Media and Entertainment
With 146 million television households in 2011, India stood as the third largest television market in the world.

Media and Entertainment Industry

Latest update: June, 2014

Advertising revenue forecast

Advertising revenue is expected to touch US$ 11.6 billion by 2017 from US$ 5.9 billion in 2012.

Advertising revenue forecast

Advertising revenue share

Print is the largest contributor, accounting for 46 per cent of the advertising share.

Advertising revenue share

Market size of entertainment industry

The entertainment industry is expected to develop at a CAGR of 15.2 per cent during 2012–17.

Market size of entertainment industry

Size of major entertainment industry segments

The television segment is expected to grow to 51 per cent by 2017.

Size of major entertainment industry segments

Updated: June, 2014

ENTERTAINMENT SECTOR REPORT | April, 2014

Brief Introduction

The Indian media and entertainment (M&E) industry is full of potential and has a tremendous impact on the country’s economy. As per a FICCI–KPMG report, India’s M&E industry reaches 161 million TV households; 94,067 newspapers; about 2000 multiplexes; and 214 million internet users, of which 130 million access the Internet on their mobile phones.

The industry grows with each passing day and plays a significant role in creating awareness on many issues that impact the masses. India’s population is over 1.2 billion. These numbers give the M&E industry in India a tremendous opportunity for growth. A few years ago, the idea of reaching and engaging the county’s population seemed improbable. That scenario has completely changed today and the current industry is armed with digital technologies, modern mobile devices, penetration of broadband internet and digital cinema, and considerable backing from the Central Government.

Market Size

India’s M&E industry registered a growth of 12 per cent in 2013 and touched Rs 91,800 crore (US$ 15.27 billion). The industry has the potential to grow at 14.2 per cent to more than Rs 1.78 trillion (US$ 29.61 billion) in the next four years, as per a report by FICCI–KPMG.

The television industry in India, which was estimated at Rs 41,720 crore (US$ 6.94 billion) in 2013, is projected to increase at a compound annual growth rate (CAGR) of 16.2 per cent over 2013–18, to reach Rs 88,500 crore (US$ 14.72 billion) by 2018.

With an estimated market size of US$ 5 billion, India is the 14th biggest advertising market globally, as per the latest edition of the Gunn Report. Digital advertising is also expected to witness a CAGR of 27.7 per cent by 2018.

Investments

The foreign direct investment (FDI) inflows in information and broadcasting (I&B) sector (including print media) during April 2000 to March 2014 stood at US$ 3,712.72 million, as per the data released by Department of Industrial Policy and Promotion (DIPP).

The following are some of the major investments and developments in the M&E sector:

Infosys has entered into collaboration with telecom company Orange to offer Internet TV to its customers. In a statement, the company said that it will create a portfolio of interactive TV apps on the Orange Livebox Play. The apps will be powered by Infosys DigitizeEdge, an integrated digital content monetisation platform. Also, Infosys will use this cloud-based platform to facilitate Orange to provide a range of lifestyle-centric video and contextual over-the-top (OTT) services through its TV apps to improve viewer experience.

Vodafone India has entered into collaboration with Disney India’s Interactive business to bring about games and applications for both smart and feature phones. “Our association with Vodafone is a step forward in our strategic relationship with them and creates an additional destination for exciting games and apps for their users,” as per Mr Sameer Ganapathy, Vice President and Head, Interactive, Disney India.

Zee Entertainment Enterprises Ltd will soon launch Zindagi, an entertainment channel featuring syndicated content from Pakistan. While the first set of content will be sourced from Pakistan, the company is also actively sourcing content from various geographies such as Turkey, Latin America, and Egypt, as per Mr Punit Goenka, MD and CEO, Zee Entertainment Enterprises Ltd.

San Francisco-based digital music services company Rdio signed an agreement to acquire Pune-based music streaming service, Dhingana, in March 2014. “India is a tremendously vibrant market for music and culture and one of the largest and most important in the world," as per Mr Anthony Bay, CEO, Rdio.

Guardian Corporation will establish a Dinosaur Park, which will be among India’s largest indoor theme parks with more than 23 attractions. “It’s been over two decades since India became a part of the global economy, but we still lack good entertainment destinations. We want to contribute in filling this gap by offering the design and development services for amusement parks, theme parks and museums,” said Mr Manish Sabade, Chairman, Guardian Corporation.

Government Initiatives

The Cabinet Committee on Economic Affairs (CCEA) has given the go-ahead for the proposal of the Ministry of I&B with regard to the 12th Five-Year Plan scheme of All India Radio (AIR) and Doordarshan ‘Broadcasting Infrastructure and Network Development’ at a cost of Rs 3,500 crore (US$ 582.34 million). The two primary components of the proposal are the continuing schemes of the 11th Five-Year Plan and new schemes of the 12th Five-Year Plan. As part of the 11th Plan scheme, the capacity of Doordarshan's Direct to Home (DTH) is being increased to 97 channels from 59 channels. During the 12th Five-Year Plan, the capacity is expected to further increase to 250 channels.

The Indian and Canadian governments signed an audio-visual co-production deal in February 2014. The deal would help producers from both India and Canada to harness their artistic, technical, creative, financial and marketing resources for co-productions and, subsequently, lead to exchange of culture and art among the two countries.

Further, the Centre has given the nod for licences to 45 new news and entertainment channels in the country. Among those who have secured the licenses include established names such as Sony, Star, Viacom and Zee. Currently, there are 350 broadcasters which cater to 780 channels. “We want more competition and we wanted to open it up for the public. So far, we have approved the licences of 45 new channels. It’s a mix of both news and non-news channels,” as per Mr Bimal Julka, Secretary, Ministry of I&B, Government of India.

Road Ahead

India’s M&E industry will continue to bank on the digital area in future. With a growing internet user base of over 200 million, the industry’s potential to generate revenue is vast. In 2013, telecom companies started focusing on data as a way to generating revenue. Also, advertising agencies competed with each other to acquire in the social media and digital domains. These developments suggest a bright future for the M&E industry in the country.

It is also time for the M&E sector to start looking at opportunities outside India. Africa and the Middle East are two of the fastest growing M&E markets, and Indian M&E companies would do well to explore these regions.

Exchange Rate Used: INR 1 = US$ 0.0166 as on June 27, 2014

References: Media Reports, Press Releases, FICCI–KPMG report, Press Information Bureau

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

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