2019 Global E M Outlook

Global Entertainment & Media
Outlook: 2019-2023
Contents
1
Perspectives from the 2019 Outlook 04
2
Overview – Global E&M macro trends 07
3
Segment review – Spotlight on India 12
4
Q&A
PwC | Global Entertainment & Media Outlook 2

Perspectives from
the 2019 Outlook
2019 Outlook perspectives
Getting personal: Putting the me in entertainment and media
Global Entertainment & Media Outlook perspectives
• The rise of increasingly personal and personalized

media interactions, as today’s consumers—eager,
highly selective, and voracious—seize the
opportunity to enjoy media experiences uniquely
tailored to their own preferences, contexts, and
schedules
• Consumers are using an expanded array of

connected devices to organize, curate and
discover their own unique world of media. In
response, companies are tailoring their offerings to
revolve around personal preferences, using data and
usage patterns to pitch their products not at
audiences of billions, but separately at billions of
individuals
• The increasingly individualized world brings major

implications for every E&M business across every
segment

The rise of instant gratification: Need to engage consumers in

the moment, meet them where they are
Customers are increasingly preferring to construct their own media menus and
consume content at their own pace.
Meet consumers where they spend time…
In voice, voice- Online, shoppable ads

commerce ( V-
commerce)
Shifting behaviors are
forcing content
creators and In games, marketing On social media,
distributors to devise on esports and gaming influencers and social
new ways of engaging media ads
with consumers
On audio, audio On OTT, blending OTT
streaming service and e-commerce
providers

The value of personal data is rising as we are entering an era of

increasing personalized content
Trust has become a central theme in this age of personalisation
Boosting the value of

AI is on the rise
personal data
VR/Cloud Gaming and

4G is impacting across TMT
similar other business -
value chain
introduction of 5G

Overview – Global
E&M macro trends
Global summary and macro trends

Global trends shaping the E&M market : seven key trends
1 In 2018, mobile Internet advertising revenue outweighed its wired equivalent for the first time
2 Mobile video Internet advertising is becoming increasingly important vs. total wired display
3 Mobile soars, with smartphone data consumption overtaking that of fixed broadband in 2020
4 By 2023, marketers will allocate more than 50% of their budgets to digital advertising
5 Over the next five years, China's absolute growth will exceed that of the US for the first time
6 China will overtake the US to become the world’s largest smart speakers market by 2021
7 Asia Pacific will overtake North America as the largest OTT region by 2021
Source: PwC Global Entertainment & Media Outlook 2019-2023, www.pwc.com/outlook

The Global E&M market to reach US$2.6trn by 2023, Digital

to account for a larger share of the industry’s income
Global E&M revenue and nominal growth forecast for next 5 years*
3.00
2.6
2.5
2.50 2.4
2.3
2.2
2.1
2.0
Revenue $tr USD
2.00 1.9
1.8
1.7
1.50
1.00
60.3% 61.3%
57.3% 58.9%
53.1% 55.4%
0.50 47% 50.5%
40.7% 43.9%
0.00
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Digital revenue as % of total revenue
Reaching over
60% in 2022
Note: All figures are reported in nominal terms reflecting actual spending transactions and therefore include the effects of inflation
In terms of individual segment market size as % of global E&M

revenue, Internet advertising will see the largest gain
Share of E&M revenue by segment: 2018 vs. 2023
Global India
Segment 2018 actual 2023 forecast 2018 actual 2023 forecast
Internet Advertising 12.3% 15.8% 3.1% 4.1%
TV and Video 11.6% 9.1% 26.6% 27.3%
B2B 8.9% 8.3% 3.3% 2.7%
Newspapers and consumer
8.5% 6.2% 10.6% 7.2%
magazines
TV Advertising 7.5% 6.6% 10.6% 10.3%
Books 5.6% 4.8% 14.0% 10.0%
Video games and esports 5.4% 6.0% 2.8% 4.0%
Music, radio and podcasts 4.6% 4.3% 2.2% 2.4%
Cinema 2.0% 2.1% 4.5% 3.9%
OOH 1.8% 1.7% 1.2% 1.0%
OTT Video 1.7% 2.7% 1.7% 2.7%
VR 0.1% 0.2% - -
Note: The above table does not include Internet access data. 2018 is the latest available data. 2019-2023 values are forecast projections
Segment overview: India v/s Global summary
All segments in India are growing faster than Global; OTT

