The global entertainment & media (E&M) industry has regained its momentum, with revenues outpacing the economy as a whole, according to advisory firm PwC’s Global Entertainment & Media Outlook 2021-2025.
The $2+ trillion (€1.6tn) industry is on track to grow 6.5 per cent in 2021 and 6.7 per cent in 2022, fuelled by strong demand for digital content and advertising. The renewed growth follows a challenging 2020, when in-person entertainment plummeted, including a 71 per cent decline in movie theatre box office revenues.
Other findings in this year’s Outlook include:
“The pandemic slowed the entertainment and media industry last year, but it also accelerated and amplified power shifts that were already transforming the industry,” advises Werner Ballhaus, Global Entertainment & Media Industry Leader Partner, PwC Germany. “Whether it’s box office revenues shifting to streaming platforms, content moving to mobile devices, or the increasingly complex relationships among content creators, producers and distributors, the dynamics and power within the industry continue to shift. Our Outlook shows that the hunger for content, continued advances in technology and new business models and ways of creating value will drive the industry’s growth for the next five years and beyond.”
Generational shift: youth will be served
Not surprisingly, many younger consumers have little awareness of, or interest in, traditional media. On the other hand, media platforms designed for young consumers or that enable lightly-produced, authentic content have boomed. Gaming is central to the youth movement and is becoming a significant driver of data consumption – in fact it is on pace to be the fastest-growing content category in that regard, accounting for 6.1 per cent of total data consumption globally by 2025, up from 4.7 per cent in 2020.
Regulatory shifts: pushback on platforms
The regulatory scrutiny of big tech is yet another shift impacting E&M. Antitrust pressures have increased with calls to break up big tech platforms along with government proposals for new media regulations. Changes to current regulatory regimes are inevitable and it’s vital that E&M players incorporate regulatory risks in their planning processes.
“Even in the areas that offer the most compelling top-line growth – like video streaming – the nature of competition is likely to change dramatically over the coming years,” predicts Ballhaus. “And all the while, the social, political, and regulatory context in which all companies operate continues to evolve in unpredictable ways. All of which means that sitting still, relying on the strategies that created value and locked up market share in the past, will not be the most effective posture going forward.”