Buoyed by the growing importance of the Internet as a distribution medium, and overcoming the global economic slowdown, the entertainment and media industry will grow at a 7.2 per cent compound annual rate to reach $1.2 trillion mark by 2005, says a PricewaterhouseCoopers survey.
Through 2005, entertainment and media spending in Asia/Pacific will grow at nearly seven per cent compound rate. It along with the double-digit growth of Internet advertising and access spending and television distribution (satellite, cable and DBS) will be the main drivers.
Notwithstanding, the recent drop in Internet sector market values, Internet would be as compelling a distribution medium in 2001 as it was in 2000. Growing consumer demand for on-line music, books, newspapers, and magazines, coupled with increased broadband Internet access, will allow on-line distribution of filmed entertainment to become a reality, the report says.
The PWC study sees the industry developing new business models that will stimulate the conversion from free distribution to paid Internet subscriptions, while solving copyright issues.
Latin America will have the fastest growing entertainment and media market of any region, with 12.5 per cent CAGR over five years. Economic stabilisation and foreign investment will be key drivers for the region.
After a year of old economy mergers and new economy shut-downs, consolidation within the entertainment and media industry - along with digital technology and global economic growth --- will be the other principal driver underlying the forecast through 2005. The benefits to the survivors of industry consolidation will continue to be substantial.