video to be the fastest growing at ~22% CAGR through 2023
Segment wise Growth rate (%) CAGR 2018 - 2023
VR 22.2
OTT 21.82
13.8
Internet advertising 17.75
9.5
Video games and e-sports 18.89
6.5
Internet access 16.02
5.9
Cinema 8.51
4.4
Out-of-home 8.09
3.3
Music, radio and podcasts 13.54 Unlike in India,
3.2
6.93 Traditional TV and
Business-to-business 2.7 home video globally is
TV advertising 10.71 showing negative
1.5
growth for the first time
Books 4.18
1.2
Traditional TV and home video 11.83
(0.7)
Newspaper and consumer magazines 3.1 India Global
(2.3)
-5 0 5 10 15 20 25
2018-2023 CAGR %
Note: 2018 is the latest available data. 2019-2023 values are forecast projections
Segment review –
Spotlight on India
India: Summary
India to remain the fastest growing territory, surging at a CAGR

of 11.28% to reach US$64 Billion by 2023
Overall sector vs Top 4 segments in terms of CAGR %

Key highlights - India
(excludes internet access)
• India’s OTT segment set for rapid growth as

Overall E&M sector in India 11.3%
North America, the world’s biggest OTT market
becomes increasingly mature
OTT video 21.8% • India to move into the top ten global gaming
markets by consumer revenue by 2023.
• Backed by a rapid growth in Internet and

Video games and esports 18.9%
smartphone penetration, India is set to be the
second fastest growing internet advertising
market after Indonesia.
Internet advertising 17.8%
• India’s music, radio and podcasts market is ripe
for growth. The growing adoption of
smartphones and smart speakers will make all
Music, radio and podcasts 13.5%
forms of audio increasingly accessible to
listeners in the coming years.
Revenue growth (2018-23 % CAGR)

Deep dive: OTT video
India’s OTT video market will nearly triple in size and surpass
South Korea to become the eighth-biggest market by 2023
OTT video segment revenue 2014-2023 (US$ Bn) Regional 2018 revenue and growth: historical vs. forecast
Global India 26%
72.8 1.7 24%
2018-2023 CAGR
22% INDIA
20%
45.2
38.2 18% APAC
0.8 16% LATIN
0.6 NORTH AMERICA
14%
12% AMERICA
10% UK EMEA
2018 2019E 2023
8%
2018 2019E 2023
0% 15% 30% 45% 60% 75%
Subscription VOD vs transaction VOD 2014-2018 CAGR
(% share of overall OTT market)
Global India
100% 100% • Improving data affordability and
20% 19% 15% 16% 14% 11% accessibility has made India an attractive
80% 80%
destination for international players.
60% 60%
• Backed by attractive subscription rates,
40% 80% 81% 85% 40% 84% 86% 89%
localized content and bundled packages,
20% 20% Subscription video on demand (SVOD)
0% 0% witnessed a 64% YoY growth in 2018.
• This segment is further expected to grow
at a 23.3% CAGR from US$537mn in
Subscription VOD Transactional VOD
2018 to US$1.5bn in 2023.
Deep dive: OTT video
While OTT video market is rapidly growing in significance, TV

subscription will remain by far the biggest market in India.
TV subscription, OTT, cinema: % revenue share of Video content revenue growth % CAGR 2018-2023: India
combined video content segment)
2014 1% 19% 80%
OTT 21.8%
2018 5% 14% 81%
India
2023 8% 12% 81%
TV subscription 11.9%
2014 5% 8% 87%
US 2018 11% 9% 79%
Cinema 8.5%
2023 20% 10% 70%
OTT Cinema TV subscription
• In India, cord cutting is not happening as • The rise of OTT services has galvanised
much as it is in the US operators into launching premium
• Growth in OTT video will continue to products and enticements such as Ultra
outstrip the growth rate of TV subscription HD, 4K, video-on-demand services and
and cinema, as major players such Netflix next-generation set-top boxes.
and Amazon set sights on India for their
next cycle of subscriber growth.

