at a CAGR of 32 percent, making it the fastest growing segment within media and entertainment. Here as well, it is the availability of low-latency mobile internet connections and smartphones with increasingly higher processing speeds, which have led to the rapid rise in both the number of gamers as well gaming content available online. Like video streaming, the choice of device is becoming less important as people value anywhere, anytime accessibility. The thriving ecosystem already has several content creators and distributors, and discovery could soon become more of a challenge. Aggregators will emerge at the center – again not unlike OTT – and subscription models for gamers will offer curated libraries and exclusive new content to its paying audience. From casual gaming at one end to e-sports on the other, the segment is attracting plenty of attention and we expect many more mainstream media and entertainment companies in India to leverage the opportunity on offer here.