Introduction
The Indian Media and Entertainment (M&E) industry is a sunrise sector for the economy
and is making high growth strides. Proving its resilience to the world, the Indian M&E
industry is on the cusp of a strong phase of growth, backed by rising consumer demand
and improving advertising revenues. The industry has been largely driven by increasing
digitisation and higher internet usage over the last decade. Internet has almost become
a mainstream media for entertainment for most of the people.
The Indian advertising industry is projected to be the second fastest growing advertising
market in Asia after China. At present, advertising revenue accounts for around 0.38 per
cent of India’s gross domestic product.
Market Dynamics
Indian media and entertainment (M&E) industry grew at a Compound Annual Growth
Rate of 12.25 per cent from 2011-2017; and is expected to grow at a CAGR of 11.6 per
cent to touch Rs 2,032 billion (US$ 31.53 billion) by 2020 from Rs 1,308 billion (US$
19.46 billion) in 2016.The industry provides employment to 3.5-4 million people,
including both direct and indirect employment in CY 2017.
The number of newspaper readers in India has increased by 38 per cent between CY
2014 and CY 2017 to reach 407 million.
India is one of the highest spending and fastest growing advertising market globally.
Recent development/Investments
The Foreign Direct Investment (FDI) inflows in the Information and Broadcasting (I&B)
sector (including Print Media) in the period April 2000 – September 2017 stood at US$
6.86 billion, as per data released by Department of Industrial Policy and Promotion
(DIPP).
The Indian digital advertising industry is expected to grow at a Compound Annual Growth Rate (CAGR) of
32 per cent to reach Rs 18,986 crore (US$ 2.93 billion) by 2020, backed by affordable data and rising
smartphone penetration.
India is one of the top five markets for the media, content and technology agency Wavemaker where it
services clients like Hero MotoCorp, Paytm, IPL and Myntra among others
After bagging media rights of Indian Premier League (IPL), Star India has also won broadcast and digital
rights for New Zealand Cricket upto April 2020.
Total number of Mergers and Acquisition deals increased to 63 in FY17 from 58 in FY16
Government Initiatives
The Telecom Regulatory Authority of India (TRAI) is set to approach the Ministry of
Information and Broadcasting, Government of India, with a request to fastrack the
recommendations on broadcasting, in an attempt to boost reforms in the broadcasting
sector. The Government of India has agreed to set up the National Centre of Excellence
for Animation, Gaming, Visual Effects and Comics industry in Mumbai. The Indian and
Canadian Government have signed an audio visual co-production deal to enable
producers from both the countries exchange and explore their culture and creativity,
respectively.
The Government of India has supported Media and Entertainment industry’s growth by
taking various initiatives such as digitising the cable distribution sector to attract greater
institutional funding, increasing FDI limit from 74 per cent to 100 per cent in cable and
DTH satellite platforms, and granting industry status to the film industry for easy access
to institutional finance.
Road Ahead
The Indian Media and Entertainment industry is on an impressive growth path. The
industry is expected to grow at a much faster rate than the global average rate.
Growth is expected in retail advertisement, on the back of factors such as several
players entering the food and beverages segment, e-commerce gaining more popularity
in the country, and domestic companies testing out the waters. The rural region is also a
potentially profitable target.
Exchange Rate Used: INR 1 = US$ 0.0155 as on FY2018
References: Media Reports, Press Releases, Press Information Bureau, Department of
Industrial Policy and promotion (DIPP), Union Budget 2016-1, KPMG – FICCI Report
2017
https://www.ibef.org/industry/media-entertainment-india.aspx
Film Industry in India - Statistics & Facts
India has been the largest movie producer worldwide for the last few years, releasing more than a
thousand films each year. The country is home of the one of the most important cities in the
global film industry, Mumbai. Previously called Bombay – name which gave origin to the term
Bollywood
The drama and colors seem to be appealing to the Indian audience as well, considering the
domestic figures for Indian films are impressive. There were two thousand multiplex
theaters in India as of 2015. A year later, more than 2.2 billion movie tickets were sold in
India, placing the country as the leading film market in the world. In comparison, about 1.25
billion movie tickets were sold in second-placed China in 2016.
t's the English invasion all over again — only this time, it's on the small screen.
Although it's a niche genre that fetches low advertising rates and the content costs are high, there's been a
proliferation of English movie and entertainment TV channels in India, much to the delight of viewers who can now
watch cult shows telecast at the same time as in the US or just a little later, the best in reality TV and binge watch
shows.
