Bruised by the recession, the UK entertainment and media (E&M) market will experience a cumulative seven per cent decline in revenue from 2008 â€“ 2010 from $92 billion to $85 billion, a PricewaterhouseCoopers (PWC) report has suggested.
A decline in advertising and change in consumer spending behaviour will push the market to its lowest revenue figures since 2005. However from this point E&M will flourish with consumer spend driving an increase to $98 billion in 2013, ensuring the UK will be snapping at the heels of the market leaders, Germany, who will in turn experience an 8.6 per cent rise from 2010 to 2013 ($90 billion to $99 billion).
Phil Stokes, head of E&M at PWC, noted that E&M growth slowed to 1.5 per cent in the UK in 2008, with PWC expecting a cumulative 7.2 per cent decline over the next two years as the economy continues to struggle. “Although we expect a rebound beginning in 2010, Internet access, Internet advertising, TV subscriptions and licence fees, filmed entertainment and video games will be the only segments that will be larger in 2013 than in 2008,” he predicted.
Over the next five years, digital technologies will become increasingly widespread across all segments of E&M. However, companies are still struggling to adapt their current business models to ensure that they are monetising their digital content and capturing the revenues.
The UK Internet access market (wired and mobile) will increase at a compound annual growth rate (CAGR) of seven per cent from 2009 to 2013, an overall rise of 40 per cent ($10.3 billion to $14.4 billion spend).
Stokes explained, “Despite the recession, the rate with which we are becoming globally connected on a digital level has not eased up. We now expect constant and remote availability, and this new form of millennial 'electricity' must always be on, demanding a higher rate of Internet access across the UK. Growth in mobile access is allowing consumers to access the Internet from any location and is giving rise to popularity of high-end devices such as smartphones and iPods that combine mobility and access. Our anytime, any place, any device demands as consumers can be satisfied by businesses that listen to, understand and satisfy our individual needs â€“ and those that don't will pay the price,” he concluded.