According to PwC’s newly released Global Entertainment & Media Outlook 2021-2025, the global entertainment and media business will grow by 6.5 percent in 2021 and 6.7 percent in 2022, with robust demand for digital content and advertising powering this new vigor.
The Chaos of the Pandemic: The paper added that the increase in growth comes after a dismal pandemic-ravaged 2020, which saw in-person entertainment come to a halt, particularly in movie theater box office revenues, which fell by 71%.
Revenue in the global entertainment and media business fell by 3.8 percent from $2.1 trillion in 2019 to $2 trillion in 2020, the worst year-over-year loss since PwC began tracking this data 22 years ago.
A More Promising Future: However, PwC predicts that this market would increase at a 5% compound annual growth rate (CAGR) from now until 2025, bringing total revenues to $2.6 trillion.
Within this sector, PwC predicts that video streaming will grow at the fastest rate, with a predicted CAGR of 10.6 percent through 2025, making it a $81.3 billion market. Within four years, video game and esports revenues are predicted to grow at a 5.7 percent compound annual growth rate (CAGR) to reach approximately $200 billion.
Virtual reality was highlighted as the fastest-growing segment in the sector, albeit coming from a lower base than the other businesses. PwC estimates that it will increase at a CAGR of more than 30% over the next five years, reaching $6.9 billion in revenue in 2025.
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Music, for example, saw a 74.4 percent drop in live performance revenues in 2020, but its total revenues are expected to grow at a 12.8 percent CAGR over the next five years to $29.3 billion by 2025, thanks primarily to digital streaming, with the return of live performances adding to the revenue stream as concert venues reopen and mammoth venues reopen.
In the coming years, two industries within the sector are likely to struggle: According to PwC, movie ticket sales will not recover to pre-pandemic levels until at least 2024. While traditional television and home video is the largest consumer segment, with a market value of $219 billion, its CAGR is predicted to fall by 1.2 percent over the next five years.
It’s Worth It To Advertise: PwC discovered that internet advertising spending increased by 9% to $336 billion last year, surpassing non-internet advertising spending for the first time. Over the next five years, Internet advertising is expected to grow at a 7.7% compound annual growth rate (CAGR).
“No country’s combined consumer and advertising revenue will grow at less than a 3% five-year CAGR to 2025,” according to the research, with Japan having the lowest CAGR at 3.1 percent. “By comparison, in the 2019 version of this analysis, 26 countries, including nearly all of Western Europe, fell below a 3.0 percent five-year CAGR.” “Saudi Arabia, whose market has been considerably reinforced by the lifting of a 35-year ban on cinemas in 2018, and Nigeria, where surging video games and TV subscription revenue will increase the five-year CAGR to more than ten per cent,” the paper noted.
(c) Benzinga.com, 2021. Benzinga does not offer financial advice. All intellectual property rights are reserved./n