The small screen is keeping in step with the growing popularity of Hollywood films in India, seeking to emulate their
box-office success. This year, two back-to-back releases from Universal — Fast & Furious 7 and Jurassic World —
both garnered over Rs Rs 100 crore each while Marvel'sAvengers: Age of Ultron grossed Rs 84 crore, which is more
than what most Bollywood films can lay claim to.
"There is clearly a hunger for the latest English content — across movies and drama — which is driving investments,”
said Ajay Shah, partner, transaction advisory services at EY. "The genre draws in a viewer whose profile is the target
audience of the high-end advertisers and while ad rates may not have risen, it is the additional ad revenue pie that
the broadcasters are looking at.”
There are 16 English movie channels available in India today, compared with only seven in 2007, according to TAM
Media Research, and 20 English entertainment channels against six. This growth has taken place even as the cost of
content has tripled over the past few years and includes the emergence of premium channels by HBO and Star.
"Increasing penetration of premium channels is a win-win situation for both distribution platforms and broadcasters —
they have paved the way for pay TV,” said Monica Tata, who resigned this week as MD at HBO India. "We tried pay
channel for the first time in India with reasonable success but the growth ahead depends on the combination of
content, pricing and packaging.” Tata said HBO has seen a 10-fold growth in its pay channels, with its exclusive
showcasing of the cult series Game of Thrones being the most successful.
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Last Updated: June, 2018
The Indian media industry has tremendous scope for growth in all the segments due to
rising incomes and evolving lifestyles. Media is consumed by audience across
demographics and various avenues such as television, films, out of home (OOH), radio,
animation and visual effect (VFX), music, gaming, digital advertising, and print.
The Media & Entertainment industry is anticipated to grow at a Compound Annual
Growth Rate (CAGR) of 13.9 per cent during 2016-21 to reach US$ 37.55 billion. The
industry provides employment to 3.5-4 million people, including both direct and indirect
employment as of 2017.
Advertising expenditure in India is expected to grow 13 per cent year-on-year to Rs
69,346 crore (US$ 10.71 billion) in 2018 and Rs 1.07 trillion (US$ 16.70 billion) by
2020. The Indian digital advertising industry is expected to grow at a CAGR of 32 per
cent to reach Rs 18,986 crore (US$ 2.93 billion) by 2020. India’s digital revenues are
expected to reach US$394.22 million by 2021. India is the second largest television
market in the world with US$ 10.14 billion in revenue in 2017. The Indian film industry is
expected to grow at a rate of 11.9 per cent by 2020. India digital advertising market has
reached Rs 8,202 crore (US$ 1.27 billion) in 2017 and is forecasted to grow at a CAGR
of 32 per cent to reach Rs 18,986 crore (US$ 2.95 billion) by 2020.*
The Government of India has supported this sector's growth by taking various initiatives
such as digitising the cable distribution sector to attract greater institutional funding,
increasing Foreign Direct Investment (FDI) limit from 74 per cent to 100 per cent in
cable and Direct-to-home (DTH) satellite platforms, and granting industry status to the
film industry for easy access to institutional finance.
https://www.ibef.org/industry/entertainment-presentation
BUSSINESS STANDARD
The Indian media and entertainment sector revenues reached $22.7 billion in 2017, and are
expected to cross $31 billion by 2020, at a compound annual growth rate (CAGR) of 11.6
per cent, said a study released here on Sunday.
The report by the Federation of Indian Chambers of Commerce and Industry (Ficci) and
Ernst & Young LLP was launched here by Information and Broadcasting Minister Smriti Irani
at the inaugural session of the Ficci Frames 2018.
"The media and entertainment sector continues to show great potential, and we expect it to
grow on the back of India's need for escapism, knowledge and social acceptance. Media
and entertainment has become a necessity of life, and provides exciting opportunities for
existing and new companies."
The report also said the digital media will be a game changer.
Uday Shankar, Chairman, Ficci Media and Entertainment Committee, said the sector has
become a "critical contributor to the economic and social narrative of the country".
It generates millions of jobs directly and indirectly, contributes to economic growth with a
rate almost twice the GDP and provides an immeasurable ancillary contribution by serving
as a platform for the growth of several other industries," Shankar said.
"The future of the sector is getting built on three pillars - engineers, designers and
storytellers," Shankar added.
As per the report, the reach of television increased to 64 per cent of the country, and with
distribution now largely digitized, this has brought in more addressability. Bucking
international trends, the print and radio segments continued to grow, as well as build their
digital presence.
Indian films -- both Hindi and regional -- grew their international appeal with several doing
well at the global box office.
It witnessed a growth of 27 per cent due to a combination of high growth in overseas
theatrical releases, especially in China, growth in satellite rights values and domestic box
office collections.
