The way ahead for media and entertainment
- ‘The Shape of Water’ leads Oscar nominations with 13 nods
- Uber to be profitable within 3 years: CEO Dara Khosrowshahi
- WEF Davos 2018: Barclays CEO Jes Staley warns against 2006 like complacency
- Narendra Modi’s Davos speech reason of pride for Indians: Amit Shah
- PM Narendra Modi meets Canada PM Justin Trudeau at WEF Davos 2018
Last year was when digital platforms gathered momentum in the Indian media and entertainment industry. Netflix and Amazon Prime became available to local consumers while a 4G revolution led by new entrant Reliance Jio Infocomm Ltd promised to change the way in which media is consumed. Yet, the economics is still evolving, many revenue models are still nascent and demonetisation fettered revenue growth towards the end of 2016.
Growth projections: Digital to grow fastest
Over the next five years, the media and entertainment industry is expected to grow at an annual average of 14.3%, according to ‘Media for the masses: The promise unfolds’, a report by consulting firm KPMG and lobby group Federation of Indian Chambers of Commerce and Industry (Ficci).
FMCG, auto replace e-commerce firms as big advertisers
Print media, especially English-language newspapers, continue to be under pressure owing to rising consumer interest in digital content, said the report. Indeed, digital revenue is expected to grow at the fastest annual average pace of 30.8% over the next five years. In 2016, print advertising also suffered as e-commerce companies, which had taken a flurry of front page ads in the preceding couple of years, cut ad spending.
The domination of Hotstar
2016 saw not only Netflix and Amazon Prime Video, but a number of other entities firming up their presence in the OTT (over-the-top) market, such as Voot, Jio Play, and Eros Now. But as the chart below shows, Star India Pvt. Ltd’s Hotstar clearly dominates this market. Its closest competitors are a distant second by subscriber numbers and minutes spent on the platform.
Investment and types of theme parks
In entertainment, while the films segment had a lacklustre year, an emerging area is theme parks. This sector has some Rs28,500 crore in proposed investment lined up. Progress is slow and existing parks struggle to earn ticketing revenue, relying on non-ticket gains from value-added services such as food concession stands. Financing cost for theme parks continues to be high and land acquisition is arduous.