This Is How The Indian Media & Entertainment Sector Will Perform In 2018 The Government is taking various initiatives that support the M&E industry's growth
By Ashesh Jani •
Opinions expressed by Entrepreneur contributors are their own.
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
The Indian Media and Entertainment (M&E) sector is expected to cross the $40 billion mark by 2021 growing at compounded annual growth rate (CAGR) in excess of 10 per cent. M&E industry has started to witness transformation with growing importance on the digital media.
Traditional media i.e., print and television will continue to grow. Cinema is has a good future as it is recognized globally and animation and VFX is becoming an integral part. Localised reach of radio is catapulting the growth of radio industry. Future of OTT is very bright and original content along with regional content will be a key driver of OTT growth.
Here are the five trends and challenges in the media and entertainment industry:
Television
o Trends
Television industry will continue to grow at a CAGR exceeding 13%. Rapid advance in technology is expected and this will further stimulate growth as high-end content transmission will follow.
o Challenges
Even though the growth of the traditional media is increasing, changes in preferences, due to urbanization, may be a factor that would hamper the growth in a long run. These include consuming "television on the go.'
o Trends
Print still has positive growth numbers even when the same are on the decline in developed economies. The growth area are more regional than national, as regional language publications, particularly newspapers, continue their slow but positive growth. Maybe the reason for newspapers to be where they are in the country is due to the reason that we Indians still love to read the newspaper with a morning cup of tea. The Indian newspaper industry will continue to grow and may cross Rs. 24k crore in 2021.
o Challenges
Print industry would certainly grow in the near term however, digital consumption of news will be a disruptor in a few years to come.
Cinema
o Trends
Film entertainment sector is expected to register a good growth, with box office revenue estimated to rise from about Rs 11k crore in 2016 to about Rs 18k crore in 2021, at a CAGR of around 10%. Content will continue to be king and drive growth in this sector. VFX and animations is slowly becoming integral part of Indian film making. A recent trend includes mid and small-budget movies getting viewership in overseas markets, particularly the middle east.
o Challenges
Online piracy of film and television content in India is rampant and investments in preventive technology need to be significant if this needs to be checked.
Radio
o Trends
Success of radio is attributed to its localized reach. Radio has witnessed increase in numbers in metros, as listeners prefer mobile and on-the-go (car radio) devices. The first lot of the Phase III license roll-out resulted in 96 channels out of 135 channels being allotted in 56 cities. Consolidation in the industry is a key trend. Expansion in Tier 2 and 3 cities, though slow will happen over the next few years.
o Challenges
Radio listeners will continue to have more choices to consume content – music, news, entertainment etc. by tuning into web radios, podcasts, audio-on-demand, etc. It is also important to note that high-end smartphones have done away with FM tuners altogether.
OTT (Over the Top)
o Trends
Original content will be a key driver of OTT growth and regional content library is expected to increase its share on OTT platform. OTT is witnessing 35% growth year on year. Currently there are about 30 OTT players in India. Many media companies have begun offering OTT video on demand (VoD). It is expected that here will be an increase in the amount of time spent on digital platforms through mobile devices. Changing tech trends in digital advertising will be the key to success for revenue models in the platform.
o Challenges
OTT faces challenges around fragmentation. The majority of Indian audiences are still stuck to the free or ad-supported model as of now. OTT heavily relies on broadband connectivity which is yet at a development stage in the country.
Regulatory updates
The Government is taking various initiatives that support the M&E industry's growth such as increase in FDI limit from 74 per cent to 100 per cent in cable and DTH satellite platforms, digitising the cable industry to get more institutional funding, and granting industry status to the film industry. Further, single window clearances are planned for approvals for outdoor events, e.g. film shooting etc. Incentive based models are being worked out to attract overseas production houses to shoot in India including ease in direct and indirect taxes.