Increase in the demand for global content has also resulted in the growth of the animation,
VFX and post production segment, where India has become known for its high quality and
efficient capabilities.
Digital subscription and online gaming are showing signs of exponential growth, but on a
small base.
The digital world is giving a boost to the overall sector.
"We estimate that there are around 1 to 1.5 million digital only consumers in India today,
who would not normally use traditional media, and we expect this customer base to grow to
around 4 million by 2020, and generate significant digital subscription revenues for the
media and entertainment sector," read the report.
According to John Harrison, Global Media and Entertainment Leader - EY, "India's
conducive regulatory environment and high volume of content consumption hold significant
potential for foreign investments in the sector."
(FORBES)India's Film Industry --
A $10 Billion Business Trapped In
A $2 Billion Body
India has the largest democracy in the world. A huge and fast
growing middle class. It makes more movies than any other
country, 1,500 to 2,000 annually. And its people are famously
fanatical about those movies and their movie stars. By almost any
measure, India should be the world’s highest grossing territory in
theatrical revenue.
So why does India’s movie industry gross only $2 billion per year
at the box office?
That amount is just a fifth of North America’s gross, despite a
population more than three times larger. Less than a third the size
of China’s industry. Even less than Japan’s, which has one-tenth
the population that India has and far fewer movie screens.
1. India is severely under-screened. With just 1
screen per 96,300 residents, it is the world’s most
under-screened major territory. The U.S., by contrast,
has 1 screen per 7,800 residents. China, which until
recently was even less saturated than India, has been on
a cinema building binge and now has 1 screen per
45,000 residents. With such a deep shortage of movie
theaters and screens, many of India’s fanatical movie
fans are simply unable to see movies in the theater.
2. India’s movie theaters are sub-par. More than 10,000 of
the country’s 13,000 screens are single-screen
cinemas. The economics of these theaters are
inferior to modern multiplex cinemas, which can
charge ticket prices that are double those of single-
screen theaters. And because they can operate more
efficiently, multiplexes can generate higher capacity
yields and revenues per seat. India clearly has an
infrastructure problem
3. India’s film economy is splintered into several regional
industries. Unlike North America, China, and most
major territories, where the vast majority of films
are distributed in a single language, India makes
and distributes films in more than 20 different
languages. The regionalization, and linguistic
politicization, of the country’s movie business saps
its overall strength. Average production and
marketing costs are higher and profits are lower
than they would be if India’s film industry were
more integrated
4. Ticket prices in India are too low. It’s true that India’s
population is mostly poor, but that doesn’t fully explain why
its movie ticket prices are among the lowest in the world. It
has a middle class of between 50 million to 100 million
people who can comfortably afford to pay much more than
the average ticket price of 150 to 250 rupees (US$2.25 to
$3.80). Government regulations keep prices in some regions
artificially low; in Tamil Nadu, prices have been fixed at a
maximum of 120 rupees (about US$1.80) for years, making
film production and exhibition there a risky proposition.
5. Taxes are too high. Unlike any other business in India,
movies must pay both an Entertainment Tax, which would
seem to classify them as a frivolous activity, outside the
ambit of a necessary service, and they must also pay Service
Tax, which implies they are necessary. Businesses in India
are normally taxed as either one or the other, entertainment
or service. But according to the tax collectors, Cinema is
somehow, inexplicably, both. India’s tax treatment puts the
cinema business in a financial chokehold.
6. Piracy is rampant, and government-supported. Every train
in India teems with hawkers selling illegal DVDs.
The Railway Police, who are supposed to apprehend
these pirates, will happily ignore them for a modest
bribe. The government owned internet service
provider, Bharat Sanchar Nigam Limited (BSNL),
which controls and sells all the bandwidth,
receives sizable data revenues from illegal movie
downloads. The BSNL website even promotes illegal
downloads, advertising how one can get free movies
on the internet. According to a 2013 article in WIPO
Magazine (the journal of the World Intellectual
Property Organization) the Indian film industry
loses around INR 18,000 crores (US$3.34 billion)
and some 60,000 jobs every year because of piracy
Research: The Annual Turnover Of
Indian Film Industry
Filmmaking is a big business, and being the largest in the world, Indian film industry
does rake in some really big numbers every year. With over 1000-1500 films
produced every year, Indian film industry is the biggest exporter of its culture
worldwide. But despite being the world’s largest film industry, it has the second
highest footfall into its cinemas (after China). Right now, the Indian film industry has
an annual revenue of around INR 138 Billion (13,800 Crores) that is predicted to
grow at a rate of 11.5% per year, reaching INR 238 Billion (23,800 Crores) in the
year 2020.
