continued from Part I
Key segmental findings of the report:
The TV industry grew from INR 660 billion to INR 740 billion in 2018, a growth of 12%. TV advertising grew 14% to INR 305 billion, while subscription grew 11% to INR 435 billion. Television viewing households increased to 197 million, which is a 7.5% increase over 2016. Regional advertising growth outpaced national adverting growth on the back of national brands spending more to develop non-metro markets, where GST created a level playing field between national and regional brands. Seventy seven per cent of the time spent on television was on general entertainment content and film channels.
Print accounted for the second largest share of the Indian M&E sector, despite being static and growing at 0.7% to reach INR 305.5 billion in 2018. Advertising revenues stood at INR 217 billion and subscription revenues grew marginally by 1.2% to INR 88.3 billion in 2018. Newspaper advertising de-grew 1% while magazine advertising fell 10%. The fall in advertising is due to reduced ad volumes as well as pressure on effective rates. Hindi newspaper publications continued to lead with 37% of total ad volumes, while the share of English publications stood at 25%. Rising newsprint prices and depreciation in the value of the Indian Rupee led to pressure on print sector margins in 2018.
The Indian film segment grew 12.2% in 2018 to reach INR 174.5 billion driven by the growth in digital/OTT rights and overseas theatricals. All sub-segments, except home video grew. Domestic film revenues crossed INR 100 billion with net box office collections for Hindi films at INR 32.5 billion - the highest ever for Hindi theatricals. Overseas theatricals grew to INR 30 billion from INR 25 billion in 2017, where China became the largest international market for Indian content. 98 Hollywood films were released in 2018 as compared to 105 in 2017. The box office collection of Hollywood films in India (inclusive of all their Indian language dubbed versions) was INR 9.21 billion. Multiplexes drove up the screen count to 9,601, though single screens continued to reduce.
In 2018, digital media grew by 42% to reach INR 169 billion. Infrastructure propelled the growth in digital consumption. Digital ad spends grew 34% to INR 154 billion and now contribute around 21% of the ad market. Digital subscription grew 262% to reach INR 14 billion. Video subscription revenues almost grew three times in 2018 to reach INR 13.4 billion, on the back of new and relaunched video streaming platforms, growth of smartphones, spread of affordable broadband, regional language content, exclusive content and live streaming of major cricket and other impact properties.
Mergers and acquisitions:
The Indian M&E sector witnessed an interesting mix of deal activity in 2018 on the traditional as well as the new media front. The number of deals in M&E in 2018 remained the same at around 40 ,though the deal value more than doubled in 2018 to USD 2.8 billion from USD 1.3 billion in 2017. 41% of deals were in the digital segment in 2018, compared to 30% of deals in 2017 while deals in the gaming segment came next with 20% of the deals. The digital segment has been at the forefront of deal activity as India’s demographic dividend in the form of smartphone users, internet penetration and improving bandwidth continues to grow exponentially. The consolidation wave in the M&E sector is expected to accelerate and continue, as large media corporate companies strengthen their presence for achieving scale, reach and relevance. The sector is also gaining considerable amount of interest from global strategic players who want to be part of the rapid growth in this sector, on the back of greater availability of data.