Digital to drive M&E industry to $55-70 bn by 2030’
The Indian media and entertainment (M&E) industry is projected to experience significant growth in the coming years. According to estimates, the industry is expected to reach a $55-70 billion valuation by 2030, exhibiting a robust compound annual growth rate (CAGR) of 10-12%. This growth trajectory reflects the increasing demand for media and entertainment content in India and the industry’s evolving landscape.
The M&E sector in India encompasses various segments, including television, film, digital streaming, music, gaming, and advertising. The rise of digital platforms, increased internet penetration, and the availability of affordable smartphones have played a crucial role in driving the growth of the industry. These factors have resulted in a surge in digital content consumption, leading to the expansion of digital media and streaming platforms.
Furthermore, the growing middle class and rising disposable incomes have increased consumer spending on entertainment and leisure activities. The demand for diverse and high-quality content across different mediums has propelled the growth of the industry. Additionally, the emergence of regional content and the popularity of streaming services have further fueled the expansion of the M&E sector.
The projected growth of the Indian M&E industry presents significant opportunities for content creators, producers, distributors, and advertisers. It also generates employment opportunities and contributes to the overall economy. However, it is essential to address challenges such as piracy, copyright protection, and regulatory frameworks to ensure sustainable growth and protect stakeholders’ interests.
According to a report by the Confederation of Indian Industry (CII) and Boston Consulting Group, the growth of the Indian media and entertainment industry will be primarily driven by robust digital segments. These segments include OTT (over-the-top) streaming platforms, gaming, animation, and visual effects (VFX).
OTT streaming platforms have experienced significant growth in recent years, fueled by the increasing popularity of on-demand content consumption. The convenience and flexibility offered by OTT platforms have attracted a large user base, and the trend is expected to continue. The report suggests that expanding OTT platforms will be a crucial driver of the industry’s growth as they cater to consumers’ evolving preferences.
Gaming is another thriving segment within the M&E industry in India. The country has witnessed a surge in the number of gamers and the revenue generated by the gaming sector. Mobile gaming has gained significant traction with the increasing penetration of smartphones and the availability of high-speed internet. The report highlights the potential of the gaming segment to contribute to the industry’s growth, driven by factors such as the rise of esports and the development of immersive gaming experiences.
Animation and VFX are also identified as growth drivers in the report. The demand for animation and VFX content has increased across various industries, including films, television, advertising, and gaming. Indian studios and talent have gained recognition globally for their expertise in these areas, presenting opportunities for further growth and expansion.
The strong performance and potential of these digital segments align with changing consumer preferences and technological advancements. As digital platforms and technologies evolve, they offer new content creation, distribution, and monetization avenues.As of 2021, the composition of the Indian M&E industry can be categorized as follows based on their respective shares: television (33-35%), print (22-25%), gaming (9-10%), OTT (7-9%), search and social platforms (7-9%), audio (5-7%), cinema (5-7%), animation, VFX, and post-production facilities (2-4%), and out-of-home and other segments (1%).
While television remains the largest segment in terms of market share, digital platforms are experiencing rapid growth, outpacing other segments. This growth has been largely influenced by the COVID-19 pandemic, which has led to an increased reliance on digital platforms for entertainment and information.
The report indicates that the number of hours spent per day per user on digital and video platforms has risen from 1.8 hours in 2018 to 2.9-3.2 hours in 2021. Similarly, for television, the average time spent per day per user has increased from 3.6 hours to 4.3-4.5 hours. These statistics reflect the changing consumer behaviour and the shift towards digital consumption.
The surge in digital usage can be attributed to several factors, including the availability of affordable smartphones, widespread internet access, and the growing content offerings on digital platforms. The convenience, variety, and personalized nature of digital content have contributed to its popularity among users.
While television continues to hold a significant market share, the growth of digital platforms, including OTT streaming, gaming, and social media, is reshaping the M&E industry. This trend is likely to continue as digital platforms offer greater flexibility, on-demand content, and interactive experiences that cater to the evolving preferences of consumers.