The Indian film industry is divided into many regional film industries that contribute
big and little to those big numbers. Lets have a look at the Top 5 Film Industries of
India and their numbers:
(1) Hindi Film Industry- Annual Turnover Statics
Also known as the Bollywood, Hindi film industry alone contributes a major 43% of
the total revenue. That makes it INR 5,934 Crore for the year 2015. The figure is to
reach INR 6,617 Crore by the year 2020.
(2) Malayalam Film Industry- Annual Turnover Statics
Witnessing a growth and stability, the Malayalam film industry is going strong each
year. Over 140 films were released during the year 2015 in Malayalam, making
over INR 500 Million at the box office over movie budgets of INR 120–150 million.
(3) Tamil Film Industry- Annual Turnover Statics
Tamil is the strong and largest regional industry after Hindi in India. It contributes
19% of the total annual revenue of Indian Film Industry, which means in the year
2015 it had a turnover of INR 2,622 Crores. By the year 2020, it is predicted to
reach INR 2,924 Crores.
(4) Kannada Film Industry- Annual Turnover Statics
With the smallest chunk in the pie, Kannada Film Industry is the smallest regional
industry in the south. According to sources in the Karnataka Film Chamber of
Commerce (KFCC), the annual turnover, which was in the range of INR 250-300
Crores till 2014, crossed INR 400 Crores in the year 2015.
(5) Bengali Film Industry- Annual Turnover Statics
Seeing a bump in the recent years, Tollywood is being slowed down due to poor
content and its audience’s preference towards English and Hindi content. Its annual
turnover in the year 2014 was INR 150 Crores, which is equivalent of a budget for a
star studded Hindi film. The condition is not looking good for the future too as the
industry struggles to find a hit that could save it from drowning.
Indian cinema
No. ofscreens 9,000 single screens (2016)
2,100 multiplex screens (2016)[1]
• Per capita 6 per million (2016)[2]
Produced feature films (2017)[3]
Total 1,986
Number of admissions (2016)[4][5]
Total 2,200,000,000
Gross box office
Total ₹156 billion (US$2.3 billion) (2017)[6]
National films India: US$2.1 billion (2015)
STATIA
India is home to a multi-million dollar film industry. It is the world’s largest producer of films,
ahead of Hollywood and its value can be calculated in a number of ways. The return on
investment a film generates is calculated by the number of times a movie earned over its
production and marketing cost. In India ‘Aashiqui 2’ a romantic musical drama released in
2013 as a sequel to the 1990 musical ‘Aashiqui’, generated 612 percent of the original cost
of the movie. This staggering amount of return on investment ranked ‘Aashiqui 2’ top of the
leading movies produced in India in 2013 by return on investment. Another film which
performed well in 2013 was the romantic comedy ‘Yeh Jawanni Hai Deewani’ which
generated 322 percent of the original cost.
Domestic box office is another way of measuring a film industry’s performance. Back in
2009, thedomestic box office revenue in India amounted to 65.8 billion rupees. It has been
estimated that by 2018 this revenue will have by almost grown to a staggering 160.2 billion
rupees.
Advertisers in India are aware of the industry’s popularity with audiences and have invested
heavily in cinema based advertising. In 2006, cinema advertising spending in
India amounted to 17 million U.S. dollars. It is a medium that advertisers are expected to
continue with so that by 2015 cinema advertising spending will reach an estimated 43
million U.S. dollars.
QUORA
Back in those days (early 2000's) Indian Film Industry was still very much in the
clutches of parallel financier's (Read: Mafia), and therefore, to create a composite data
was close to impossible. Not withstanding that, we still trotted along and presented a
fairly exhaustive case study of the Indian Entertainment Space.
Luckily, today the nefarious money is almost totally out of the Bollywood's system, and
therefore, data capturing is far more easier & streamlined, thanks in big measures to the
initiatives taken back in 2003-04 by IDBI (Industrial Development Bank of India) to
open up the Indian banking sector to Film Industry.
As of data available until 2014. Bollywood's (not including Television) 250 Censor
approved films generated a gross revenue of approximately, 600 Million equivalent
of USD, in revenue. The exports of these movies contributed to over 57% of that USD
600 Million
If these figures were to be further broken-down, Hollywood and international films
released in India, generated net box office revenues of $77 million in 2013-14:- Indian
films hit $1.23 billion reflecting a niche 8 percent market share. Within Indian film
revenues, Hindi cinema dominated the box office, grossing$565 million with the
cumulative total of all other regional-language films, pulling in $665 million (source:
PWC report for FICCI-FRAMES)
Further this industry (including Bollywood) is expected to grow 17% y-o-y in USD terms
and Bollywood alone is expected to bring in close USD 2 Billion in revenue by end of
this decade i.e Year 2020.
