Media & entertainment to grow at 14%: FICCI–KPMG
MUMBAI: The Indian media and entertainment industry in 2016 was able to sustain a healthy growth on the back of strong economic fundamentals and steady growth in domestic consumption coupled with growing contribution of rural markets across key segments. These factors aided the industry to grow at 9.1 per cent on the back of advertising growth of 11.2 per cent, despite demonetisation shaving off 150 to 250 basis points in terms of growth across all subsegments at the end of the year, said an FICCI - KPMG Media and Entertainment Industry Report 2017 launched on Tuesday at FICCI Frames 2017 in Mumbai.
The big story in 2016 has been the evolution of FTA channels post expansion of rural measurement in the television segment coupled with the impact of the 4G rollout and the resulting price wars. Both these factors have resulted in media consumption penetrating deeper into India, resulting in a realignment of strategy by media companies and advertisers alike, it said. Compared to 2016, the industry is projected to grow at a faster pace of 14 per cent over the period of 2017-21, with advertising revenues expected to increase at a CAGR of 15.3 per cent. The year 2017 is likely to witness a marginally slower rate of 13.1 per cent as the economy recovers from the lingering effects of demonetisation and initial uncertainties arising from GST implementation.
Commenting on the industry’s performance and way forward, Uday Shankar, Chairman, FICCI M&E Committee and Chairman & CEO of Star India, said, “The industry has gulped down the bitter pill of demonetisation trusting its long-term benefits and yet is set to bounce back to a steady growth, thanks to strong fundamentals. Building solid infrastructure and continued government support will help the industry reach the tremendous potential it holds for employment and creating socio-economic value for the country. A commitment towards a quick transition to digitisation will ensure growth for all stakeholders.”
Girish Menon, Director, Media and Entertainment, KPMG in India, stated, “2016 was a mixed bag for the industry with digital media making its way to the centre stage rapidly from being just an additional medium. It is compelling existing players to rethink their business models. To accelerate growth, M&E organisations must rebuild their strategies to fit and thrive in the changing, digitally-oriented landscape. Nimbleness and flexibility will be at the core of sustainable businesses.”