While the Union budget was a slight disappointment for the media and entertainment sector since there was no mention of benefits for the direct-to-home (DTH) broadcasting sector or the projection of movies, digital players can look forward to better days given the government’s focus on digital. economy.
Finance Minister announced Rs 10,000 Crores for the ‘Bharat Net’ project to provide high-speed broadband connection in 1.5 Lakh gram panchayats by the end of 2017-2018, with fiber optics already laid over 1.55 Lakh kilometers so far.
Siddhartha Roy, CEO of Hungama.com, said: “The focus on digital infrastructure in the current budget is extremely encouraging. Greater reach of broadband and data services in urban and rural areas of India will lead to an inclusive digital economy, encouraging more people to embrace digital media, boosting consumption and transactions across the support. Better data quality should also give a boost to the video-led digital entertainment industry, which is certainly on the verge of massive growth.
As the consumption of digital content is on the rise, media and entertainment companies are investing huge amounts of time and resources in the development and distribution of digital content. Independent players and media networks have both launched over-the-top (OTT) portals with varying degrees of success.
Deepak Lamba, CEO of Worldwide Media, said: “The budget has reinforced India’s huge shift towards digitalization, especially with the proposed rollout of optical cables to increase internet penetration in rural India. This is a great benefit for content creators like us, as it will drive the consumption of digital content across online and mobile platforms. New momentum on payments and digital transactions will eventually help the subscription model. In addition, the government’s decision to abolish the FIPB (Foreign Investment Promotion Board) to facilitate the inflow of FDI (foreign direct investment) and to consider the liberalization of the FDI policy will have a positive impact on the long term for actors in all sectors.
Sudhanshu Vats, CEO of Viacom18 Group and Chairman of the Media and Entertainment Committee of the Confederation of Indian Industry, said: “I am particularly excited about the strong push for digitalization reforms and look forward to the increase in digital transactions in the country. This also bodes well for digital consumption of video content. The decision to cap political cash donations at Rs 2,000 and all cash transactions at 300,000 are also bold moves which are in line with the government’s commitment to eradicating corruption. Swachh Bharat being close to our hearts, the budget further builds on this theme in a welcome move. I have said it before and I will say it again: as As the M&E sector, we have a lot to gain from the dynamism of the economy at the global level and I believe that this budget has delivered on this front.
Mobile content consumption has been leading the growth of online content consumption and with the proliferation of smartphones continuing in India, OTT companies are hoping to make hay while the sun shines. With an increased push on broadband access to rural India, content creators can now hope to reach markets that have hitherto been relatively bleak in media. While it won’t make a big difference in terms of subscription revenue, advertising revenue will certainly increase once rural markets begin to access and embrace the digital consumption path for content as well.
Abhesh Verma, COO, nexGTv adds, “I appreciate the government’s clear commitment to fueling the growth of digital adaptation by focusing on the underlying infrastructure. This is reflected in the availability of more spectra and a budget allocation of 10,000 crore for laying optical fiber beyond the 1.55,000 km already laid. The availability of bandwidth will help Indians to adapt to the digital lifestyle and thus contribute to the growth of the whole ecosystem. Additionally, the tax cut for people, especially those at the bottom of the pyramid, will increase their disposable income on hand, part of which will also be spent on mobility, data and entertainment, to benefit OTT players. .”
Vats adds: “There had been a lot of speculation about the economic downturn after demonetization. With this budget, the government has taken important steps to revive the economy in a structured way, building on the promise of transparent growth. Measures to further liberalize the FDI regime, coupled with the abolition of the FIPB and tax reforms for MSMEs (micro, small and medium-sized enterprises), are bound to have an impact for the foreseeable future. This budget saw positive solutions to fight poverty in our country, including one of the highest allocations of funds to the MNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) and streamlining the rate for tax brackets lower personal.
The industry also agreed that rolling out the GST (goods and services tax) would be a welcome reform. Currently, sectors such as theatrical exhibition and DTH have to bear multiple taxes at the state and central level. Rolling out an inclusive tax will result in uniformity and some relief for these sectors.