Indian M&E Sector Experiences A Growth Of 19.9% In 2022, With INR 2.1 Tn Revenue: FICCI Report

The Indian Media and Entertainment sector continued its strong growth trajectory. It grew by INR348 billion (19.9 per cent) to reach INR2.1 trillion (USD 26.2 billion), 10 per cent above its pre-pandemic 2019 levels, according to the latest findings of the consulting firm, EY, stated in their recent publication.

While television remained the largest segment, digital media cemented its position as a strong number two segment, followed by a resurgent print. 

“It’s an exciting time to be in the M&E business, and it looks like it’s only going to get bigger and better as we expect the sector to grow 11.5 per cent in 2023 to reach INR 2.34 trillion and further grow at a CAGR of 10.5 per cent to reach INR 2.83 trillion by 2025,” said Jyoti Deshpande Chairman, FICCI Media and Entertainment Committee. 

Also, the filmed entertainment segment recovered as theatrical releases doubled, and reclaimed the fourth position overtaking online gaming. 

The share of traditional media (television, print, filmed entertainment, OOH, music, radio) stood at 58 per cent of M&E sector revenues in 2022, down from 71 per cent in 2019. Except for TV subscriptions, all M&E segments grew in 2022. 

Digital media grew the most at INR132 billion and consequently, increased its contribution to the M&E sector from 16 per cent in 2019 to 27 per cent in 2022. If one were to include data charges associated with digital consumption in sizing, its share would stand at 50 per cent of the total M&E sector.

According to Ashish Pherwani M&E Sector Leader Ernst & Young LLP, “The diverse consumer base, coupled with favorable macroeconomic and demographic factors, has translated into a very exciting time for the industry. India’s M&E sector achieved its highest-ever revenues in 2022. Almost every segment grew, across both traditional and new media.”

Experiential (outside the home) segments recovered in 2022, and consequently, filmed entertainment and live events segments recovered by INR79 and INR41 billion, respectively. 

Overall, half the growth was driven by traditional media, and the balance by digital, online gaming and VFX segments. 

Ex-chair of the FICCI M&E committee, Sanjay Gupta commented, “As India reaffirms its place in the global order on the mantle of the G20, the M&E sector also has the unique privilege to contribute to India’s growing global soft power. A fresh look at the tyranny of the old established business models will ready our sector to take the next leap forward.” 

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According to report, in 2022, when India’s nominal GDP grew 15 per cent, advertising recovered 19 per cent. Advertising is usually around 2x to 2.5x of real GDP growth, which is expected to be 7 per cent for FY20231.    

However, when GDP is impacted, the discretionary nature of the M&E sector results in a disproportionately higher contraction, as was seen in 2020. At INR1,049 billion, advertising exceeded the INR1 trillion benchmark for the first time. It is now 0.4 per cent of India’s GDP2, much lower than developed large markets like the US, Japan and China, which are all between 0.6 per cent and 1 per cent. 

As per GroupM’s TYNY report 2023, India was ranked 8th by global ad spend and will continue as the fastest growing market among the top 10 ad markets in 2023. 

Television: 

Television advertising grew 2 per cent to end 2022 just behind its 2019 levels, on the back of volume growth. Subscription revenue continued to fall for the third year in a row, experiencing a 4 per cent de-growth due to a reduction of five million pay-TV homes and stagnant consumer-end ARPUs. While linear viewership declined 7 per cent over 2021, 8 to 10 million smart TVs connected to the internet each day, up from around 5 million in 2021. 

Digital advertising:

Digital advertising grew 30 per cent to reach INR499 billion, or 48 per cent of total advertising revenues. Included in this is advertising by SME and long-tail advertisers of INR180 billion and advertising earned by e-commerce platforms of INR70 billion. 

Film:

The segment grew 85 per cent to reach 90 per cent of its 2019 levels as theatres  re-opened. Over 1,600 films were released in 2022, theatrical revenues crossed INR100 billion, and fewer films released directly on digital platforms. 335 Indian films were released overseas. 

OOH:

OOH media grew 86 per cent in 2022 and reached 94 per cent of 2019 levels. Capacity utilisation improved in 2022, but rates remained challenging. Digital OOH screens increased to around 100,000 and contributed 8 per cent of total segment revenues.