ENTERTAINEMENT & MEDIA SERVICES

And in my opinion, entertainment in its broadest sense has become a necessity rather than a luxury in the life ... Walt Disney

Indian Entertainment and Media Industry

The Indian entertainment and media (E&M) industry has out-performed the Indian economy and is one of the fastest growing sectors in India. The E&M industry generally tends to grow faster when the economy is expanding. The Indian economy has been growing at a fast clip over the last few years, and the income levels too have been experiencing a high growth rate. Media penetration varies across socio-economic classes

 Today, India has probably one of the most liberal investment regimes amongst the emerging economies with a conducive foreign direct investment (FDI) environment. The E&M industry has significantly benefited from this liberal regime and most segments of the E&M industry today allow foreign investment. Recently FDI was permitted in the two important sectors print media and radio. Films, television and other segments are already open to foreign investment.
The overall forecast is that the Indian entertainment and media (E&M) industry is expected to grow by 13.2 per cent, cumulatively, over the period 2011-15, to reach INR 1199 billion (Rs 1,19,900 crore). The industry in 2010 stood at INR 646.0 billion (Rs 64,600 crore) as compared to INR 580.8 billion (Rs 58,080 crore) in 2009. The Indian E&M industry grew by 11.2 per cent last year, on the back of improved economic conditions and rebound in advertising spends.

Over the next five years: The TV sector is estimated to grow at 14.5 percent cumulatively; this industry was estimated to be INR 306.5 billion (Rs 30,650 crore) in 2010. The film sector is projected to grow at a CAGR (compound annual growth rate) of 9.3 per cent; this industry was estimated to be INR 87.5 billion (Rs 8,750 crore) in 2010. The print media sector is projected to grow by 9.6 per cent; this industry was estimated to be INR 178.7 billion (Rs 17,870 crore) in 2010. The radio sector is projected to grow at a CAGR of 19.2 per cent; this industry was estimated to be INR 10.8 billion (Rs 1,080 crore) in 2010. The music sector is projected to grow at a CAGR of 17.6 per cent; this industry was estimated to be INR 9.5 billion (Rs 950 crore) in 2010. Internet advertising is projected to grow by 25.5 per cent; this industry was estimated to be INR 7.7 billion (Rs 770 crore) in 2010.

The animation, gaming and VFX industry is projected to grow at a CAGR of 21.4 per cent, this industry was estimated to be INR 31.3 billion (Rs 3,130 crore) in 2010.

 In 2010, the advertising industry registered a growth of 14.3 per cent and stood at INR 247.5 billion as compared to INR 216.5 billion in 2009. Internet advertising, with 28 per cent growth (from INR 6.0 in 2009 to INR 7.7 billion in 2010), remained the fastest growing segment as an increasing number of advertisers are using the online platform to connect with the youth. The TV industry grew by 15.4 per cent; the print industry grew by 10.7 per cent; the OOH industry grew by 12 per cent; the radio industry grew by 20 per cent; the internet industry grew by 28.3 per cent; and the animation, gaming and VFX industry grew by 31.4 per cent and the music industry grew by 25.7 per cent. The only industry that didn't grow was the film industry; in fact, it fell by 7.9 per cent, that is, from INR 95.0 billion (Rs 9,500 crore) to INR 87.5 billion (Rs 8,750 crore), in 2010.

India remains a smallish contributor to the Asia-Pacific E&M industry. Japan at USD 174 billion is by far the dominant country, accounting for 44% of the total spending in Asia Pacific in 2010 and the second largest country in the world behind the US. While advertising is growing at a rate higher than GDP growth, it is estimated that advertisement as a percentage of the GDP will remain low as compared to other developed countries like the US and Japan.

 All industry segments showed healthy growth in advertisement with print and OOH recovering well from the dip in 2009 to register a growth of 13.5% and 12% respectively. Internet advertising, with 28% growth, remained the fastest-growing segment as an increasing number of advertisers are looking to use the online platform to connect with the youth. Radio also showed a healthy growth of 20% and is fast catching up with OOH. Print advertising remained the largest segment in the advertising industry at 46% followed by television at 41%.

TELEVISION SECTOR

KEY ASPECTS IN TELEVISION SECTOR

PRINT MEDIA

KEY ASPECTS IN PRINT MEDIA

RADIO SECTOR

KEY ASPECTS IN RADIO SECTOR

MUSIC SECTOR

KEY ASPECTS IN MUSIC SECTOR

INTERNET ADVERTISING

KEY ASPECTS IN INTERNET ADVERTISING

OUT OF HOME

KEY ASPECTS IN OUT OF HOME

ANIMATION & GAMING

KEY ASPECTS IN ANIMATION & GAMING

FDI in E&M Industry

Foreign Direct Investment up to 100 percent is allowed in most of the sectors, more specifically, For Film Industry Up to 100% For Radio Industry Up to 20% For Print Media - Up to 74% publishing scientific/technical and specialty magazines/ periodicals/journals - Up to 26% publishing newspapers and periodicals dealing in news

What is the future?

Like the rest of the world, in India too, the industry will have to contend with rising demand for the digital experience. The digital experience goes beyond providing just good content and includes providing it on the device of choice as well as on demand. The industry will also have to contend with the monetisation across different platforms as well as devices, central to their existence. It is being increasingly recognised that the digital experience cannot be delivered or monetised without multi-party collaboration. As a result, there is an upsurge in collaborative partneringheralding the transformation of the E&M industry over the next five years into a digital collaborative ecosystem. What do we focus on? Industry participants, we believe should focus on the following to harness the abovementioned drivers: The empowered consumer The involved advertiser The business organisation by transforming into collaborative digital enterprise

Essentials for success

The route to success in this emerging collaborative digital environment lies in harnessing three industry-wide dynamics. Digital: There is rapid and accelerated digitisation of elements including content, business process and product innovation. Social media and apps for mobiles have had profound impact on how the consumer interacts with his/her environment and this is set to grow further. Demand: All interactions are being affected by rising consumer expectations. Consumers are empowered, connected and ready to play an increasingly collaborative role in developing new E&M products and services. Data: Data is key to the interface between consumers, content, experience and brand, as well as to innovation. Therefore, the ability to mine and analyse detailed/contextual information is key.