Entertainment and media revenues rebound strongly after pandemic crisis; the shift to streaming, games and user-generated content is transforming the industry: PwC
Other discoveries from this year Outlook include:
- The 3.8% drop in global E&M revenue, US $ 2.1 billion in 2019 at US $ 2.0 billion in 2020, was the largest year-on-year decline perspectives 22 years old. But there were bright spots in a number of E&M segments created by changing consumer demand.
- From 2021 to 2025, we forecast global E&M revenue to grow at a healthy compound annual growth rate (CAGR) of 5.0%, bringing the industry revenue to 2.6 billion US dollars in 2025.
- Traditional TV / home video remains the largest segment of E&M consumers ($ 219.0 billion) but will continue to contract (-1.2% CAGR) over the next five years.
- Video streaming has exploded in 2020 and its growth trajectory will continue. Video-on-demand streaming (SVOD) is expected to grow at a 10.6% CAGR through 2025, making it a $ 81.3 billion industry. Meanwhile, cinema revenues are expected to rebound in 2021 as lockdowns ease, but will not return to pre-pandemic levels until at least 2024.
- Revenues from video games and esports continue to climb rapidly, reaching 147.7 billion US dollars in 2020, with a CAGR of 5.7% expected to expand the segment to become an almost $ 200 billion business (194.4 billion US dollars) by 2025.
- Virtual Reality (VR) is the fastest growing E&M segment, albeit from a small base. Its turnover jumped 31.7% in 2020 to $ 1.8 billion and are expected to maintain a CAGR of 30% + over the next five years to achieve US $ 6.9 billion company in 2025.
- Music is poised for robust growth after a massive 74.4% drop in live music revenue in 2020. We expect total music revenue to grow at a CAGR of 12.8% over the next five years, fueled by digital streaming, which will grow into a $ 29.3 billion business by 2025, as well as a return to live shows.
- Internet ad spend increased 9% to $ 336 billion in 2020, surpassing non-internet ad spend for the first time, and is expected to experience strong growth of 7.7% CAGR over the next five years.
- Internet access accounted for 34% of E&M spending in 2020 and will increase at a CAGR of 4.9%, as of 2020 $ 694 billion at 880 billion dollars in 2025. Mobile Internet access will drive market growth, with revenue increasing at a CAGR of 6.1% from $ 449 billion in 2020 at $ 605 billion in 2025, supported by the spread of 5G, advancements in handset technology and premium content bundles.
Werner Ballhaus, leading global entertainment and media industry partner, PwC Germany, said: “The pandemic slowed down the entertainment and media industry last year, but it also accelerated and amplified the power shifts that were already transforming the industry. Office shifting to streaming platforms, content moved to mobile devices or increasingly complex relationships among content creators, producers and distributors, the dynamics and power within the industry continue to change. Our perspectives show that thirst for content, continued advancements in technology, and new business models and means of value creation will drive industry growth for the next five years and beyond. “
Generation change: young people will be served
It is therefore not surprising that many young consumers have little knowledge or interest in traditional media. On the other hand, media platforms designed for young consumers or which allow light and authentic content have exploded. Gaming is at the heart of the youth movement and is becoming a major driver of data consumption – in fact, it is fast becoming the fastest growing content category in this regard, accounting for 6.1% of the total. total data consumption worldwide by 2025, up from 4.7. % in 2020.
Regulatory changes: decline on platforms
Another change impacting E&M is the regulatory review of big tech. Antitrust pressures have increased with calls to disband major tech platforms as well as government proposals for new media regulations. Changes to current regulatory regimes are inevitable and it is vital that E&M actors integrate regulatory risks into their planning processes.
CJ Bangah, Senior Director of Technology, Media and Telecommunications, PwC in the United States, added: “2020 was unprecedented, and we expect the kind of growth and contraction within and between E&M segments that we have experienced to continue. The power of digital, including the early stages of 5G use cases and the exponential growth of streaming, along with consumer adoption of new and improved experiences is a constant force for change. The dynamic changes within the E&M ecosystem are likely to expand as the industry responds to the changing landscape of future consumption patterns. “
Notes to Editors
About the Global Entertainment and Media Outlook
The PwC Global Entertainment & Media Outlook, accompanied by the publication “Power Shifts – 2021”, provides an in-depth analysis of global E&M consumer and advertising spending. The Outlook includes five-year historical data and commentary and five-year forecasts for 14 industry segments in 53 territories. Segments include books; business to business; cinema; data consumption; Internet access; music, radio and podcasts; newspapers and magazines for the general public; OTT video; TV and home video; as well as Internet, outdoor and television advertising. Learn more about www.pwc.com/outlook.
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