Analysts have attributed the growth of the digital sector to the success of subscription-based business models and India’s attractiveness as a destination for content production and post-production.
India’s media and entertainment (M&E) sector reached Rs 1,820,000 crore in 2019, growing nearly 9% from 2018, an EY-FICCI report released on Friday revealed.
The report states that digital media overtook filmed entertainment to become the third segment of the M&E industry in 2019, with the top two being television and print media, respectively. Analysts have attributed the growth of the digital sector to the success of subscription-based business models and India’s attractiveness as a destination for content production and post-production.
In 2019, digital media grew 31% from 2018 to reach Rs 22,100 crore and is expected to reach Rs 41,400 crore by 2022, with a CAGR of 23% – advertising in the space has increased by 24% to reach Rs 19,200 crore as more and more people consume content on digital platforms. Digital advertising accounted for 24% of the total industry pie. India has around 68.8 crore of Internet subscribers and nearly 40 crore of smartphone users, according to analysts in the report. Paid digital subscribers crossed 1 crore for the first time as sports and other premium content were placed behind a paywall. Subscription revenue thus increased 106% in 2019 compared to the previous year to reach Rs 2,900 crore.
TV advertising increased 5% to Rs 32,000 crore in 2019, while subscription revenue increased 7% to Rs 46,800 crore compared to 2018. Analysts noted that television as a medium will continue. to be the main source of advertising revenue even in 2025, touching as much as Rs 57,000 crore.
Online gaming maintained its position as the fastest growing segment thanks to transaction-based gaming, the top fantasy sports, according to the report. Online gamers were estimated at 36.5 crore in 2019.
The report, however, did not take into account the impact of the coronavirus on the industry. “The coronavirus epidemic will have a significant negative impact on the (M&E) industry, the situation continues to evolve in India and in many parts of the world. The magnitude of the impact cannot be estimated immediately, ”said Ashish Pherwani, partner and responsible for monitoring and evaluation at EY India.
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