Indian Biz Grows 12 per cent to $14.8 billion in 2011: Report
MUMBAI – The Indian media and entertainment business registered a growth of 12 per cent over 2010, to reach $14.8 billion (Rupees 728 billon) according to an annual report by FICCI (Federation of Indian Chambers of Commerce and Industry) and consultants KPMG India. The report is released ahead of the annual FICCI FRAMES industry conference which takes place from 14-16 March in Mumbai.
Overall, the industry is expected to register a CAGR (Compounded Annual Growth Rate) of 15 per cent to touch about $29.7 billion (Rupees 1,457 billion) by 2016. The growth trajectory is backed by strong consumption in smaller cities and towns, continued growth of regional media, and fast increasing new media businesses.
“2011 has been a challenging year not just for the Indian industry, or even the Indian economy, but for the larger world economy. While India is still expected to grow at a healthy pace, growth is projected to be lower than earlier expectations,” the report said.
As in years past, the television business continues to dominate with the industry estimated at Rupees 329 billion in 2011 which is expected to grow at a CAGR of 17 percent over 2011-16, to reach Rs 735 billion in 2016.
The film business is expected to sustain the momentum of 2011 which saw some titles crossing the Rupees 1 billion box office mark. The report estimates the film business at Rs 93 billion in 2011, a growth of 11.5 percent over 2010, projected to grow at a CAGR of 10.1 percent to touch Rs 150 billion in 2016.
“2011 was clearly the year where digital technologies began to deliver on their promise. Digital film distribution has helped wider film releases and helped control costs. In television, the digitisation of cable will transform business models of all stakeholders and offer consumers more choice and convenience. Even as digital generates new opportunities, it also brings with it challenges that the industry must solve more urgently than anticipated,” said FICCI Entertainment Commitee chairman and veteran film-maker Yash Chopra who also heads one of Indian filmdom's most successful banners, Yash Raj Films.
The music industry touched Rupees 9 billion in 2011, a modest five percent growth over 2010, but the report notes that increasing digital platforms replacing physical formats will continue to fuel growth.
Ad spends across all media accounted for Rs 300 billion in 2011, representing 41 percent of the overall media and entertainment industry revenues. Advertising revenues witnessed a growth of 13 percent in 2011 compared to 17 percent in 2010.
“The media and entertainment industry landscape is undergoing a significant shift. Cable digitisation, the promise of wireless broadband, increasing DTH penetration, digitisation of film distribution, growing Internet use are all prompting strategic shifts in the way companies work. Traditional business models are evolving for the better as a host of new opportunities emerge,” said KPMG India head of media and entertainment Jehil Thakkar.