Entertainment & Media Revenues rebounding strongly; shift to gaming and user-generated content is transforming industry: PwC
13 July 2021: Global Entertainment & Media (E&M) industry has regained its momentum, with revenues outpacing the economy as a whole. The $2+ trillion industry is on track to grow 6.5% in 2021 and 6.7% in 2022, fuelled by strong demand for digital content and advertising. The renewed growth follows a challenging 2020, when in-person entertainment plummeted, including a 71% decline in movie theatre box office revenues. These figures come from PwC’s Global Entertainment & Media Outlook 2021-2025.
# 3.8% decline in global E&M revenue, from US$2.1trn in 2019 to US$2.0trn in 2020, was the biggest year-on-year drop in the Outlook’s 22 years.
# From 2021 to 2025, we project global E&M revenue to grow at a healthy compound annual growth rate (CAGR) of 5.0%, taking industry revenues to US$2.6trn in 2025.
# Traditional TV/home video remains the largest E&M consumer segment (US$219.0bn) but will continue to shrink (-1.2% CAGR) over the next five years.
# Video streaming boomed in 2020 and its growth trajectory will continue. Streaming video-on-demand (SVOD) is projected to grow at a CAGR of 10.6% to 2025, making it an US$81.3bn industry.
# Video game and esports revenues continue their rapid ascent, reaching US$147.7bn in 2020, with a 5.7% CAGR projected to expand the segment to become an almost US$200bn business (US$194.4bn) by 2025.
# Virtual reality (VR) is the fastest-growing E&M segment, albeit from a small base. Its revenues surged by 31.7% in 2020 to US$1.8bn and are projected to sustain a CAGR of 30%+ over the next five years to reach US$6.9bn business in 2025.
# Music is poised for robust growth following a massive 74.4% slump in live music revenues in 2020. We expect total music revenues to grow at a 12.8% CAGR over the next five years.
# Spending on internet advertising rose by 9% to US$336bn in 2020, overtaking non-internet ad spending for the first time, and is projected for strong growth of 7.7% CAGR over the next five years.
# Internet access accounted for 34% of E&M spending in 2020 and will increase at a 4.9% CAGR, from 2020’s US$694bn to US$880bn in 2025. Mobile internet access will drive market growth, with revenues rising at a 6.1% CAGR from US$449bn in 2020 to US$605bn in 2025.
Werner Ballhaus, Global Entertainment & Media Industry Leader Partner, PwC Germany, said “The pandemic slowed the entertainment and media industry last year, but it also accelerated and amplified power shifts that were already transforming the industry. Whether it’s box office revenues shifting to streaming platforms, content moving to mobile devices, or the increasingly complex relationships among content creators, producers and distributors, the dynamics and power within the industry continue to shift.”
www.pwc.com