In comparison Hollywood movie's raked in excess of $31 Billion over the same time
period. Out of this $31 Billion, $11 Billion came from Domestic Ticket Sales (US only)
alone. U.S. filmed entertainment sector enjoyed a trade surplus of $14.3 billion in 2
While the entire Indian Film & Entertainment Industry including all Films (Hindi +
Regional), and Television is valued at USD 8.5 Billion, the U.S. media and
entertainment (M&E) industry is the world’s largest, and is expected to be valued at
$723 billion by 2018 – up from $598 billion in 2014.
As a marketplace, the United States is larger than Asia, Europe, Latin America, or the
Middle East-North Africa for media and entertainment1. The U.S. M&E industry is
concentrated on the two coasts: in the greater Los Angeles community, and in New York
City, with regional hubs for each sub-sector.
While Indian Film & Entertainment Industry contributes a meagre 0.5% of India's total
GDP of USD 1.877 trillion, the Hollywood led US Entertainment Industry Contributes
close to 4% of US's humungous GDP of $15 trillion.
While permanent/fixed employment data for Hollywood is readily available, 374,000
people employed in year 2010, down from 392,000 in 1998. Similar figures for
Bollywood are at the best estimation arrived from employment figures from Bollywood's
3 largest Production & Distribution Houses (YahRaj, UTV, EROS), which is close to
68,000 personnels employed on full-time or on temporary basis. Hollywood in
comparison boasts of 17 million employments on temporary or contractual basis.
In revenue terms Korean Industry with USD 1.8 Billion in Gross Revenue has a slender
edge over the Indian Film Industry, and way ahead of the Bollywood. But revenue apart,
it is the growth in Korean Film industries 7.6% y-o-y amongst International audiences
that should be disconcerting to Indian Cinephiles. Also the average Korean cinema
admissions per capita reached 4.19, one of the highest in the world. Korean film
industry records 215 million admissions in 2015
While Indian Cinema's reach overseas is pretty much restricted to the Indian diaspora
settled overseas, Korean films have been grabbing attention of cinephile across ethnic
spectrum, so much so that Spielbergs Dreamworks acquired rights of South Korean cult
Classic Tale of Two Sisters for $2 million
ECONOMIC TIMES
India is not yet a box-office goldmine for Hollywood; far from it actually — the market
share of Hollywood movies is still only 10%. Nonetheless, Hollywood studios consider
India an important market thanks to a growing audience for its movies and TV shows
(the top 10 Hollywood films of the 53 released in India in 2013 made a total of Rs 323
crore and the theatrical growth in India is estimated at 12% a year). Annoyingly for the
studios, not every fan watches movies legitimately. But the fight against piracy has lost
its sting becauseBollywood, which was once leading the fight, is now almost aloof after
many of its movies began making Rs 100 crore and more at the box office. That has left
the Motion Picture Association of America (MPAA), a body representing six Hollywood
studios, to almost single-handedly lobby for tougher laws on piracy in India. MPAA has
also been knocking on government doors to make it easier for Hollywood studios to
shoot movies in India. Frank Rittman, MPAA senior vice-president and deputy
managing director and regional policy officer, Asia- Pacific, a 25-year veteran in the field
of copyright in the music and film industry, says by enhancing its position as a shooting
destination, India would be boosting tourism and local economies. As for the fight
against piracy, Rittman, who doesn’t step out “at night chasing down the bad guys”,
prefers to educate people rather than clamp down on them. Edited excerpts from an
interview with Binoy Prabhakar.
How important a market is India for Hollywood movies?
It is a tremendously important market. By and large, Indian audiences prefer Indian
movies. But the country offers great growth potential. More and more [Hollywood]
studios are getting involved with local counterparts.
We hardly hear anything about piracy in India. Why is that?
It is actually a big concern. We have historically had a problem with camcording in the
region. As recently in 2012, India was leading the region in terms of what we call
forensic matches. When we go out to look for pirated DVDs, we could trace them back
to the theatres where they were recorded. That said, we view exhibitors as our partners
in this respect. The point of identifying perpetrators is that we can go back to the
theatres and say, ‘Hey, look, we got a problem here.’ We did have some targeted
investigations which resulted in pretty wellpublicized raids last year. India still ranks high
in terms of quantitative measurement in DVD piracy, internet piracy — you name it —
because of its [huge] population. But the concerns have migrated towards digital
technology and the number of users accessing internet for illegal downloads of movies.
