India's entertainment and media industry

• TV advertising and subscription will grow at an overall CAGR of over 13% during 2016-20, aided by regulation-driven addressibility, increase in C&S homes and slower than expected cannibalisation by growth in digital sector

• Contrary to global trends, India publishing industry will continue to grow, driven by expected significant increase in literacy levels, educational needs and aspiration to consume news in local languages

• Cinema revenues and admissions will continue to grow, but India will continue to remain underserved as regards access to multiplexes

• Given the low base, revenues on the digital/internet platforms will grow at a significant pace – though, unlikely to overall take over traditional sectors during the 2016-20

Mumbai, June 8, 2016: India’s entertainment and media sector is expected to grow steadily over the next four years as per PwC’s Global Entertainment & Media Outlook 2016-20. The industry is expected to exceed US$40,000mn1 by 2020 growing at compound annual growth rate (CAGR) of 10.3% between 2016 and 2020.

Key highlights of the report:

Cinema: China expected to be close to overtaking India as the biggest cinema market by 2020

In terms of admissions, India is currently the biggest cinema market in the world. It will remain so until the end of the forecast period, although China is expected to be close to overtaking it at that point. In 2015 admissions were at an estimated 2.04bn, and in 2020 are predicted to be at 2.80bn, rising at a 6.6% CAGR. Box office revenue in India stood at an estimated US$1.64bn in 2015 and will rise to US$2.74bn in 2020, at a 10.9% CAGR. There is still considerable room for expansion. In terms of multiplexes, India remains underserved. At the end of 2014, there were around 11,200 screens in the country as a whole — a small number given the population and the appetite for cinema-going. The thousands of single-screen cinemas that have traditionally dominated are beginning to disappear as a result of the multiplex boom. Multiplexes will provide better facilities — and should allow exhibitors to raise prices, within limits.

Internet Advertising: Cost-conscious advertisers embrace paid search

Paid search Internet advertising revenue is, and will continue to be, India's largest Internet advertising sub-component over the forecast period. Paid search grew 26.7% year-on-year in 2015, reaching revenue of US$211mn. With a forecast of 18.5% CAGR over the next five years, paid search Internet advertising revenue will rise to US$492mn by 2020. Online spend on display ads in India has witnessed strong growth in the historic period and revenue has almost tripled since 2011, reaching US$200mn in 2015.

TV Advertising: Digital upgrades are focused primarily on the cable and satellite sectors

Indian TV advertising revenue has consistently grown throughout the global recession and India will be one of only seven countries to achieve double-digit growth over the forecast period at an 11.7% CAGR. This will generate revenue of US$5.54bn in 2020, compared with US$3.19bn in 2015. The pace at which TV's reach has increased is seeing a shift in overall advertising budgets towards television. With no DTT (Digital Terrestrial Television) launch, TV advertising revenue is driven primarily by the subscription sector. Multichannel TV advertising revenue reached US$2.91bn in 2015 and will grow at a 12.1% CAGR to generate revenue of US$5.13bn in 2020.

Publishing: Indian publishing growth bucks global trend

Where global trends in magazine, books and newspaper publishing combined are at a near flat or negative growth trajectory, Indian publishing remains one of the fastest growing the world. Demographics, ever increasing literacy rates, educational needs, and strong desire to consume news and content in local languages, combined with nascent digital/broadband penetration, would fuel the growth and keep it relevant over the 2016-20. In 2015, the overall publishing revenues were at US$6133mn, an increase of US$302mn over 2014.

Five key shifts emerge amid the continuing disruption globally

Shift 1. Demography: Youth will be served

Our analysis of national entertainment and media markets globally reveals an almost perfect correlation between the relative size of the under-35 population and growth in entertainment and media spending—confirming that younger consumers are now the primary drivers of global growth.

Shift 2. Competition: Content is still king

In a world where Netflix can launch in 130 new countries in a single day, it’s easy to assume that content is becoming more globally homogeneous. But the reality is that content is being redefined by forces of globalisation and localisation simultaneously—and that while much of the industry is growing more global, content tastes and cultures remain steadfastly local.

Shift 3. Consumption: The joy of bundles

The ability for consumers to design and curate their own media diet has been one of the most powerful trends to emerge in the industry. But the bundle is far from dead, with video and cable incumbents—which were initially slow off the mark—now fighting back by offering their content on an integrated omnichannel basis, on TV, laptop, tablet, and smartphone.

Shift 4. Geography: Growth Markets

Generally, entertainment and media companies had one set of expectations about developed markets (slow growth, low regulation, easier to access) and another about developing markets (rapid growth, high regulation, harder to access).

Shift 5. Business models: Transforming with trust

Today’s entertainment and media market includes technology companies racing to become hybrid content companies, and traditional publishers evolving the other way to emerge as hybrid technology companies. This underlines how the growth of technology and digitisation is acting as a centripetal force—breaking up existing relationships; pushing large, generalist entities to give way to smaller specialists; and allowing smaller, nimble competitors to beat out incumbents.

About the Outlook

PwC’s 17th annual edition of the Global entertainment and media outlook 2016-2020, is a comprehensive online source of global analysis for consumer and advertising spend. With like-for-like, five-year historical and five-year forecast data and commentary across 13 industry segments in 54 countries, the Outlook makes it easy to compare and contrast consumer and advertising spend across segments and countries. Please note that all the data for India is at average 2015 exchange rates. Find out more at www.pwc.com/outlook.

Segments covered by the Outlook are TV and video, TV advertising, Internet advertising, Internet access, Radio, Out-of-home advertising, Video games, Cinema, Newspaper publishing, Magazine publishing, Business-to-business, Book publishing and Music.

Much of the content in this press release is taken from data in the Global entertainment and media outlook 2016-2020. PwC continually seeks to update the online Outlook data. Therefore, please note that the data in this press release may not be aligned with the data found online. The Global entertainment and media outlook 2016-2020 is the most up-to-date source of consumer and advertising spend data.

¹All data is at average 2015 exchange rate

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