The subscription video-on-demand (SVoD) market in India is expected to witness significant growth in the coming years. According to the report, the SVoD market is projected to expand by 51% and reach 90-100 million users by 2022. This growth can be attributed to various factors, including the availability of cheaper data plans, increasing internet penetration, and the rising popularity of digital streaming platforms.
The affordability and accessibility of data services have played a crucial role in driving the adoption of SVoD platforms. As data costs have become more affordable, a larger portion of the population has gained access to high-speed internet, enabling them to stream content on demand. The increasing internet penetration in both urban and rural areas has further facilitated the growth of the SVoD market.
The report also highlights the significant increase in data consumption in recent years. Data consumption has risen by 40-50 times since 2014, indicating the growing appetite for digital content. This surge in data consumption has contributed to the quadrupling of the share of digital content in total video watch time. Viewers are increasingly turning to digital platforms for their entertainment needs, leading to the proliferation of OTT platforms.
Looking ahead, the SVoD market is projected to touch $13-15 billion by 2030, reflecting the potential for substantial revenue growth in the coming decade. The continuous expansion of the SVoD market is expected to drive investments in content production, infrastructure development, and technological advancements in the digital streaming space.
The growth of the SVoD market not only presents opportunities for streaming platforms but also benefits content creators, production houses, and the overall media and entertainment industry. It provides a platform for diverse content offerings, giving viewers access to various genres, languages, and formats.By 2030, the subscription video-on-demand (SVoD) market is projected to account for 55-60% of the total over-the-top (OTT) revenue in India, while advertising-based video-on-demand (AVoD) will make up the remaining 40-45%. As of 2021, the estimated number of SVoD users in India stood at 70-80 million.
Investments in original local content will play a crucial role in the growth of the SVoD market in the coming years. The report emphasizes the significance of creating original content in local languages to cater to the diverse preferences of Indian viewers. Between 2018 and 2021, there has been a notable increase of 60-70% in local language original programming. This rise in local content production has been accompanied by a 30-40% increase in investments, reaching approximately $600-700 million.
The focus on original local content is driven by the recognition that it resonates well with Indian audiences, who seek stories and narratives that are relatable to their cultural context. Streaming platforms are investing in creating content that reflects the cultural diversity and regional preferences of different states and communities in India. This approach helps attract and retain viewers, leading to the growth of the SVoD market.
The report’s findings highlight the growing importance of the Indian market for global streaming platforms and the increased competition among local and international players. Investments in original local content provide a wider range of options for viewers and support the growth of the domestic entertainment industry.
It creates opportunities for local talent, production houses, and the overall ecosystem.K. Madhavan, Chairman of the CII National Committee on Media and Entertainment and President of The Walt Disney Company India and Star India, stated that the media and entertainment (M&E) industry has always been at the forefront of disruption, and this trend will continue in the coming decade. Madhavan emphasized the need for new solutions and innovative approaches, even in fundamental areas such as talent acquisition and impact measurement for advertisers on digital platforms.
Madhavan’s statement highlights the industry’s recognition of the need to adapt to the rapidly evolving landscape. With technological advancements and changing consumer behaviours, the M&E sector must continually innovate to stay relevant and meet the expectations of its audiences.
In terms of talent, Madhavan emphasizes the importance of nurturing a skilled workforce that can effectively navigate the challenges and opportunities brought about by digital transformation. The industry needs to attract and retain talent that possesses the right skills and expertise to drive innovation and growth.
Furthermore, Madhavan highlights the need for new methodologies to measure the impact that M&E companies deliver to advertisers on their platforms. With the rise of digital advertising and personalized targeting, traditional metrics may no longer suffice. The industry must develop new approaches and tools to gauge the effectiveness and reach of advertising campaigns accurately.
Overall, Madhavan’s statement underscores the industry’s commitment to innovation and the recognition that traditional approaches may no longer be sufficient in the ever-changing M&E landscape. By embracing new ideas, leveraging technology, and nurturing talent, the industry can continue to evolve and deliver compelling experiences to audiences while providing effective solutions for advertisers.
