Introduction

The media and entertainment (M&E) sector in India is growing quickly and is a sunrise
industry for the economy. The sector has benefited greatly from the growing availability of
fast, affordable internet, rising incomes, and expanding consumer durable purchases. In
comparison to other markets, the media and entertainment sector in India is distinctive. The
sector is renowned for its extraordinarily high volume and growing Average Revenue Per
User (ARPU).
This helped the nation's economy tremendously, propelled India to the forefront of digital
adoption, and gave businesses continuous access to valuable data that helped them better
understand their customers. India has seen expanding potential in the VFX industry as the
world's attention has turned to India as a favoured content producer.
Indian M&E industry is on the verge of a strong phase of growth, supported by increasing
consumer demand and improving advertising revenue, demonstrating its resilience to the
world. A FICCI-EY report predicts that the ratio of advertising to GDP will drop from 0.38% in
2019 to 0.4% by 2025.

Infographics
Advantage
1. Robust Demand- In India, there will be 900 million internet users by 2025, up from
622 million in 2020, according to a report by IAMAI and Kantar Research. This growth
will occur at a CAGR of 45% from 2020 to 2025.
By 2025, it is anticipated that the advertising-based video on demand (AVoD) market
would grow at a CAGR of 24% and reach US$ 2.6 billion.

2. Attractive Opportunities- According to a FICCI-EY analysis, TV is anticipated to

continue being the largest market within the M&E sector and is estimated to show a
CAGR of 7% to Rs. 847 billion (US$ 12.01 billion) by 2023.
By 2025, the Indian mobile gaming market is anticipated to be worth $7 billion.

3. Policy Support- The Indian government raised the FDI ceiling from 74% to 100%.
The government declared in November 2021 that it is aiming to establish a National
Center of Excellence for AVGC (animation, visual effects, gaming and comics).

4. Higher Investments- Between April 2000 and June 2022, FDI inflows into the
information and broadcasting sector (including print media) totaled $9.79 billion.
Animation and VFX studios now have prospects in both local and foreign markets as
a result of the OTT channels' explosive expansion, the studios' greater emphasis on
animated intellectual property (IP) content, and the studios' increased investments
in VFX.

Industry Report-
Due to rising incomes and changing lifestyles, there is enormous room for expansion across
the board in the Indian media sector. According to the most recent PwC research, India's
media and entertainment sector is predicted to generate US$ 53.99 billion (Rs. 4,30,401
crores) by 2026. Between 2019 and 2026, the market is anticipated to grow at a CAGR of
12.95 percent.
Digital and online added income in the M&E industry reached Rs. 26 billion in FY20, and
their contribution to the industry rose to 23% in 2020 from 16% in 2019. The following
segments are anticipated to grow between 2019 and 2024: digital media (CAGR 20%),
animation and visual effects (47%), online gaming (23.07%), and out-of-home (39.08%).
According to Mr. Piyush Goyal, the Union Minister of Commerce & Industry, Consumer
Affairs, Food & Public Distribution, and Textiles, the AVGC sector is expected to increase by
9% by 2024 to reach Rs. 3 lakh crore (US$ 43.93 billion). The digital advertising market in
India is anticipated to increase from Rs. 18,938 crore (US$ 2.47 billion) in 2021 to Rs. 23,673
crore (US$ 3.09 billion) in 2022.
According to projections, India's subscription revenue will increase from Rs. 631 billion (US$
8.95 billion) in 2020 to Rs. 940 billion (US$ 13.34 billion) in 2023. By 2022, BCG predicts that
India's SVOD subscribers would have grown by 51% over 2019 levels, reaching 90–100
million.
By 2024, the Indian publishing market is anticipated to be worth Rs. 80,000 crore (US$ 10.74
billion), according to EY-Parthenon. Rising user demand for content and reasonably priced
subscription options were important development factors. In line with the worldwide trend,
the Indian mobile gaming market is expanding quickly and is anticipated to reach US$ 1.99
billion in 2024.
From US$ 199 million in 2019, the music industry is anticipated to grow to US$ 366 million
by 2024. The business is expanding as a result of platforms like YouTube continuing to
provide new music that is associated with video content for free. This trend is anticipated to
propel the paid OTT music sector to reach 5 million end users by 2023 and generate revenue
of Rs 2 billion (US$ 27 million).
40–50 million connected smart televisions are anticipated to exist by 2025. Gaming, social
media, brief videos, and content items created specifically for this audience by television,
print, and radio marketers will make up 30% of the content viewed on these screens. Due to
significant growth initiatives taken by original equipment manufacturers (OEMs) for their
smart TV portfolios, smart TV exports from India surged by 65% YoY in the second quarter of
2021. 600–650 million Indians will watch short-form videos by the year 2025, with active
users averaging 55–60 minutes daily.
By 2023, 399 million people will watch online videos through bundled packages (online
video services combined with mobile and internet connections), up from 284 million in
2020, according to the FICCI-EY media and entertainment sector survey.
India recorded 803 million internet video watchers as of 2020, including users of streaming
services and those who watched free sites like YouTube. In 2020, there were 356 million
mobile video watchers, largely due to users' increasing preference for video content in
recent years.
The market for OTT video services (live and on-demand) in India is predicted to grow at a
CAGR of 29.52% to reach US$ 5.12 billion by FY26. This growth will be fueled by customers'
growing desire for high-quality content and the quick development of online platforms.
The Indian government has supported the expansion of this industry by implementing a
number of initiatives, including digitising the cable distribution industry to draw in more
institutional funding, raising the foreign direct investment (FDI) ceiling for cable and direct-
to-home (DTH) satellite platforms from 74% to 100%, and giving the film industry industry
status to facilitate easy access to institutional financing. Between April 2000 and June 2021,
FDI inflows into the information and broadcasting sector (including print media) totaled US$
9.6 billion.
The Indian Broadcasting Foundation (IBF) announced in May 2021 that it will change its
name to the Indian Broadcasting and Digital Foundation as part of its development to
embrace all digital platforms and digital (OTT) companies under a single roof (IBDF). IBDF
will shortly establish a self-regulatory body (SRB) in accordance with the Information
Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021.
The National Film Development Corporation's (NFDC) Film Facilitation Office (FFO) and the
Ministry of Railways worked together to create an integrated single window filming
mechanism to simplify the application process for filming on all railroad property in order to
facilitate filmmaking in railways. Additionally, the government declared its intention to
establish a National Center of Excellence for AVGC (animation, visual effects, gaming and
comics).