After a brief decline during the pandemic, the global entertainment and media industry is poised for strong growth – and will approach a valuation of $3 billion by the end of 2026. New research suggests that the UK will be the first market in Europe in this same time.
The UK entertainment and media market is expected to continue to gain ground over its closest competitors, according to new research from PwC. By 2026, it is expected to be worth almost £100 billion, which will see the domestic market overtake Germany.
According to the study, digital consumption is the main driver of entertainment and media growth, which may have given it an edge over its closest rivals.
One of the UK’s strengths is the ready availability of high-speed internet access, and during the lockdown this helped facilitate a huge increase in e-commerce, the effects of which are still being felt. As a result, entertainment and media revenues in the UK are already expected to reach £83bn this year.
High levels of e-commerce and online shopping in the UK have also changed the way businesses deploy their advertising budgets online, further boosting UK entertainment and media revenues.
Internet advertising revenue is expected to reach £26bn in 2022 and is expected to grow by 6% per year until 2026. This will equal just over a third of overall entertainment and media revenue, and will help the sector broadly to benefit An expansion of 4% per year for the next four years – the second fastest growth rate in Western Europe – generating estimated revenues of £97bn.
The global market is expected to reach a combined value of $2.9 trillion. It is expected to grow at an average of 4.6% over this period, but the growth rate is expected to slow significantly towards the end of PwC’s time frame – falling to 3.1% by 2026, from growth of 4% in the UK.
Mary Shelton Rose, Partner and Head of UK Technology, Media and Telecoms at PwC, said: “The UK entertainment and media market should emerge from recent years of uncertainty for greater clarity on the forces underlying sustainable growth. A vision of what the dynamic entertainment and media landscape will look like in 2026 is taking shape – an industry that is more digital, more mobile and more dependent on advertising in all its forms.
To this end, entertainment and media growth in the UK will also be driven by mobile, with mobile internet advertising accounting for two-thirds of internet advertising revenue by the end of the forecast period. The rise of mobile will also allow consumers to continue to invest in over-the-top (OTT) video providers – even as people again spend less time at home – making it the premier market for OTT in Western Europe and the world’s third largest market after the United States and China.
Overall OTT video revenue in the UK is expected to reach £3.6 billion this year, before growing by 6% each year until 2026.
Dan Bunyan, Partner at Strategy&, added: “OTT video has been one of the biggest beneficiaries of the shift to spending more time at home and the UK market is proving to be one of the biggest markets in the world. for the greatest actors.
“While we expect growth to return to a more modest pace, we expect some service price increases to generate revenue over the forecast period as the pool of potential new subscribers shrinks. More OTT video providers venturing into live sports will also provide new opportunities and options for consumers.”