The Indian media and entertainment (M&E) industry is one of the fastest growing industries in the country. Its various segments—film, television, advertising, print and digital among others—have witnessed tremendous growth in the last few years.

According to a report jointly published by the Federation of Indian Chambers of Commerce and Industry (FICCI) and KPMG, the media and entertainment industry in India is likely to grow 12.5 per cent per annum over the next five years and touch US$ 20.09 billion by 2013.

With a majority of the population below the age of 35, and increasing disposable income in Indian households, the average spend on media and entertainment industry is likely to grow in India, according to a report by PricewaterhouseCooopers (PwC).

Television

According to the study by FICCI and KPMG, the television industry, which is currently valued at about US$ 4.63 billion, will expand by 14.5 per cent between 2009 and 2013. According to a PwC report, the television advertising industry is expected to account for a share of 41.0 per cent of the advertising industry in 2013, up from the present share of 39.0 per cent.

Digital distribution platforms such as direct-to-home (DTH) and Mobile TV are transforming the industry. Mobile TV—where content will stream in on mobile phones—is poised to grow big with the advent of 3G, according to experts. With the DTH industry estimated to grow by almost 100 per cent in the current financial year—from US$ 310.16 million in 2008-09 to an expected US$ 620.25 million in 2009-10—leading DTH firms such as Sun Direct, Bharti Airtel DTH and Big TV have increased their marketing budget by 20-25 per cent in fiscal year 2010.

Further, television channels such as Cartoon Network, Pogo, Disney, MTV and Star Plus are expanding their product range to tap India's growing US$ 125.9 million licensing and merchandise market.

The television distribution industry is expected to reach US$ 5.2 billion in 2013 from the estimated size of US$ 3.12 billion in 2008, which translates into a growth of 12.2 per cent on a cumulative basis over the period.

India’s national television broadcaster, Doordarshan, will be completely digitized by 2017, according to Mr Zohra Chatterji, Joint Secretary, Information and Broadcasting ministry.

Music

Industry experts estimate that the current size of the music industry is about US$ 149 million. According to a PwC study, the industry is likely to grow to become a US$ 164.56 million industry by 2012.

While cassettes and compact discs (CDs) have traditionally accounted for most of the sales, future growth will come from non-physical formats such as digital downloads and ringtones, among others. Digital music sales are expected to account for 88 per cent of the total music industry revenue in India by 2009.

According to a PwC study, the important driver for the music industry over the coming years, will be digital music, and its share is expected to move from 16 per cent in 2008 to 60 per cent in 2013. Also, within digital music, mobile music is expected to continue to increase its share and maintain dominance.

Radio

The cheapest and oldest form of entertainment, reaching 99 per cent of the population, this segment is likely to see many dynamic changes.

According to a PwC study, the radio industry is forecast to grow at a compound annual growth rate (CAGR) of 18 per cent over 2009-13, reaching US$ 391.15 million in 2013 from the present US$ 170.87 million in 2008. That's more than double its present size. In terms of its share of the advertising pie, it is projected that the radio advertising industry will be able to increase its share from 3.8 per cent to 5.2 per cent between 2009 and 2013.

The government earned US$ 11.05 million from private radio channels during 2008-09.

Advertising

The number of brands advertised on television witnessed an 82 per cent increase during 2008 compared to 1999, according to a survey by AdEx India, a division of Tam Media Research.

The television advertising industry is expected to reach US$ 3.12 billion in 2013 from the estimated size of US$ 1.75 billion in 2008, which translates into a growth of 12.2 per cent on a cumulative basis, over the period.

Going forward, digital media advertising (internet, mobile and digital signage) is expected to emerge as the medium of choice for advertisers. According to a FICCI-PwC report, online advertising is expected to touch US$ 212.03 million in 2011.

Digital advertising on newspaper web sites will increase at a 6.8 percent compound annual rate to US$ 8.3 billion in 2013 from US$ 6 billion in 2008, increasing its share of total newspaper advertising to 9.1 per cent from 5.4 per cent in 2008, as per a PwC report on the Indian media and entertainment industry.

According to a PwC report, Internet advertising is projected to expand by 32 per cent over the next five years to reach US$ 411.74 million in 2013 from US$ 102.94 million in 2008. Also, the share of online advertising is projected to grow from 2.3 per cent in 2008 to 5.5 per cent in 2013. The report estimates the size of the Out of home (OOH) advertising spend to be US$ 308.8 million in 2008. This figure is projected to almost double in 2013 to US$ 514.67 million.