The Indian media and entertainment sector is seemingly on an upward trajectory. According to a FICCI-EY Report published today, the sector grew by 10% from Rs 348 billion to reach Rs 2.1 trillion, in comparison to 2019. While print media witnessed a resurgence, television maintained its position as the largest segment in media and entertainment with digital media following in second place, the report stated. However, despite the growth in online gaming numbers, it lagged behind the filmed entertainment segment as the number of movie releases increased two-fold.
According to the report, the growth of digital media has resulted in the fall of traditional media shares. Digital media grew by 11% from 16% in 2019 to 27% in 2022. However, traditional media (television, print, filmed entertainment, OOH, music, and radio) shares stood at 58% in 2022, a drop of 13% from 71% in 2019.
Adding further, the report stated that despite the drop in traditional media, it still contributed to half the growth while the other half was balanced by digital, online gaming, and VFX segments.
“Television advertising grew by 2% to end 2022 just behind 2019 levels, on the back of volume growth. Subscription revenue continued to fall for the third year in a row, experiencing a 4% de-growth due to a reduction of five million pay-TV homes and stagnant consumer-end average revenue per user (ARPU),”the report added.
The report further stated digital advertising grew by 30% to reach Rs. 499 billion. The segment witnessed 48% growth in total advertising revenues. Advertising by SME and long-tail advertisers as well as advertising earned by e-commerce platforms amounted to Rs 180 billion and Rs. 70 billion respectively.
Print media advertising revenue grew by 13% in 2022. The revenue driven by subscription models grew by 5% on the back of rising cover prices. It has stabilized at 15%-20% below the pre-COVID levels.
Moreover, online gaming has come to the forefront of media and entertainment as the segment grew by 34% in 2022 to reach Rs. 135 billion. Real-money gaming accounted for 77% of segment revenues. With more than 400 million online gamers of which 90-100 million play frequently, the online gaming segment is on the rise.
In terms of advertising, digital media has contributed the highest share of advertising in India accounting for 48% from 32% pre-pandemic. The ad revenues dropped to 30% from 36% in 2019.
As per the report, private equity and venture capital funds led 77% of media and entertainment deals in 2022, contributing to 57% of the total funding. Digital and gaming aggregated 65% of deal volumes but 33% of deal value.
According to estimates, the media and entertainment sector is set to grow Rs. 734 billion to reach Rs. 2.83 trillion by 2025 at a compound annual growth rate (CAGR) of 10.5%. The contributors to the growth of the media and entertainment segment are believed to be digital, online, gaming, and television which will account for an estimated 65% followed by animation and VFX at 11%, live events, and films at 8% each.