Media sector underperformed in 2011: Ficci-KPMG report

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SummarySigns of overall economic slowdown have affected the Media and Entertainment (M&E) industry too which clocked 12% growth in 2011...

Signs of overall economic slowdown have affected the Media and Entertainment (M&E) industry too which clocked 12% growth in 2011 and touched R72,800 crore, says the latest Ficci-KPMG report. However, this is 1.5% lower (R1,000 crore) than the overall outlook for the industry projected by the last year’s report of Ficci-KPMG on the M&E sector.

The print industry grew by 8.3% (instead of projected 9.5%) from R19,300 crore in 2010 to R20,900 crore in 2011. This was less than the earlier projections made by Ficci-KPMG report last year. Similarly, The over-all television industry touched R32,900 crore in 2011 growing at 10.77%, much lower than the projections of reaching R34,100 crore made in 2011 report. Even the advertising industry witnessed a two percentage point dip in 2011 clocking only R30,000 crore as opposed to the projected R30,600 crore. Overall, the advertising revenues witnessed a growth of 13% in 2011 as against 17% in 2010, the report said. “While India is still expected to grow at a healthy pace, growth is projected to be lower than earlier expectations,” the latest Ficci-KPMG report said. Detailed report is expected to be released on Wednesday in Mumbai.

However, the performance of M&E sector in 2011 outshined its own performance of 2010 by one percentage point backed by strong consumption in tier II and III cities, and riding on the continued growth of regional media and fast-increasing new media business. Overall the industry is expected to register a CAGR of 15% to reach R1,45,700 crore by 2016.

Radio is expected to display a healthy growth rate after the advent of Phase 3. Print, while witnessing a decline in growth rate, will continue to be the second largest medium in the Indian M&E industry. Also, the film industry had reason to cheer with multiple movies crossing the R100 crore mark in domestic theatrical collections and R30 crore mark in C&S rights, the report said.

Ficci secretary general Rajiv Kumar says: “Key highlights are the rise in digital content consumption, launch of diverse content delivery platforms, strong consumption in Tier II and III cities, rising footprint of the players in the regional media, rapidly increasing new media business and regulatory shifts.” Jehil Thakkar, head of Media and Entertainment, KPMG says, “The M&E industry landscape is undergoing a significant shift. Cable digitisation, the promise of wireless broadband and rising DTH penetration are all prompting strategic shifts in the way companies work.”

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