The Media & Entertainment industry holds immense power to influence, shape and transform society. However, these are interesting times, with the industry itself witnessing massive transformation. The last few years have been nothing short of a rollercoaster for all of us. A few quarters of struggle, with difficulties in producing content, closure of cinema halls and a cut-back in advertising spends during the pandemic, were followed by a cycle of strong revival. That the industry is today performing better than pre-pandemic levels is reflective of its agility and its readiness to embrace challenges.
Industry needs to constantly keep pace with the changing environment. Else, there is a risk of becoming irrelevant. Disruptive innovation is happening at a staggering rate. Consumers, technology and consumption behavior are constantly changing. We have to keep challenging the status quo and question our own, old successful formulas.
Opportunities in Media & Entertainment
As a country, we should be ready to address all future challenges, and seize the opportunities that our sector offers, to make India the creative hub of the world.
The Media & Entertainment sector remains underpenetrated and accounts for less than 0.9% of GDP, compared to 3 to 4% for many of the developed countries. Also, both subscription and ad revenues in India are much below global levels.
If we look at some of our sub segments – in a country with 300 million households, 100 million households are still without a television set, which provides enough headroom for growth. Broadcasting industry being a powerful medium can educate, inspire and empower viewers. It is thus pertinent that the Government and industry come together to provide television access to all households in India.
Streaming is a fast-growing sector in India. Low data prices, wireless broadband, and smartphone penetration have been catalysts to this phenomenal growth. This segment is expected to continue witnessing strong double-digit growth. It is also important to mention here that the rollout of 5G services will provide a further boost. Light touch regulation is critical for continued innovation and investment in streaming businesses.
The Animation, Visual Effects, Gaming and Comics (AVGC) sector is a USD 800 billion industry globally. Yet, even with the huge talent force available in the country, we do not even have one percent share. This can be another IT-like sector, and we can definitely target a 5% market share in 5 years’ time. That is close to a USD 40 billion opportunity and with a potential to create 160,000 jobs.
There is a lot of focus coming with the AVGC taskforce and setting up of a National Center of Excellence. However, the opportunity is substantial, and we should evaluate how we can really fast track this and take advantage of this big and fast-growing sector.
Gaming is another high growth segment, with skill-based gaming as an important contributor. However, there is a lot of ambiguity around it and lack of clarity on gaming and gambling. Some states are even disallowing genuine gaming operations. Globally, gaming is estimated to be a USD 230 billion industry and here too, our market share is less than one percent. Bringing regulatory clarity at national level, therefore, is important for growth of this segment.
Sports in India is still at a nascent level. We have recently seen billions of dollars being committed to sports’ rights. The policy makers and regulators should provide a robust environment for continuous investments that can transform India into a sporting nation. The regulator should leave price discovery for distribution to market mechanism. Investments in indigenous sports like Kabaddi will encourage adoption of sports all over India including in villages.
With beautiful and diverse locations and landscapes, good infrastructure, high quality manpower, we have all the ingredients required to tap this opportunity and to become the preferred destination for international film shoots. While incentives have been announced, single window clearance and focused global marketing are required for this to be successful. We need a dedicated taskforce or study to provide end-to-end recommendations, on making ‘Destination India, easy and attractive for global producers. And we also need to make dedicated efforts to market this to realize the export potential from this opportunity.
Reaching out to a Global Audience
There is a big opportunity in taking Indian content to global audiences. South Korea has set a great example in demonstrating repeatedly that good content travels beyond boundaries and language barriers. Despite having a strong ecosystem of talent, production efficiencies and creative capabilities, we have not been able to make a mark on the global stage. This is an area where the industry needs to come together, explore, and create content that can travel and become storytellers to the world.
The movie segment is passing through a challenging time. While regional movies have done relatively better, it is time for the industry to think boldly and redefine their approach. It is time for Bollywood to take a serious look at the recent box office failures and redefine its strategy to attract both local and global audiences. Some of the recent regional movies have been very successful both in India and on global streaming platforms and it is validation that we have the potential to take our movies to global audiences. It is time for the industry to work towards this goal.
News, print-media, music and radio continue to be important contributors to our industry and are undergoing massive changes. It is time for these sectors to understand the changing consumer habits and reinvent themselves with a digital approach.
The article was contributed by Mr K Madhavan, Chairman, CII National Committee on Media & Entertainment and Country Manager & President, Disney Star, and was first published in the December edition of the CII Communique.