New Delhi [India], September 30 (ANI): The media and entertainment (M&E) sector should recover from its current levels and post a 33 per cent growth in FY22 (following a contraction of 20 per cent in FY21), which still implies a loss of around two years of growth, KPMG in India said in its latest report here on Wednesday.
KPMG in India today launched the twelfth edition of its Media and Entertainment report, titled 'A year off script: Time for resilience' that examines the performance of the M&E sector during a particularly challenging period.
The report said India was already experiencing a slowdown in economic activity even prior to the outbreak of COVID-19 in March and the onset of the global pandemic and ensuing lockdown dealt a severe blow to the Indian economy.
The M&E sector has been affected but to varying degrees: outdoor entertainment formats (films and events) and traditional media (print and TV to some extent) have been badly impacted as people stayed indoors and advertising spends dried up.
The report said: "The two areas that offer encouragement are the continued economic growth of Bharat and the universal acceleration of digital adoption among users across geographies and SECs. As per our revised estimates, India could be home to a billion digital users by 2028 rather than the earlier projected 2030 timeline."
"There have been several structural changes to digital behaviour on account of the experience of the lockdown resulting in a new homogeneity among users, and it is our belief that many of these changes will translate into a more democratic and sophisticated digital citizenry within the country," it added.
Digital advertising, OTT and gaming fared much better, with massive spikes in digital consumption during the lockdown across geographies and socio-economic classes.
It projected that digital advertising spends are now set to overtake those on TV by FY21, which is an important milestone and turning point in the evolution of M&E in India.
"The distinction among segments of M&E has become more pronounced with the experience of the lockdown. Marketing spend has moved perceptibly towards digital media and away from traditional segments like print, radio and to some extent TV," said Satya Easwaran, Partner and Head, Technology, Media and Telecom, KPMG in India.
"A greater reliance on subscription and other paid options as well as the development of a credible digital business model is going to be inevitable for these traditional media segments," added Easwaran.
Organisations face a multitude of challenges and competing priorities but based on a survey of CXOs conducted by KPMG in India, customer focus and revenue growth are expected to drive digital-first initiatives over the near term within organisations, with cost reduction also emerging as important to traditional media segments.
"There will be a deeper integration of digital technology across the M&E value chain - from content production to distribution. Technology adoption could however face some challenges in terms of skill development and the shift to a digital-first mindset but will result in operational cost savings and potentially lower lead times over the longer term," said Girish Menon, Partner and Head, Media and Entertainment. (ANI)