india : entertainment sector report_august 2013

Third largest TV market • With 146 million television households in 2011, India stood as the third largest television

market after the U.S. and China

One of the largest

broadcasting market

• India has one of the largest broadcasting industries in the world with approximately 800

satellite television channels, 245 FM channels and more than 100 operational community

radio networks

Rising no. of

subscribers

• The total subscriber base for Indian television industry is expected to increase to 173

million by 2016 from 95 million in 2009

Fast growing Animation

industry

• The Indian animation industry is expected to expand at a CAGR of 15.8 per cent to

USD1.4 billion by 2017 from USD650 million in 2012

Source: Planning Commission, Aranca Research

• The engineering sector is delicensed; 100 per cent FDI is allowed in the sector

• Due to policy support, there was cumulative FDI of USD14.0 billion into the sector over April 2000 – February 2012, making up 8.6 per cent of total FDI into the country in that period

Growing demand

Source: KPMG report 2012, Aranca Research

Notes: AGV - Animation, Gaming and VFX, VFX - Visual Effects, M&A - Merger and Acquisition,

CAGR - Compound Annual Growth Rate, FDI - Foreign Direct Investment, E - Estimate

Robust demand

• Rising incomes and evolving lifestyles have led to higher demand for aspirational products and services

• Higher penetration and a rapidly growing young population coupled with increased usage of 3G and portable devices would augment demand

Attractive opportunities

• Industry is set to expand at a CAGR of 15.1 per cent over 2012–17, one of the highest rates globally

• Television and AGV segments expected to lead industry growth; opportunities in digital technologies as well

Policy support

• Policy sops, increasing FDI limits

• Measures such as digitisation of cable distribution to improve profitability and ease of institutional finance

• Increasing liberalisation and tariff relaxation

Increasing investments

• Higher FDI inflows

• Increasing M&A activity

• More big-ticket deals such as Walt Disney- UTV, Sony-ETV and Zee- Star

• Entry of big players across all segment of industry

2012

Market

Size:

USD15.1

billion

2017E

Market

Size:

USD30.5

billion

Advantage

India

Source: KPMG Report 2013, Aranca Research

Notes: VFX - Visual Effects

Entertainment

Television

Gaming

Animation & VFX

Out Of Home (OOH)

Music Digital

Advertising

Radio

Films

Print

Market size (USD billion)


Note: F - Forecast, CAGR - Compound Annual Growth Rate,

* In Indian rupee terms

The entertainment industry is expected to develop at a

CAGR of 15.1 per cent during 2012–17

The total market size of the entertainment industry

expanded to USD15.1 billion in 2012 from USD9.2 billion in

2006, at a CAGR of 10.9* per cent

The industry recorded one of the highest growths in the

world in 2010 (11.0 per cent); the growth in 2012 picked up

even further to reach 12.6 per cent

9 11 12 12

14 15 15 17

19 23

26 31

0%

5%

10%

15%

20%

0

5

10

15

20

25

30

35

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3F

201

4F

201

5F

201

6F

201

7F

size (USD Billions) Growth (RHS)

Size of major industry segments (2012)


The entertainment industry continues to be dominated by the television segment, accounting for 45 per cent of market

share in terms of revenues, which is expected to grow further to 51.0 per cent by 2017E

Television, print and films together account for 86 per cent of market share

Size of major industry segments (2017)

45%

27%

14%

2% 1%

2% 4%

2% 3%

Television

Print

Films

Radio

Music

Out of Home

Animation and VFX

Gaming

Digital Advertising

51%

20%

12%

2% 1%

2% 4%

3% 5%

Television

Print

Films

Radio

Music

Out of Home

Animation and VFX

Gaming

Digital Advertising

Growth of television industry (in 2011)


Note: E - Estimates

With a growth rate of 15.8 per cent in 2011, Indian television industry stood second when compared with BRIC and other

major developed economies

Currently, the television industry in India derives the major share of its revenue from subscription segment (65 per cent)

and the rest from advertising (35 per cent)

The revenue share from subscription segment is expected to reach 69 per cent by 2016, driven by higher penetration of

subscription television

Television segments

2.1%

3.6%

10.6%

14.4%

15.8%

22.5%

United States

UnitedKingdom

China

Russia

India

Brazil

35% 31%

65% 69%

2011 2016E

TV advertising Subscription revenues

Industry size of emerging segments (USD millions)


