Top Story


Home >> Media - Others >> Article

M&E industry to grow 13 pc in 5 years to Rs 1,091 bn: FICCI-KPMG report

Font Size   16
M&E industry to grow 13 pc in 5 years to Rs 1,091 bn: FICCI-KPMG report

The FICCI-KPMG report released on the inaugural day of FICCI Frames 2010 paints an optimistic picture for the Indian Media and Entertainment (M&E) industry. According to the report, this industry is projected to grow at a compound annual growth rate (CAGR) of 13 per cent to reach a size of Rs 1,091 billion by 2014. The M&E industry stood at Rs 587 billion in 2009, a growth of 1.4 per cent over the previous year.

The report states that the industry had gone through a tough phase due to the economic slowdown and had cut down on advertising spends. However, the industry witnessed a recovery in the last quarter of 2009 and is expected to continue going forward. 2010 is expected to see the industry coming out of the shackles of the slowdown and ad spends will increase. Incidentally, the subscription revenues of TV and print grew by 8.5 per cent in 2009 to reach Rs 241 billion.

Some sectors were impacted more than the others such as OOH, films and radio, which registered negative growth during the year. In 2010, they are expected to recover somewhat with a moderate growth rate. Last year, print showed a very moderate growth, whereas the TV industry showed a good growth rate. Music, Internet, gaming and animation brought reasons to cheer for the industry with their growth rates touching double digits, albeit on a smaller base.

Advertising spends grew at CAGR of 10 per cent in the past three years, with almost flat growth in 2009. Going forward, it is expected to exhibit a robust CAGR of 14 per cent over the next five years. Potential upsides could take this higher.

Growing potential of the regional markets, penetration of newer digital TV distribution platforms, increasing competition, innovation across product, processes, marketing and distribution models and growing importance of pay audiences were some of the key highlights of the previous year. However, it was DTH, which proved to be a very successful medium and helped in increasing the pay TV subscriber base even during challenging market conditions. IPL as a sports property has grown from strength to strength and is here to stay with advertising revenue growth of 80 per cent to reach Rs 4.5 billion in 2009.

Speaking on the occasion, Dr Amit Mitra, Secretary General, FICCI, said, “The media and entertainment industry represents the face of consumers in India. It is a part of our daily life and touches the maximum number of people. Despite a challenging 2009, I am excited about the potential of the industry to perhaps grow beyond 13 per cent per annum over the next few years.”

Rajesh Jain, Head - Media & Entertainment, KPMG in India, noted, “The year 2009 saw the M&E industry growing through a tough phase as advertising revenues were impacted in line with the challenging economic scenario. However, the subscription revenues continued to grow. Industry players looked at sustainable cost optimisation and sought means to better connect with their customers. The untapped potential for growth in media reach, impact of digitisation and convergence, better consumer understanding, sustained efforts in innovation, and enhanced penetration of regional markets all augur well for the industry.”

The projected 13 per cent growth rate per annum for the sector for the next five years will be driven on the back of factors such as favourable demographics, expected recovery in the GDP growth rate, strong long term fundamentals of the Indian economy, expected rise in advertising to GDP ratio as compared to developed economies, and increasing media penetration.


Siddharth Kumar Tewary, Founder, Chief Creative, One Life Studios and Swastik Productions, on owning the IP on his most ambitious project 'Porus,' the risk of recovering its cost and his distribution strategy

Webscale plans to build the brand around smooth operations for the e-commerce sector and then move on to demand generation

Shriya Ghate, Business Head, Tinkle, spills the beans on the company's vision for its special line of merchandise launched to celebrate its 37th anniversary, its pricing, marketing strategies, and more

Vivek Patni, Director of Wonder Cement, on the current marketing strategies and challenges that brand owners face

Videocon D2H and Hindustan Lever continue to dominate BARC's Top 10 Brands and Top 10 Advertisers for week 45

The series will be telecast on SONY TEN 1 channels with English commentary and on SONY TEN 3 channels with Hindi commentary

The new TVC, which is created by Dharma 2.0, is a step towards keeping cities and surroundings clean