Digital media powered augmentation of Media and Entertainment (M&E) industry in 2018: Report

  • The growth of India’s media and entertainment industry was 13.4% to touch₹1.67 trillion in 2018
  • Digital media platforms helped in the expansion which grew 42% to₹16,900 crore in 2018

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  • New Delhi: The media and entertainment (M&E) industry of India is a first light sector for the economy and it has been growing annually 13.4 % to touch ₹1.67 trillion in 2018. According to a recent report power-driven by digital platforms that grew 42% to ₹16,900 crore during the period. The M&E sector in India is likely to cross ₹2.35 trillion ($33.6 billion) by 2021, at a compounded annual growth rate of 11.6%, as per the report was given by lobby group Federation of Indian Chambers of Commerce and Industry (Ficci) and consulting firm EY.
  • The strong phase of growth of the Indian M&E industry is supported by growing consumer demand and improving advertising revenues. It has also been increasing due to digitisation and more internet usage over the last decade. The internet has become a mainstream media for entertainment for most people.
  • Digital will carry on its sizzling pace of growth to go beyond filmed entertainment in 2019 and print by 2021, assumed the report titled A Billion Screens of Opportunity, released in Mumbai on Tuesday at Ficci Frames, a yearly media and entertainment industry event.
  • At 570 million, India is ranked as second with having the highest number of Internet users after China. The number of internet users is growing 13% annually and calculated to reach five million by 2021. The report also guesses that around 2.5 million consumers in India use digital media and would not normally use traditional media.
  • Digital ad expenditures grew 34% to ₹15,400 crore and currently comprise around 21% of the ad market. The Indian digital advertising industry is likely to grow at a Compound Annual Growth Rate (CAGR) of 32 percent to reach Rs 18,986 crore (US$ 2.93 billion) by 2020, backed by inexpensive data and increasing smartphone access.
  • Several broadcasters have started merging to sell ads across over-the-top (OTT) and linear platforms to facilitate better monetization of pergola properties and amplified deployment of digital accounts.
  • Different video-on-demand services are worried; advertising growth outpaced subscription escalation and is expected to contain 52% of the total pie by 2021. Digital subscription increased 262% to reach ₹1,400 crore in 2018, as the telecom companies (telcos) giving package content with data packs to impel sales. Likewise, video subscription revenues increased approximately three times in 2018 to achieve ₹1,340 crore (with telcos making ₹350-400 crore out of this), by the support of new and re-initiated video streaming platforms, expansion of smartphones, affordable broadband, regional language and exclusive content, and live streaming of major cricket and other impact properties.
  • Ashish Pherwani, partner and media and entertainment leader, EY India told, “The M&E sector has a significant opportunity given India’s young demographics. The growth of digital infrastructure is further enabling Indians to fulfil the need for personal content consumption, across languages and genre. There is a large shift in consumer behaviour from mass produced content to specific content defined to audience segments.”
  • Additionally, the TV industry rose from ₹66,000 crore to ₹74,000 crore in 2018, at 12% growth and is expected to reach₹95,500 crore by 2021, with advertising growth at 10% and subscription growth at 8%.
  • When TV advertising grew 14% to ₹30,500 crore, subscription grew 11% to ₹43,500 crore in past years. The television viewing households grew to 197 million which is 7.5% more over 2016 with 77% of time on television exhausted on general entertainment content and film channels.
  • The new Trai tariff order has made the viewers happier because now the viewers can choose and pay for specific channels which can have impacts on total viewership, free television uptake, channel MRP rates and ad revenues, according to the report. However, 2019 helps further growth because of the Lok Sabha elections and the ICC World Cup.
  • Print media has the second largest share of the Indian M&E sector, even though being static and rising at 0.7% to reach₹30,550 crore in 2018. It has been seen that last year there was 26% growth in digital news customers over 2017 while 222 million people read news online. Advertising revenues stand at ₹21,700 crore and subscription revenues increased slightly by 1.2% to ₹8,830 crore.
  • When newspaper advertising decreased by 1%, magazine advertising cut10%, due to reduced ad volumes and pressure on success rates.
  • Hindi newspaper publications sustained to lead with 37% of total ad volumes when the share of English publications reached at 25%.
  • The Indian film industry grew 12.2% in 2018 to reach ₹174.5 billion, compelled by the growth in digital rights and overseas theatricals. Domestic film revenues crossed ₹100 billion with net box office collections for Hindi films at ₹32.5 billion—the highest ever for Hindi theatricals. Overseas theatricals rose to₹30 billion from ₹25 billion in 2017 where China became the major international market for Indian content.

“The Indian M&E sector is entering a phase of accelerated growth. The status quo is being shattered by digital disruptions and that’s unshackling the creative economy in India like never before. These are exciting times for all it is to let our imagination and ambition guide us,” said Uday Shankar, vice president, Ficci and chair, Ficci media and entertainment division.