The Indian entertainment and media industry is projected to grow 18 per cent annually over the next five years and more than double in size to Rs 115,700 crore by 2012, according to a research study by consulting firm PricewaterhouseCoopers.
Radio, online advertising, gaming and animation will drive growth of the industry, which has already seen robust expansion in recent years, the study said. In absolute terms, however, television will continue to contribute a large share _ a little more than half -- of the industry’s revenue, followed by the print media, the study said.
The study, which was done at behest of Federation of Indian Chambers of Commerce and Industry, also noted growing contribution of foreign capital to India’s entertainment and media business.
Foreign investments worth Rs 8.5 billion (Rs 850 crore) were made in the sector last year, it said.
Online advertising, which is very small in size – Rs 270 crore, is projected to grow 32 percent annually, as distribution of content over digital platforms like internet and mobile phones catches on.
“Digitisation is the future of most segments and companies have to adopt this revolution with appropriate infrastructure, relevant business models and technology,” Timmy Kandhari, who led the research, said in a statement.
Animation and gaming businesses are also expected to grow rapidly, averaging 25 per cent over the next five years, while Radio, which is on a comeback mode in this country will expand at a 24 percent clip, the study said.
About 560 new radio stations may be added over the next five years. If the government accepts the regulator’s recoomendations to allows news on radio and increasing the ceiling on foreign investment, it would make this medium more popular with advertisers and aid its growth, the study said.
The television industry, Kandhari said, has yet to exhaust all of its potential for growth. It would get a boost if some lingering problems relating to distribution were quickly resolved.
He cited the case of conditional access system, or CAS, which has failed to take off in a big way despite being made mandatory last year.
CAS is a digital mode of transmitting channels trough a set-top box or a satellite in the case of DTH (direct-to-home service). Unlike cable TV where you a monthly rent and get all channels that the broadcaster wants you to see, you can pay for the channels you wish to see via conditional access. For 2007, overall revenues of the entertainment and media industry were estimated at Rs. 51,300 crore.