PwC Outlook: Digital Is Driving Entertainment And Media
June 14, 2011 at 8:01 AM (PT)
PRICEWATERHOUSE COOPERS has released its new "Entertainment and Media Outlook" for 2011-2015, which provides in-depth global analyses and five-year market forecasts on the entertainment and media industry.
According to the Outlook, the entire entertainment and media industry is being driven to create experiences that engage today's empowered consumer by redesigning the content experience to be multi-purpose and multi-platform which, in turn, creates multiple opportunities for monetization.
Wrote PwC, "As we move into the golden age of the empowered consumer, the demand for digital experiences is increasing and becoming the norm."
The report finds that digital is acknowledged as the central driver of future operating models, consumer relationships and revenue growth. Emerging out of recession and into recovery in 2010, the Outlook forecasts that global entertainment and media spending is expected to rise from $1.4 trillion in 2010 to $1.9 trillion by 2015, growing at a compound annual growth rate of 5.7%. The U.S. E&M market is expected to grow at 4.6%, reaching $555 billion in 2015, from $443 billion in 2010.
How does radio fare? U.S. terrestrial radio is expected to grow at a compound annual growth rate of 2.6% over the next five years, from $15.7 billion in 2010 to $17.8 billion in 2015.
"Triggered in large part by the device revolution, the consumer migration to digital has continued at an even faster pace and at the same time advertisers are responding by seeking a greater involvement with the consumer’s media and entertainment experience," said PwC Entertainment, Media & Communications U.S. Practice Leader KEN SHARKEY. "The biggest challenge for E&M companies is to turn five key attributes that matter to consumers -- convenience, experience, quality, participation and privilege -- into sustainable, profitable and engaged relationships by offering advantages that outweigh the attractiveness of free or pirated content."
While digital currently accounts for just over a quarter of total industry revenues, it is expected to account for 58.7% of all growth in spending during the next five years, globally. Digital spending in the U.S. is expected to account for 28.5% of all E&M spending in 2015, up from 20.6% in 2010.