Notes: VFX- Visual Effects; F - Forecast,

CAGR - Compound Annual Growth Rate

Radio, Animation & VFX, Gaming and Digital advertising

are also emerging as fast growing segments

The total market share in terms of revenue is expected to

reach 15 per cent by 2017 from 11 per cent in 2012

During 2012–17, these segments are expected to develop

at a CAGR of:

Digital advertising (41.6 per cent)

Gaming (28.8 per cent)

Radio (21.2 per cent)

Animation (20.1 per cent)

0

20

40

60

80

20

07

20

08

20

09

20

10

20

11

20

12

20

13F

20

14F

20

15F

20

16F

20

17F

Radio Animation and VFX

Gaming Digital Advertising

Advertising revenue forecast


Note: OOH - Out Of Home, F - Forecast

Total spending on advertising across all media stood at USD5.5 billion, accounting for 41 per cent of the total industry

revenue in 2011

Advertising revenue is expected to touch USD10.8 billion by 2016 from USD5.5 billion in 2011

Print is the largest contributor, accounting for 46 per cent of the advertising share

Advertising revenue share (2011)

39%

46%

6%

5% 4%

TV

Print

OOH

Digital Advertising

Radio

5.0

5.1 4.9

5.7 5.5 6.1 7.1

8.1

9.3 10.8

-10%

-5%

0%

5%

10%

15%

20%

0

2

4

6

8

10

12

200

7

200

8

200

9

201

0

201

1

201

2F

201

3F

201

4F

201

5F

201

6F

Total revenue- (USD billion) Growth (%) -RHS

Source: Company Websites, Business Week, KPMG report 2012 Aranca Research

Notes: M&E - Media and Entertainment

Company Business description

Star India Pvt Ltd

• Fully owned subsidiary of News Corporation

• Portfolio includes 33 channels in seven languages across various categories such as soaps, reality, news and films

• Also manages a portfolio of business ventures including DTH operator Tata Sky, cable system Hathway, channel

distributor STAR Den, news channel operator MCCS, the film production and distribution business Fox STAR Studios

India and STAR CJ Home Shopping

Zee Entertainment Enterprises Ltd

• Fully owned subsidiary of Essel Group and first listed media company in India

• One of the largest producers and aggregators of Hindi programming in the world

• An estimated reach of more than 670 million viewers across 168 countries

• Pioneer of television entertainment industry in India; launched Zee TV- the country’s first Hindi satellite channel

• Range of businesses across the value chain in the M&E industry

Multi Screen Media Pvt Ltd

• Fully owned subsidiary of Sony Pictures Entertainment

• Comprises of Sony Entertainment Television (SET) and SAB, leading Hindi general entertainment television

channels; MAX, a movies and special events channel; and PIX, a channel that airs Hollywood movies

• Its programming spans across various genres including drama, reality, comedy, horror, Bollywood and live events

Source: Company Websites, The Times of India, Aranca Research

Notes: CAGR - Compound Annual Growth Rate, FY - Financial Year


Bennett, Coleman and Co Ltd

• Largest media conglomerate in India

• Publishes world’s most widely circulated English broadsheet daily ‘The Times of India’ and second most widely

circulated financial daily ‘Economic Times’

• Other prominent publications include magazines such as Zigwheels, Filmfare, Femina and Top Gear and Hindi dailies

such as Navbharat Times and Sandhya Times

• The group has also diversified into radio and television business

HT Media Ltd

• Hindustan Times is the second most widely read newspaper with 3.8 million readers in India

• Other prominent publications include the business daily Mint and the Hindi daily Hindustan

• The group has also forayed into many adjacent businesses such as print and digital services, internet, radio, and

events and marketing solutions

• The company’s job portal www.shine.com has over 8.5 million registrations

Living Media India Ltd

• India Today and Readers Digest are among India’s most circulated magazines

• Other prominent magazine publications include Business Today, Cosmopolitan, Time, Golf Digest, Design Today,

Money Today and The Chartered Accountant

• The group has interests in various other businesses such as radio, events, printing, music, television, education and

publishing

Source: Company Websites, Business Week, Aranca Research


Yash Raj Films Studios

• The only privately owned film studio in India

• Apart from film production, the company has also expanded into distribution of films and music, home entertainment,

production of television software, ad films, documentaries and private label music production

• The company launched a youth films studio Y-Films in 2011 to connect with the large young population of the country

Eros International Media Ltd

• Strong distribution network spanning across 50 countries and over 27 dubbed foreign languages

