Farokh Balsara, partner and M&E leader at EY India, asked: “The Indian M&E sector reached Rs 1.5 trn in 2017, led by digital. With digital revenues expected to cross Rs 220 bn by 2020, has Indian M&E reached it’s digital tipping point?"
"We now need to re-imagine the Indian M&E sector,” Balsara suggested.
Ashish Pherwani, partner and M&E advisor at EY India, said: “Growth in 2017 was led by the digital, film and animation and VFX (visual effects) segments.”
Digital media has grown significantly over the past few years. And, continues to lead the growth charts in advertising. Subscription revenues are emerging and are expected to make their presence felt by 2020. In 2017, digital media grew 29.4 per cent (27.8 per cent, net of the impact of goods and services tax), on the back of 28.8 per cent growth in advertising and of 50 per cent in subscription.
Subscription was only 3.3 per cent of total digital revenues in 2016. It is expected to grow to 9 per cent by 2020. Around 250 million viewed videos online in 2017 and this is expected to double by 2020. Around 40 per cent of all mobile traffic came from the consumption of video services in 2015. This is expected to touch 72 per cent by 2020.
The TV industry
grew from Rs 594 billion in 2016 to Rs 660 billion in 2017, at 11.2 per cent (9.8 per cent, net of taxes). Advertising grew to Rs 267 billion, while distribution grew to Rs 393 billion and comprised 41 per cent of revenues. Distribution was 59 per cent of total revenues. At a broadcaster level, however, subscription revenues (including international subscription) made up about 28 per cent of the total. Advertising is 41 per cent of total revenues. The report expects this to grow to 43 per cent by 2020.
Print continues to hold the second-largest share of the sector, despite growing under 3 per cent to reach Rs 303 billion in 2017. The segment is estimated to grow at an overall CAGR of 7 per cent till 2020, with the non-English segment at 8-9 per cent and English a bit slower. This is expected despite the foreign direct investment limit remaining unchanged at 26 per cent for the sector, restricting access to foreign print players. And, despite imposition of the GST at 5 per cent on the advertising revenues of the print industry
for the first time in history. While magazines contributed 4.3 per cent to the print segment, the latter was largely at status quo, with not many significant new launches in 2017.
Films grew 27 per cent in 2017, on the back of box office (BO) growth, both domestic and international. Coupled with increased revenues from sale of satellite and digital rights. All sub-segments grew, with the exception of home video, and the film segment reached Rs 156 billion in 2017.
Hollywood and international films comprise the balance. The top 50 films contributed approximately 97.75 per cent of the total net box office collection. Box office collections of the top 50 films grew by 11.60 per cent in 2017. Regional movies drove the growth in number of releases in 2017. Screen count increased from 9,481 in 2016 to 9,530 in 2017. Number of Hindi movies crossing the Rs 1 billion mark was highest in 2017 among the past 5 years. From 31 movies in 2016, Hindi dubbed movies increased more than 3 times to 96 in 2017.