The Indian media and entertainment (M&E) sector grew 16.4% to reach Rs 1.61 lakh crore in 2021 as opposed to 2020, according to the latest report by FICCI-EY. Titled, ‘Tuning into consumer: Indian M&E rebounds with a customer-centric approach’ the report states that despite the recovery, M&E sector is yet to reach pre-pandemic levels and has posted 11% decline when compared 2019 due to the second wave of COVID-19 which impacted the April – June quarter. However, the M&E sector is estimated to grow 17% to Rs 1.89 lakh crore and recover its 2019 levels in 2022 and further grow at a CAGR of 11% to Rs 2.32 lakh crore by 2024.
“The M&E sector had de-grown 24% in 2020 but rebounded with a 16% growth to reach Rs 1.6 trillion (lakh crore), just 11% short of its 2019 pre-pandemic numbers. Except for cinema advertising, all segments of the M&E sector grew in 2021, though experiential segments – like events and films – are yet to get back to normal. What’s more, the sector should reach and exceed its pre-pandemic levels in 2022 itself,” Sanjay Gupta, chairman, FICCI Media and Entertainment Committee, and Jyoti Deshpande, co-chairman, FICCI Media and Entertainment Committee, said.
As for advertising revenue, advertising recovered to just 6% below 2019 levels clocking Rs 74,600 crore. Of this, while digital advertising grew to Rs 5,500 crore, the highest growth was posted by television advertising clocking Rs 6,200 crore followed by a growth of Rs 2,900 crore in print. Television, print and digital together accounted for 95% of total ad spends with television reigning the space at 42%, followed by digital and print at 33% and 20%, respectively.
According to the report, Television advertising posted a 25% growth in 2021, recording two percent decrease from 2019 levels while television subscription revenue continued to fall for the second year in a row recording a 6.2% decline due to a reduction of six million pay TV homes and a fall in consumer-end ARPUs. Interestingly, connected TV sets increased to 10 million. Furthermore, smart connected TVs will exceed 40 million by 2025, thereby ending the monopoly of broadcasters on the large screen and leading to around 30% of content consumed on large screens to be social, gaming, digital, etc.
“India has always been a different kind of media and entertainment market. High on volume and low on ARPU, yet up top with the rest on technology and ahead of the pack when it comes to digital adoption,” Ashish Pherwani, M&E Sector Leader, Ernst & Young LLP, stated.
Digital advertising grew 29% to Rs 24,600 crore in 2021 with advertising by SME and long-tail advertisers accounting for Rs 11,700 crore. Ecommerce platforms clocked Rs 5,500 crore in advertising revenue, accounting for 16% of total digital advertising. As per the report, digital subscription also grew 29% to Rs 5,600 crore with nearly 80 million paid video subscriptions across almost 40 million Indian households generating Rs 5,400 crore, an amount which is around 50% of broadcasters’ share of TV subscription revenues.
Meanwhile, print advertising revenues saw 24% rise in 2021 as ad rates remained subdued. Subscription revenues saw a growth of 12% on the back of recovery in direct to home and newsstand sales as well as rising cover prices.
The sunrise sector of online gaming recorded a rise of 28% to Rs 10,100 crore in 2021, despite people going back to work as the effects of the pandemic receded, and regulatory uncertainty. Online gamers grew 8% from 360 million in 2020 to 390 million. Real money gaming comprised over 70% of segment revenues.
As per the report, the share of regional content consumption will increase 60% of television consumption in 2025 from around 55% in 2020 and will increase to around 50% of OTT consumption from 30% in 2020. This will thereby increase the need for dubbing, titling, formatting etc. services. Hence, advertising rates of regional media will increase to get indexed to advertising rates of regional markets.
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