• One of the largest content owners in the industry having a film library of over 2600 films, thus ensuring stable, recurring

cash flows

• The company is diversifying into Marathi, Punjabi, Tamil and other regional language films to leverage upon the

growing demand for regional cinema

Red Chillies Entertainments Pvt Ltd

• Founded in 2002 as a film production house, the company has branched into TV shows and advertisement, visual

effects and multi-media production equipment leasing

• Its latest venture 'Ra.one‘ is Bollywood's most expensive movie and very first Sci-fi movie

• It also owns the Kolkata Knight Riders cricket franchise in the Indian Premier League

Source: Company Websites, Business Week, Aranca Research


Music Bharti

• A wholly owned subsidiary of Bharti Airtel

• The largest music company in terms of revenues

• Provides mobile-based value-added music services (VAS) such as hello tunes, call back tunes, music on demand,

Mirchi mobile and Airtel radio

Saregama India Ltd

• The company owns the largest music archives in India, one of the largest in the world

• It uses the music labels Saregama, RPG Music and HMV

• The company is making efforts to digitise its catalogue to make inroads into the digital music market and counter

declining physical music sales

Super Cassettes Industries Ltd

• The company owns the rights to over 2,000 video and 35,000 audio titles, comprising of nearly 24,000 hours of music

• The company has diversified into film production, consumer electronics and mobile phones manufacture

Tips Industries Ltd

• The company owns 3,500 titles of which a minimum of 25 have been sold over a million copies, with another 10

selling over 10 million copies

• Since 1981, Tips has the highest number of gold and platinum discs to their credit in India

• Tips also holds soundtrack copyrights of over 50 Hindi movies and has also ventured into film production

• The company’s distribution channel serves more than 1,000 wholesalers across country

Television

• Television penetration in India is at about 60 per cent and penetration is expected to reach

70 per cent by 2016

• The government announced the digitisation of cable television in India in four phases,

which would be completed by the end of 2014

• The direct-to-home (DTH) subscription is growing rapidly driven by content innovation and

product offerings

• The subscription share to the total revenue is expected to grow to 69 per cent by 2016

Print

• Considering the huge potential in regional print markets, national advertisers are entering

these markets to increase their advertising share

• Increasing income levels and evolving lifestyles have led to robust growth in niche

magazines segment

• Increasing literacy levels leading to a rise in the readership base

Film

• Growth to be fuelled by multiplex chains, increasing footfalls of consumers and higher

quality content

• Increasing share of Hollywood content in the Indian box office

• 3D cinema is driving the growth of digital screens in the country

• The Indian film industry is largest producer of films globally with 400 production houses

and corporate houses involved in film production

Source: KPMG Report 2012, Economic Times, Aranca Research

Notes: DTH - Direct to Home, 3D - Three Dimension

Animation, Gaming and

VFX (AGV)

• Growing focus on the ‘kids genre’ and rise in dedicated channels for them

• Surge in 3D/HD animated movies in theatres and use of animation and VFX in TV

advertising and gaming

• Growing outsourcing of VFX and gaming to India is due to cost effectiveness of Indian

players

• Content localisation such as T20fever.com and ICC World Cup 2011 games

Radio

• Increasing FM enabled radio phones, mobiles and car music systems

• During 2010, there were a total of 245 channels operating across India

• Government introduced favorable guidelines for expansion of the 3rd phase of FM radio

broadcasting services, which will bring 294 towns and 839 stations under FM coverage

• Liberalisation of policy on community radio took place in 2008 which led to 29 community

radio stations getting operational in the country

Music

• The Indian music industry is a consortium of 142 music companies

• Players are looking at new ways and mediums to monetise music, such as utilising social

media to promote music

• Mobile phones, iPods and mp3 players – devices that enable music on-the-go – are

becoming the primary means to access music

• Digital music on mobile continues to drive music industry revenue

Source: KPMG Report 2012, Economic Times, Aranca Research

Source: Aranca Research

Growing demand

Inviting Resulting in

Growing demand Increasing investments Policy support

Higher real

incomes and

changing lifestyles

Falling prices,

increasing

penetration

Growing young

user base with high

access to

technology

Policy sops, favourable FDI

climate

Policies to enhance growing segments like animations and

gaming

Increasing

liberalisation,

tariff relaxation

Higher FDI inflows

Increasing M&A

activity

Increasing

participation of big

players

Rising per-capita income in India (USD)

