Print struggles as digital dominates entertainment and mediaFollow @PwC_Scotland
The UK entertainment and media (E&M) market will be worth £63 billion a year by 2016, according to the latest Global Entertainment & Media Outlook 2012-2016, from business advisors, PwC.
PwC says the industry already generates sales of over £54 billion annually and is now the second largest market in Europe. The Global Entertainment & Media Outlook expects the industry to grow well ahead of inflation over the next number of years.
However, the Outlook warns that newspapers and print are being eclipsed by tablets, mobile smart devices and a raft of new digital and online communications media, led by internet and television advertising and video games.
The publication comes out days after a pledge by Government to invest a further £32 million to ensure Scotland’s superfast broadband investment is on track across rural and suburban areas, a move that will benefit households and businesses and brings the total investment to £100 million.
As part of this programme, Edinburgh will also become a super-connected city with ultrafast broadband, one of 10 in the UK, which will positively impact film, music, life science, technology and gaming sectors in the city.
PwC research confirms that digital product and delivery is now embedded in the heart of many media companies and presents the greatest growth opportunity in the immediate future.
Phil Stokes, entertainment and media partner at PwC says that, despite the economic uncertainty, global sales of tablets and smart devices are at record levels, underlining the revenue opportunities from digital delivery of E&M content and advertising to increasingly connected and mobile, consumers:
“The various segments of the E&M sector are at different stages of digital development, but in all cases, digital is now embedded in day-to-day business.
“Consumers are demanding digital content for on-demand entertainment, education and information on mobile devices and companies have moved past initial experimentation and are now delivering this as a new normal.
“E&M companies have made the commitment to a digital future, and are now striving to make the necessary changes to their products, distribution and organisations to deliver sustainable – and profitable – growth.”
This is PwC’s 13th annual Global Entertainment and Media Outlook, containing in-depth analysis and historical and forecast data for advertising and consumer/end-user spending in 13 major industry segments, across 48 countries.
Some of the key forecasts for the period 2012–2016 include:
- Internet advertising in the UK is set for annual double digit growth of around 12% and should almost double from £4.96bn in 2011 to £8.75 billion by 2016, accounting for almost half of the UK’s total advertising market in 2016.
- Television, including broadcast and online/mobile TV will grow at 2.2% annually to £4.1 billion, with subscription TV being worth £6.8 billion by 2016.
- The UK’s £2.4bn annual video game market is Europe’s largest and should growth annually by 4.4% to £3 billion in 2016.
- Newspapers represented a significant £5.7bn market in 2011, despite a fall of 8%. Continued declines in print circulation and print advertising will lead to a 1.6% compound annual decrease during the next five years, falling to £5.25 billion in 2016.
The E&M Outlook says three behavioural changes are driving global shifts in industry structure and value:
From print to digital: electronic books’ share of total global spending on consumer and educational books will rise from 5% in 2011 to 18% by 2016.
From fixed to mobile consumption: Global mobile internet access increased from 26% of total internet access spending in 2007 to 40% in 2011 – and will grow to 46% by 2016.
From West to East, and North to South: Total revenue growth to 2016 in Central and Eastern Europe/Asia Pacific will be almost double that of North America/Western Europe. And growth in the southern Latin America/Middle East/Africa market will average more than twice that of North America/Europe by 2016.
Phil Stokes, lead entertainment and media partner at PwC, said:
“The new world is hugely more complicated than the old world and companies have to work harder and faster to stay relevant to consumers.
“However, as digital becomes a fully-established within companies and the services they offer to consumers, its rising penetration ceases to be a topic for discussion in itself.
“What matters now is how companies capitalise on it and operate within it.”
Notes for editors.
About the Outlook
PwC’s Global Entertainment and Media Outlook 2012-2016, is available to download at http://www.pwc.com/outlook.
The Outlook covers Business-to-business, Consumer and educational books, Consumer magazine publishing, Filmed entertainment, Internet access spending: wired and mobile, Internet advertising: wired and mobile, Newspaper publishing, Out-of-home advertising, Radio, Music, Television advertising, TV Subscriptions and license fees, Video games.
Email: Lynn Hunter
Tel: +44 (0)141 355 4015