The media and entertainment industry is now on the road to recovery after facing headwinds due to fallout of major regulatory interventions such as demonetisation, GST and RERA, resulting in lower consumption and ad spend during FY18. However, strong and consistent economic growth fueled by a rise in consumption and growth in digitisation provided support, enabling the Indian Media and Entertainment (M&E) industry to grow at 11 per cent over FY17 to reach INR1,436 billion in FY18. The long term outlook for the sector remains strong on the back of a buoyant Indian economy, robust domestic demand, particularly in rural and regional markets and growing digital access and consumption. This year, we saw Telecom-media-technology (TMT) convergence take center stage and the emergence of media ecosystems. This has the potential to significantly change how media is created, distributed and consumed and media companies need to take a relook at their strategies and business models to successfully operate and thrive in the new paradigm.
Mritunjay Kapur Head – Technology, Media and Telecom, KPMG in India commented, “Digital technology, coupled with radical shifts in consumption patterns have undeniably resulted in blurring of boundaries that define the Telecom, Media and Technology (TMT) sectors. TMT Convergence is now a reality and will likely cause significant disruptions across the value chain. Media organisations would need to re-evaluate their existing strategies and operating models to leverage the emerging opportunities and sustain against new evolving challenges”
The India media and entertainment industry was affected by lower adspend in FY18 due to Goods and Services Tax (GST) rollout and the lingering effects of demonetisation. However, this effect has been temporary and the industry is seeing positive long term outlook on the back of rapid growth in digital access and consumption, coupled with strong domestic demand especially from the rural and regional markets. The sector grew by 10.9% in FY18 to reach INR 1,436 billion and it is expected to grow at a CAGR of 13.1% over the next five years to reach INR 2,660.2 billion by FY23. Growing presence of Telecom and Technology players in media distribution has led to convergence of business models across TMT and media companies will’ have to evolve to successfully operate in the new paradigm” commented Girish Menon Partner and Head Media and Entertainment, KPMG in India.
Television: Television is expected to grow at a CAGR of 12.6 per cent on the back of growing TV penetration, strong advertising demand, growth in domestic consumption and major events supported by better distribution realisations due to operationalisation of TV digitisation
Print: Likely to see muted growth at 5.9 per cent CAGR due to sluggish growth in English newspapers and pressure from the digital platforms. This will be offset by strong growth in language newspapers
Film: The segment is expected to remain resilient with a 7.6 per cent CAGR on the back of strong demand from digital platforms and growing overseas revenues
Digital advertising:Digital adoption to spearhead strong growth in digital advertising at 30.2 per cent CAGR
Animation and VFXindustry to show strong growth of 15.5 per cent
Gaming industryexpected to touch INR 118.8 billion by 2023
OOH segment is expected to grow at a 9.2 per cent CAGR
Strong growth projections for the music industry with a CAGR of 15.5 per cent