The global entertainment & media (E&M) industry is experiencing sustained growth which will increase at a 6.4% compound annual growth rate (CAGR) to $2 trillion by 2011, according to a new report published by PriceWaterhouseCoopers.
Global Entertainment and Media Outlook 2007-2011
report found that double-digit growth is expected for digital and mobile spending worldwide over the next five years, rising to $153 billion by 2011.
The Middle East is expected to play a significant role in driving this growth, according to the report's findings.
While total revenue generated by European, Middle East and African markets is expected to increase by 5.5% CAGR to reach $617 billion in 2011, the Middle East and African markets are expected to grow by 8.5%, compounded annually during the forecast period.
TV distribution, Internet advertising and access spending, and video games will be the fastest growth segments for EMEA, averaging double-digit compound annual increases during the next five years, the report predicted.
Spending related to the distribution of entertainment and media on convergent platforms is also growing at double-digit rates and will exceed 50% of global spending by 2011, it added.
Within the next five years, nearly half of total industry growth is expected to be generated by online and wireless technologies and, during the same period, broadband-enabled households will grow by 300 million to 540 million subscribers and wireless subscribers will increase by 1.1 billion to 3.4 billion.
Global spending on convergent platforms will grow faster than other E&M platforms and will account for 72% of the total E&M growth during the next five years, the report stated. Asia Pacific will be the fastest-growing convergent platform region with a projected 13.5% increase, while double-digit growth is expected in Latin America as internet and broadband penetration begins to gain momentum.
Economic expansion and a surging entertainment and media market are also driving significant growth in Brazil, Russia, India and China (BRIC).
Asia Pacific is earmarked as the fastest-growing region over the next five years, while the US will remain the largest but slowest growing E&M market, with a 5.3% compound annual growth rate achieving $754 billion in revenues by 2011. US spending on Internet advertising and access is expected to surpass spending on newspaper publishing in 2009.
"The surge in broadband and wireless adoption is generating new digital revenue streams across multiple segments," said Marcel Fenez, global managing partner, Entertainment & Media Practice, PricewaterhouseCoopers.
"Broadband growth is driving online advertising while the proliferation of next-generation wireless devices designed to play digital music, video games and receive TV programming is fuelling mobile distribution.
"Content, distribution and technology companies need to aggressively seek out new relationships to accommodate the shift towards convergence. Furthermore, companies will need to test new business models to address increased fragmentation and intellectual property in a digital era. Deal activity across the entertainment and media sector is accelerating, driven by the migration to digital formats."For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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