The year 2009 was an annus horribilis for the media and entertainment business in India. The multiplex strike, lack of quality content, delay in auctions for phase 3 of FM radio and 3G mobile telecom licences were setbacks. The resounding success of 3 Idiots and Avatar and the third season of IPL (which saw substantial growth in advertising revenue for the broadcaster) proved to be the exceptions.
However, the industry is poised to bounce back with a strong double-digit growth (13 per cent) over the next five years with net revenues projected to double to Rs 1.09 lakh crore by 2014, according to a Confederation of Indian Industry-KPMG study.
Key drivers of growth
Digitisation: Newer platforms like digital cable, direct to home and Internet Protocol TV, digitisation of newspapers, magazines, films and sale of online music.
Regionalisation: Steady increase in literacy rates, consumption and disposable incomes in Tier 2 and Tier 3 cities.
Convergence: New media is bringing about a revolution by merging the functionalities of devices like TV, PCs and mobile phones.
TV and print are the largest sectors of the industry, which contribute more than 70 per cent of the revenues. Their dominance is expected to continue. Sectors like gaming and Internet have shown the highest growth rates due to the small base and the trend is expected to continue.