The Indian entertainment industry is one of the fastest growing sectors in India riding on the wave of the country’s good economic health. Fuelled by high consumer spending, especially on leisure, and changing lifestyles, the industry is poised to unfold a host of value-added features for the consumers and new revenue streams for players in each segment of the industry.
According to the latest FICCI-PriceWaterhouseCoopers study the Indian entertainment industry, which stands at over Rs 20,000 crore ($ 4.5 billion) today, is expected to grow at 18 per cent per annum compounded annually over the next five years to reach over Rs.45, 000 crore ($ 10 billion) by 2009. And the largest contributor to this growth will be the television industry, followed closely by the film segment.
The future of the television industry, according to the study, is digitalisation. Resolution of current challenges of distribution and digitalisation, will also define the content formats and the viewership patterns of the consumers in future.
The film industry will ride on the growth of multiplexes and digital distribution formats. 18 per cent year-on-year growth is also expected in this segment as in the case of television. Better realisations in box office collections, growth in collections from the overseas markets as a result of better marketing and distribution set-ups, and emergence of the home video market, will drive the growth of the filmed entertainment in the next five years.
Similar growth is projected for the Indian music industry, which is riding on the boom of re-mixes and video albums. Digital delivery formats, wireless mobile phones and Internet will be the emerging platforms and will bite into the traditional formats of CDs and cassettes.
The Radio industry is also set to boom. Availability of larger number of frequencies is expected to drive the segment by 22 per cent over the next five years. The present market is still untapped to a large extent and with rationalisation in the licence framework, the segment is expected to touch Rs 650 crore by 2009.
The live entertainment industry segment continued its steady growth in the past years and is expected to grow at similar levels in the coming years. The study points out that success in Animation and Gaming will be driven by co-productions and securing rights over content produced. This technology-intensive industry will evolve itself to come at par with the world standards, not only in terms of technological advancements but also creation of original content.
Finally, content is and will continue to be the king of entertainment in future and securing rights over the content will decide the strength of the players across all segments. Over the years, spending power has been steadily increasing in India. Between 1995 and 2002, nearly 100 million people became part of the consuming and rich classes. Over the next five years, 180 million people are expected to move into this segment. On an average, 30-40 million people are joining the middle class every year, representing huge spending on mobile phones, televisions, music systems and other similar goods, following a consumption pattern typically associated with rising income.
Though piracy continues to dampen the growth, measures taken by some companies to go digital and the increase in the number of digital cinemas, are helping in reducing its affect.