Deep dive: Internet advertising
Internet advertising continues to grow as media players and

advertisers shift greater attention to online distribution
Internet advertising revenues vs other advertising revenues, 2014 vs. 2023 (% share)
2014 Global 2023
Internet
advertising • Total Internet advertising revenue for
27.0% Other
Internet India in 2018 was US$1.2bn,
advertising
advertising
Other 45.3%
54.7% expected to reach US$2.6bn by 2023.
advertising
73.0% • While in India, Internet advertising
happens to be the fastest growing ad
India segments, TV advertising will still hold
the largest share of ad revenues
Internet Internet throughout the Outlook period.
advertising advertising
11.0% 22% • India’s TV advertising will become the
Other
advertising world’s top TV advertising markets
Other 78% overtaking the UK, Germany, France
advertising
89.0% and Brazil during this period.
Note: 2018 is the latest available data. 2019-2023 values are forecast projections
Deep dive: music, radio and podcasts
Music, radio and podcasts an “emerging” segment in India; to

surpass US$1.5 Billion by 2023
Music, radio and podcasts segment revenue Sub-segment wise revenue (US$ Mn): India
2014-2023: Global vs India 2018-23
CAGR
800 11.5%
2 700 13.8%
117
Revenue $bn USD
Revenue $bn USD
1.6
100 600
100 87
80 500
60 1 0.8 400
0.6 Digital music streaming
40 300
CAGR = 24.27%
20
200
0 0
2014 2018 2023 100 58.9%
2014 2018 2023
Global India 0
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Radio Music Podcast Advertising
• With streaming services finally germinating, music to be a fast growing segment at a 13.8%
CAGR, to hit US$0.7bn by 2023.
• According to the International Federation of the Phonographic Industry (IFPI), 96% of
smartphone users in India are using their devices to listen to music, highest rate in the
world. This figure climbs to 99% for 16–24-year-olds.
• Ease of voice search coupled with increasing penetration of smart speakers will further drive
revenues over the next 5 years.
Note: * defined as people who listened to at least one podcast in the last month
Deep dive: video games and esports
By 2023, App-based social/casual gaming to account for 85%

of India’s US$2.5 Billion video games & esports market
% Share of sub-segment revenue: Global vs. India Video game consumer revenue (US$ Mn): India
Global India
<1% <1%
100% 4% 4% 100% 4% 3% 2,500 US$2.1 Bn
US$ Mn
80% 80% 2,000
52% 53%
60% 60% 70% 1,500
85%
40% 40% 1,000
20% 44% 42% 20% 500 US$0.3 Bn
25%
12%
0% 0% 0
2018 2023 2018 2023 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
E-sports
Game Advertising
Social/ casual games
Traditional gaming Social/ Casual Traditional
• The growth in social/casual gaming is • Data usage is expected to rise from

attributable to app-based gaming, as 1.4GB for each active phone a month in
browser-based games continue their 2016 to 7GB by 2021.
decline. • India’s esports segment is small at
• Growth will continue for the category as present. However, improving online
the smartphone user base expands. infrastructure and rising sponsorships
may provide impetus for growth.
Thank you.
Thank you
pwc.com/outlook
pwc.com/outlook
© 2019 PwC. All rights reserved. PwC refers to the US member firm or one of its subsidiaries or affiliates, and may sometimes refer to the PwC network. Each member
firm is a separate legal entity. Please see www.pwc.com/structure for further details.

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Global Entertainment & Media

PwC | Global Entertainment & Media Outlook 2

Getting personal: Putting the me in entertainment and media

Global Entertainment & Media Outlook perspectives

• The rise of increasingly personal and personalized

• Consumers are using an expanded array of

• The increasingly individualized world brings major

PwC | Global Entertainment & Media Outlook 4

The rise of instant gratification: Need to engage consumers in

Meet consumers where they spend time…

In voice, voice- Online, shoppable ads

PwC | Global Entertainment & Media Outlook 5

The value of personal data is rising as we are entering an era of

Boosting the value of

VR/Cloud Gaming and

PwC | Global Entertainment & Media Outlook 6

Global summary and macro trends

Global trends shaping the E&M market : seven key trends

Source: PwC Global Entertainment & Media Outlook 2019-2023, www.pwc.com/outlook

The Global E&M market to reach US$2.6trn by 2023, Digital

Digital revenue as % of total revenue

In terms of individual segment market size as % of global E&M

All segments in India are growing faster than Global; OTT

India to remain the fastest growing territory, surging at a CAGR

Overall sector vs Top 4 segments in terms of CAGR %

• India’s OTT segment set for rapid growth as

• Backed by a rapid growth in Internet and

PwC | Global Entertainment & Media Outlook 13

While OTT video market is rapidly growing in significance, TV

Source: PwC Global Entertainment & Media Outlook 2019-2023, www.pwc.com/outlook

Internet advertising continues to grow as media players and

2014 Global 2023

Music, radio and podcasts an “emerging” segment in India; to

By 2023, App-based social/casual gaming to account for 85%

• The growth in social/casual gaming is • Data usage is expected to rise from

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