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Digital media powered growth in India's M&E industry in 2018: Report 

live mint , Mar 13, 2019

India’s media and entertainment (M&E) sector grew 13.4% year-on-year to touch ₹1.67 trillion in 2018, powered by digital platforms that grew 42% to ₹16,900 crore during the period, a new report said. The M&E sector in India is expected to cross ₹2.35 trillion ($33.6 billion) by 2021, at a compounded annual growth rate of 11.6%, according to the report by lobby group Federation of Indian Chambers of Commerce and Industry (FICCI) and consulting firm EY.

Digital will continue its scorching pace of growth to overtake filmed entertainment in 2019 and print by 2021, said the report titled A Billion Screens of Opportunity, released in Mumbai on Tuesday at FICCI Frames, an yearly media and entertainment industry event.

At 570 million, India has the second-highest number of Internet users after China, growing 13% annually and estimated to reach five million by 2021. The report estimates that approximately 2.5 million consumers in India are digital only and would not normally use traditional media.

Digital ad spends grew 34% to ₹15,400 crore and now account for around 21% of the ad market. Several broadcasters have started combining selling of ads across over-the-top (OTT) and linear platforms to enable better monetization of marque properties and increased utilization of digital inventory.

As far as the various video-on-demand services are concerned, advertising growth outpaced subscription growth and is expected to comprise 52% of the total pie by 2021. Digital subscription grew 262% to reach ₹1,400 crore in 2018, primarily on the back of telecom companies (telcos) bundling content with data packs to drive sales. Video subscription revenues grew almost three times in 2018 to reach ₹1,340 crore (with telcos making ₹350-400 crore out of this), on the back of new and relaunched video streaming platforms, growth of smartphones, spread of affordable broadband, regional language and exclusive content, and live streaming of major cricket and other impact properties.

“The M&E sector has a significant opportunity given India’s young demographics. The growth of digital infrastructure is further enabling Indians to fulfil the need for personal content consumption, across languages and genre. There is a large shift in consumer behaviour from mass produced content to specific content defined to audience segments," said Ashish Pherwani, partner and media and entertainment leader, EY India.

Further, the TV industry grew from ₹66,000 crore to ₹74,000 crore in 2018, a growth of 12% and is estimated to reach ₹95,500 crore by 2021, with advertising growth at 10% and subscription growth at 8%.

TV advertising grew 14% to ₹30,500 crore, while subscription grew 11% to ₹43,500 crore this past year. Television viewing households increased to 197 million, a 7.5% increase over 2016 with 77% of time on television spent on general entertainment content and film channels.

The impact of the new Trai tariff order where viewers can choose and pay for individual channels can have implications on total viewership, free television uptake, channel MRP rates and ad revenues, according to the report. However, 2019 promises further growth because of the Lok Sabha elections and the ICC World Cup.

Print accounted for the second largest share of the Indian M&E sector, despite being static and growing at 0.7% to reach ₹30,550 crore in 2018. The year witnessed a 26% growth in digital news consumers over 2017 when 222 million people consumed news online. Page views grew 59% over 2017 and average time spent increased by almost 100% to 8 minutes per day in 2018. Advertising revenues stood at ₹21,700 crore and subscription revenues grew marginally by 1.2% to ₹8,830 crore.

Newspaper advertising reduced by 1% while magazine advertising fell 10%, because of reduced ad volumes and pressure on effective rates.

Hindi newspaper publications continued to lead with 37% of total ad volumes, while share of English publications stood at 25%.

The Indian film segment grew 12.2% in 2018 to reach ₹174.5 billion, driven by the growth in digital rights and overseas theatricals. Domestic film revenues crossed ₹100 billion with net box office collections for Hindi films at ₹32.5 billion—the highest ever for Hindi theatricals. Overseas theatricals grew to ₹30 billion from ₹25 billion in 2017 where China became the largest international market for Indian content. Box office collections of Hollywood films in India (inclusive of all their Indian language dubbed versions) was ₹9.21 billion with Avengers: Infinity War emerging as the highest Hollywood grosser in India.

“The Indian M&E sector is entering a phase of accelerated growth. The status quo is being shattered by digital disruptions and that’s unshackling the creative economy in India like never before. These are exciting times for all it is to let our imagination and ambition guide us," said Uday Shankar, vice president, FICCI and chair, FICCI media and entertainment division.



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