By TIOL News Service

NEW DELHI, OCT 25, 2016: THE Indian media and entertainment industry is at the cusp of pivotal movement in history, predominantly driven by digital media and increasing connected rural consumer, with potential to grow 3-4 times over the next 7 years. The CII-BCG report will be released on Tuesday at the 5 th edition of the CII Big Picture Summit in New Delhi. The report t foresees the future of Indian media and entertainment industry and its roadmap to achieving its USD 100 billion vision

Three key opportunities will be the drivers of consumption growth are - tapping the rural un-connected consumer, capturing a large share of time of the digitally connected consumer and a supply explosion for strategically segmented audiences.

Mr. Chandrajit Banerjee, Director General, Confederation of Indian Industry said “With smartphones and mobile data becoming affordable, it is estimated that the number of connected rural consumers will increase from about 120 million in 2015 to almost 315 million in 2020, leapfrogging over 30% year-on-year. Rural consumption in recent times has been growing at a faster pace than urban consumption patterns.”

“This is because of pent-up demand and the willingness of rural consumers to trade-up to latest technologies such as HDTV channels and 4G mobile devices. With the exception of radio, media penetration in rural areas is currently 30% (TV) to 60% (Internet). This is much lower than urban centers and represent a significant scope for future growth,” he added.

Adding to that, Mr. Sudhanshu Vats, Chairman, CII National Committee on Media & Entertainment and Group CEO, Viacom 18 Media Pvt. Ltd   said “ The CII Big Picture in its 5 th   edition will bring together bright minds of M&E leaders to navigate a successful path that would take our M&E sector to USD 100 billion. During the two days of this summit, M&E leaders will make bold predictions about the future of media and provide insights and diverse thinking on the new disruptions and new business models on the fast changing M&E environment .”

Segmented supply creates demand

There is a fairly wide disparity in media consumption within India. It has been observed that not all of India consumessignificantly lower volumes of media than our global counterparts. Over the years, some Indian states have typically been high consumption pockets, while others have proven to be characteristically low.

Deep-diving into sub-sectors

Television

The current size stands at INR 69,000 Crores. This growth is equally driven by advertising and subscription revenue. Subscription revenues continue to be the major contributor and accounts for two-thirds of the industry revenue driven by increasing penetration and broader access to cable channels. Advertising revenues in television has grown on the back of strong underlying economic growth and emergence of categories such as ecommerce as major advertisers.

Films

India is one of the largest producers of films and the second largest market in terms of admissions. Scarcity of screens  is one of the major roadblocks to growth. At just 9 screens per million (versus China's 35 and US' 125) India has one of the lowest densities in the world and multiplexes are far and few. Further, only a third of the screens are in a good condition to release top movies.

Print

India is one of the major global markets where newspaper advertising revenue has grown over the last five years driven. Digital, however, has had its share of effect on the Indian newspaper sector. In the period between 2010 and 2016 it lost 8% of ad market share to digital and circulation of English newspapers has declined. Nevertheless, India's demographic and socio-economic parameters offer further leeway for growth of print in the medium term.

Radio

The growth of Radio has predominantly been driven by launch of private FM channels and increase in consumption through in-built FM services in feature and smartphones.Despite strong growth over the years, radio is still underrepresented in India with only 4.7% share of ad market compared to the global average of 6.5%, owing to supply constraints.

Music

The Indian music industry reported the slowest sub sector growth in the M&E sector. The industry has struggled for last few years to find a suitable legal form of music platform which is capable of hitting critical mass in music consumption and limit the impact of piracy. However, Digital streaming growth has given new lease of life for the music industry.

To conclude, the vision of growing to be a USD 100 Bn industry in a decade is a bold one, but the vectors for the next wave of growth - namely focus on Internet, tapping into rapidly urbanizing rural consumers and supplying specialized content – make it an aspirational one.Collaboration, convergence and co-ordination across stakeholders will thus be the key pillars driving exponential growth and expansion in the Indian M&E industry.