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Media & Entertainment Sector in India

December, 2012

Indian Media & Entertainment Industry: Brief Introduction

Rising disposable incomes, coupled with macro-economic stability, have brought a paradigm shift in Indian consumers' lifestyles wherein they have started giving huge importance to the 'entertainment' quotient in their lives. India's media and entertainment (M&E) industry, which was pegged at Rs 80, 000 crore (US$ 14.68 billion) in 2011, is largely driven by this new trend. The Indian M&E industry is the fastest growing industry followed by China (14 per cent), Russia (12 per cent) and Brazil (11 per cent) as it is projected to grow at 17 per cent compounded annual growth rate (CAGR) between 2012 and 2016, according to the 'Indian Entertainment & Media Outlook 2012' report prepared by industry body Confederation of Indian Industry ( CII) and consulting firm PricewaterhouseCoopers (PwC).

The report identifies rising advertising and consumer spends, infrastructure and policy support, as the major game-changers for the industry. The industry growth will be further propelled by technological innovation, leading to better quality of media content being consumed wherein internet access will be the key enabler.

Market Dynamics

The advertising segment, which contributes about 35 per cent of revenue in the M&E industry in India, is dominated by television (TV) and print that constitute about 80 per cent of the pie, according to the PwC-CII study. The report further pointed out that both the segments will continue to dominate the industry over the next five years. It also estimated that the Indian M&E sector's boom is largely attributed by burgeoning internet segment, which has the potential to outshine the print sector by 2014.

Achieving the target to cross US$ 100 billion-mark will not only benefit the industry, but will also create large-scale employment, and help achieve India's goal of being a knowledge-driven economy through effective media.

Moreover, internet and gaming segments have emerged as the fastest-growing sub-segments at 57 per cent and 33 per cent CAGR, respectively. Gaming segment has been recording substantial growth owing to the rising popularity of mobile and online and social media gaming.

Television and Print Media

Television still dominates as the most effective medium for video and content consumption followed by the internet, according to Deloitte's State of the Media Democracy Survey - India 2012. TV, along with newspapers has been rated as the most influential way for advertising while almost 72 per cent of the consumers use the web on daily basis. Moreover, accessibility to social networking sites has increased tremendously as 2009 survey indicated much lower figures at 3-4 per cent as against current statistics of 45-47 per cent.


India's radio industry expanded by 15 per cent in 2011 to Rs.1, 150 crore (US$ 211.22 million) in revenue from Rs.1, 000 crore (US$ 183.67 million) in 2010, according to an M&E industry report by an industry lobby and consulting firm KPMG.

The radio broadcasting sector is projected to grow at a CAGR of 16 per cent till phase-three stations commence operations by mid-2013, pointed the report, adding that the Government is expected to earn revenues worth around Rs.1,500-1,700 crore (US$ 275.51-312.24 million) from the third auction of FM radio spectrum. The Government might hold the third auction for FM radio spectrum by March 2013.

Phase three is expected to cover 227 new cities, in addition to the current 86, while 245 FM channels are operational in 86 cities under phase two.

Online and Mobile Entertainment

TV and mobile devices are being used increasingly for watching online content, according to a latest survey by market researcher NPD DisplaySearch. The study indicates that even though consumers view online content majorly from desktop computers and laptops, mobile devices such as tablets and smart-phones, and television sets are becoming popular medium for the purpose. The study found that 18 per cent of consumers access online content on their television on daily basis.

Another survey conducted by Nielson on behalf of Google India indicated that 7 out of 10 of the buyers know the exact brand and model they want to buy with the help of online research before entering the store. This shift in consumer behaviour is attributed to easy access to information on the Internet - which has immensely boosted the concept of 'research online and shop offline'.


The Indian film fraternity will complete its century in 2013. The industry is anticipated to grow by 9 per cent per annum till 2015 to mark US$ 2.8 billion as its value, according to Deloitte.

Anticipating major cost benefits and effective synergies, PVR Cinemas has decided to acquire 69.27 per cent stake in Cinemax India for Rs 395 crore (US$ 72.55 million). PVR would become the largest movie exhibition chain in the country post this deal, as the strategic move will take its total screens to 351 across 85 locations giving the company access to eight new markets. However, Cinemax will continue to operate as a separate entity and its cinemas will not be re-branded.