The Hindu : Business : Entertainment industry poised for growth

Online edition of India's National Newspaper
Monday, Apr 04, 2005

Business

Business

Entertainment industry poised for growth

The entertainment industry, fuelled by higher and growing levels of consumer spending, is poised to unfold a host of value added features for consumers and players.

THE INDIAN entertainment industry now estimated at over Rs. 20,000 crores ($4.5 billion) is expected to grow in high double digits at 18 per cent compounded annually over the next five years to reach over Rs. 45,000 crores ($10 billion by 2009), according to a FICCI-PricewaterhouseCoopers study. The largest contributor to this growth will be the television segment followed closely by the film segment.

The study says that the entertainment industry, fuelled by higher and growing levels of consumer spending, especially on leisure and changing lifestyles, coupled with the force of high technology, is poised to unfold a whole host of value added features for the consumers and new streams for the players in each segment of the industry.

In the new converged paradigm, the technological boundaries of the entertainment industry will be merged with those of the telecommunications and information technology segments and mobile entertainment, with its ability to dissect boundaries of time and space, will be the biggest growth driver.

Television

The future of the television industry is digitisation and it is only a matter of time before market forces propel the industry towards that. Resolution of current challenges of distribution and digitisation will also define the content formats and the viewership patterns of consumers in future.

The study says that digitisation will revolutionise the film industry by bringing out faster and cheaper modes of delivering films. These will be in terms of digital distribution of films, emergence of home video market entailing shorter release windows and new distribution formats such as Internet and mobile devices.

Content is and will continue to be the king of entertainment in future and securing rights over the content will decide the strength of the players across all segments. The challenge will then be of having a regulatory regime working towards adapting to these advancements.

Digital cinemas

Though piracy continues to dampen growth, measures taken by some companies to go digital and the increase in the number of digital cinemas are helping reduce its extent.

The emergence of professionally run international companies, distributing domestically produced movies, has also contributed towards increase in legitimate revenues of the film producers.

A similar growth is projected for the Indian music industry, which is riding on the boom of remixes and video albums. Digital delivery formats, wireless mobile phones and Internet will be the emerging platforms and will bite into the traditional formats of CDs and cassettes.

Radio

The radio industry is also set to boom, says the study. Availability of larger number of frequencies is expected to drive the segment by 22 per cent over the next five years. The present market is still untapped to a large extent and with rationalisation in the licence framework; the segment is expected to almost treble its size to about Rs. 650 crores by 2009. The boost provided by the television segment and corporatisation of the entertainment segment is expected to drive the segment growth at 18 per cent over the next five years.

Ramnath Subbu
in Mumbai

Printer friendly page
Send this article to Friends by E-Mail

Business

News Update

Stories in this Section

Gradualism over foreign equity in banks

Towards a balanced energy policy

Banks consolidation: only theoretical gains

Entertainment industry poised for growth

Changes in tax deduction at source obligations