The Indian media and entertainment (M&E) sector has been on a remarkable growth trajectory, with the latest Ficci-EY report projecting a continued expansion in the coming years. In 2023, the sector reached a significant milestone, touching ₹2.3 trillion in revenue. However, while this growth is impressive, it represents a slight slowdown compared to the previous year, mainly attributed to challenges faced in advertising during the first half of the year.
Despite the overall slowdown, there were notable areas of growth within the sector. Except for television, all segments of the M&E industry experienced positive growth in 2023. Notably, the contribution of new media, including digital and online gaming, increased substantially. Digital media emerged as a key driver of growth, contributing ₹12,200 crore to the total revenue and accounting for 38% of the sector’s revenue in 2023.
Looking ahead, the Ficci-EY report forecasts a compound annual growth rate (CAGR) of 10% for the M&E sector, reaching ₹3.08 trillion by 2026. This projection underscores the resilience and potential of the industry despite temporary setbacks. Television, digital media, filmed entertainment, and animation and VFX are expected to be the key contributors to this growth, with estimated revenues touching ₹71,800 crore, ₹75,100 crore, ₹20,700 crore, and ₹13,200 crore, respectively, by 2024.
The report highlights the shifting dynamics within the M&E sector, with traditional media witnessing a decline in its share of revenue. While television remains a dominant player, its advertising revenues experienced a decline of 6.5% in 2023, primarily due to reduced spending by gaming and direct-to-consumer (D2C) brands. However, subscription revenues saw growth following price increases, indicating resilience in consumer demand.
On the other hand, digital media continued its upward trajectory, with advertising revenues growing by 15% to reach ₹57,600 crore in 2023. Digital subscription revenues also saw growth, albeit at a slower pace compared to previous years. However, challenges such as piracy and saturation among urban elite audiences have impacted the growth potential of digital platforms.
Another area of growth within the M&E sector is online gaming, which saw a 22% increase in revenue to reach ₹22,000 crore in 2023. The popularity of online gaming has surged, with over 450 million gamers in India, of which approximately 100 million play daily. Real money gaming comprises a significant portion of segment revenues, although regulatory challenges and higher GST levies have impacted margins.
The film industry also experienced growth, with revenues reaching ₹19,700 crore in 2023. Theatrical revenues reached an all-time high of ₹12,000 crore, driven primarily by increasing ticket prices. However, theatrical footfalls are still below pre-pandemic levels, indicating a need for further recovery.
Despite these positive trends, the animation and VFX segment faced challenges in 2023, growing just 6% due to global supply chain disruptions and declining ad revenues. Potential mergers and reduced investment in animated content production further impacted the segment’s growth.
The Ficci-EY report paints a promising picture for the Indian M&E sector, with digital media emerging as a key growth driver. While traditional media continues to play a significant role, the industry is witnessing a shift towards digital consumption patterns. With continued innovation and adaptation to changing consumer preferences, the M&E sector is poised for sustained growth in the years to come.
