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Entertainment & Media – In this article you’ll find:
- How Entertainment & Media industry is reacting to post pandemic period and what forecasts tell us for the future
- Entertainment & Media – What could be the key drivers due even to the pandemic?
- Entertainment & Media – Important to know how advertising could grow behind the evolution of Entertainment & Media industry
- Entertainment & Media – Why streaming is becoming always more important and what we could expect by it
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Entertainment & Media
Important Consideration
- In 2022, the US$2.5tn Entertainment & Media global industry is expected to grow 7.3%, and it should notch a 4.6% CAGR through 2026.
- The growth is fed largely by digital.
- Moving towards the 2026 the US$2.9tn industry will be more digital, more mobile, more pitched at media that attract the young, more evenly distributed around the globe and more dependent on advertising in all its forms.
- Even the Advertising, which fell nearly 7% in 2020, grew a stunning 22.6% in 2021 – and represented 32.2% of total entertainment and media industry revenues.
- By 2026, PwC expect US internet advertising revenue to be only US$8.4bn short of total global non-digital advertising revenue.
- The US Entertainment & Media market is the largest market in the world. In 2020, Entertainment & Media revenues for the U.S. exceeded $500 billion and is projected to grow by a CAGR of about 6% through the end of the decade.
- Streaming is now at the top of every film industry executive’s distribution strategy. And competition is fierce. Today, there are more than 200 streaming services in the U.S. and no two are alike.
- By 2024, the firm estimates streaming revenues will reach $38 billion.
Entertainment & Media Pwc – Global Entertainment & Media Outlook
After falling 2.3% in 2020, total global entertainment and media (E&M) revenue rose a strong 10.4% in 2021, resuming its trend of outpacing global growth.
Entertainment & Media industries
As the world strives to move forward amid the continuing challenge of the COVID-19 pandemic, E&M industries are operating from new baselines.
The two big themes newly evident in our forecast are the increasing digitisation of E&M and the rising dominance of advertising.
Non digital advertising – Entertainment & Media
Over the five-year forecast period, global internet advertising revenue will expand at an impressive 9.1% CAGR to reach US$723.6bn in 2026, at which point 74% of revenue will be mobile.
Why is advertising growing so rapidly?
Global Entertainment & Media consumer base
Coming into view for 2026 is an avid global E&M consumer base that is younger, more digital and more into streaming and games than the current consumer population.
This customer base is also more involved in creating and shaping experiences for others.
Regional divides
Some of the largest fault lines in the world involve income and access to technology.
In 2021, 72.7% of households had fixed broadband internet access, and 60.7% of the population had mobile internet access.
That means there are still billions of people in the world who are not yet able to regularly access high-speed internet.
At a regional level, North America commands by far the highest E&M spend per capita, at US$2,229, nearly double Western Europe’s US$1,158.
By contrast, Asia-Pacific, which was the largest E&M region by revenue in 2021, has per capita spend of only US$224.
The Middle East and Africa have the lowest per capita E&M spend of any region globally, at US$82.
Entertainment & Media Tag Media & Entertainment Ecosystem report
E&M will continue to feel the economic pinch of the pandemic for some time. But the general outlook is quite positive.
According to PwC’s Perspectives from the Global Entertainment & Media Outlook 2020-2024, the worldwide M&E industry is expected to post a 2.8% compound annual growth rate (CAGR) through 2024.
Streaming – Entertainment & Media
With 75 million subscribers, Netflix leads the pack followed by Amazon Prime Video with 50 million subscribers, and Disney+ with 45 million subscribers.
The top 10 video streaming companies have a subscriber base of over 300 million viewers.
And on average, individuals subscribe to four streaming services in the U.S. and spend an estimated $47 per month.
Video Gaming
The U.S. is the second largest video gaming market in the world.
Estimated 150 million gamers generating $36.92 billion in annual revenues during 2020.
China, the largest video game market, has annual revenues of $40.85 billion and claims 660 million gamers (Statista, Feb 2021).
Some simple math shows that revenue per gamer should be much more lucrative in the U.S. In terms of gender, women represented 41% of all players in 2020 and men were 59% of the players.
My Conclusion – Entertainment & Media
As we look ahead to 2023 and beyond, the E&M industry will strive to maintain its balance in a landscape riven by fault lines and fractures.
But the overall growth path is both clear and strong.
Over time, the increasing availability of compelling E&M content, services and experiences will attract a greater share of consumers’ attention.
The data clearly shows that the mix of revenues and spending is changing rapidly.
Behavior consumers is changing in E&M industry and Streaming & Video gaming are poised to do well.
Given the expected increase in time spent in 3D experiences, we are likely to see greater investment in e-commerce in gaming environments and the metaverse.
Brands such as Nike and Gucci not only offering branded virtual items for purchase but also offering the opportunity to order physical goods.
Join the conversation with your own take on these topics in the comments below.
About the Author
Alessandro is a Financial Markets enthusiastic and he loves learning from articles/papers on many financial topics.
In doing so he shares with you the most interesting charts and comments.
Disclosure
This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument.
This material has been prepared for informational purposes only.
Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation.