The global entertainment and media industry has rebounded strongly from a pandemic crisis, according to a new report.
According to PWC, the sector is expected to grow 6.5% in 2021 and 6.7% in 2022. The report notes that the sector’s revenues are expected to overtake the economy as a whole, fueled by strong demand for digital content and advertising.
This growth is expected to follow a 2020 in which in-person entertainment suffered, including a 71% drop in box office revenue from the cinema. Overall, the 3.8% decline in global E&M revenue, from US $ 2.1 trillion in 2019 to US $ 2.0 trillion in 2020, was the largest drop in a year on the other in more than 22 years.
Between 2021-25, the research firm predicts that global E&M revenue will grow at a CAGR of 5% to a total of US $ 2.6 trillion.
Video streaming, which experienced an explosion of growth in 2020, is expected to continue its positive momentum. The report predicts SVOD growth at a CAGR of 10.6% by 2025 to $ 81.3 billion.
Werner Ballhaus, Global Entertainment & Media Industry Partner, PwC Germany, said: “The pandemic slowed down the entertainment and media industry last year, but it has also accelerated and amplified changes in power that was already transforming the industry. Whether it’s box office revenue transfers to streaming platforms, the transfer of content to mobile devices or the increasingly complex relationships between creators, producers and distributors of content, the dynamics and the power within the industry continue to change. Our outlook shows that thirst for content, continued advancements in technology, and new business models and ways to create value will drive industry growth for the next five years and beyond.
But while the report is bullish on the future of streaming, it notes that major tech platforms are likely to experience a setback in the coming years as governments propose new media regulations. The United Kingdom, for example, is seeking to place streaming services under Ofcom’s control.
Balhaus added, “Even in the areas that offer the most compelling revenue growth – such as video streaming – the nature of competition is likely to change dramatically over the coming years. And meanwhile, the social, political and regulatory environment in which all businesses operate continues to evolve in unpredictable ways. All of this means that standing still, relying on strategies that have created value and blocked market share in the past, will not be the most effective posture in the future. “