Source: IMF, Aranca Research,

Note: CAGR - Compound Annual Growth Rate

Incomes have risen at a brisk pace in India and will continue

rising given the country’s strong economic growth

prospects. Nominal per capita income is estimated (IMF) to

have recorded a CAGR of 11.2 per cent over 2000–12

Rising incomes, with its positive impact on the consumer

base, will be the key growth driver for the entertainment

industry (across the country)

As the proportion of ‘working age population’ in total

population increases, per capita income and GDP are

expected to grow higher -5%

0%

5%

10%

15%

20%

25%

30%

300

600

900

1,200

1,500

1,800

2,100

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

F

20

12

F

20

13

F

20

14

F

20

15

F

20

16

F

20

17

F

Gross domestic product per capita, current prices Growth

Indian residents shifting from low-income to high-

income groups

Source: McKinsey Quarterly Report, Aranca Research

Apart from the impact of rising incomes, widening of the

consumer base will also be aided by expansion of the

middle class, increasing urbanisation, and changing

lifestyles

The entertainment industry will also benefit from continued

rise in the propensity to spend among individuals; empirical

evidence points to the fact that decreasing dependency ratio

leads to higher discretionary spending on entertainment

1 3 7 2 6

17 12

25

29 35

40

32 50

26 15

2008 2020 2030

Globals (>18412.8) Strivers (9206.4-18412.8)

Seekers (3682.5 - 9206.4) Aspirers (1657-3682.5)

Deprived (<1657)

Million Household,100%

Television

• Digitisation of the cable distribution sector to attract greater institutional funding, improve

profitability and help players improve their value chain

• FDI limit increased from 49 per cent to 74 per cent in cable and DTH satellite platforms in

2012

• No restriction on foreign investment for uplinking and downlinking of TV channels other

than news and current affairs

Film

• Co- production treaties with various countries such as Italy, Brazil, UK and Germany to

increase the export potential of the film industry

• Granted ‘industry’ status in 2001 for easy access to institutional finance

• FDI upto 100 per cent through the automatic route has been granted by government

• Entertainment tax to be subsumed in the GST; this would create a uniform tax rate regime

across all states and will also reduce the tax burden

Radio

• FDI limit in radio increased to 26 per cent from 20 per cent in 2011

• Private operators allowed to own multiple channels in a city, subject to a limit of 40 per

cent of total channels in the city.

• Private players allowed to carry news bulletins of All India Radio

• Further boost may be given to the radio sector by charging licence fees on the basis of

‘net income’ so as to provide relief to loss making radio players

Source: Aranca Research,

Notes: FDI – Foreign Direct Investment, FII – Foreign Institutional Investors

Print

• FDI/NRI investment upto 26 per cent in an Indian firm dealing with publication of

newspaper and periodicals

• FDI/NRI investment upto 26 per cent in publications of Indian editions of foreign

magazines

• FDI/NRI investment upto 26 per cent in publications of scientific and technical magazines/

specialty journals/ periodicals

Music

• Parliamentary approval on the Copyright Act (Amendment) Bill, 2012, which strengthens

the royalty claims of musicians, lyricists and others in the field

• Policies are adopted against digital piracy and file-sharing; steps have been taken to block

illegal music websites

• Adoption of revenue sharing model by Copyright Board requiring FM radio companies to

share 2 per cent of their net advertising revenues with music companies

Animation, Gaming and

VFX (AGV)

• 100 per cent FDI allowed in the sector through automatic route provided it is in compliance

with Reserve Bank of India guidelines

• The government has craved out a National Film Policy to tap the potential of the film

sector mainly for the animation segment

Source: PwC India Entertainment and Media Outlook 2011, KPMG report 2012, Aranca Research

Source: Digital Dawn, KPMG Report 2013, Aranca Research

In December 2011, the Indian government passed ‘The Cable Television Networks (Regulation) Amendment Act’ for

digitisation of cable television networks by 2014

The cable operators under the digitisation regime are legally bound to transmit only digital signals, while the customer can

access the subscribed channels through a set-top box

The number of DTH subscribers in India is expected to increase from 44 million currently to 200 million by 2018

The entire process of digitisation will be carried out in four phases

Phase City/Region Date for switchover*

Phase 1

Delhi 31st October 2012

Mumbai 31st October 2012

Kolkata 15th January 2013

Chennai Not completed

Phase II 38 cities in 15 states 31st March 2013

Phase III All remaining urban areas 30th November 2014

Phase IV Rest of India 31st March 2015

Source: Digital Dawn, KPMG Report 2013, Aranca Research

Advantages of Digitisation

Higher consumer preference, which lacked in the former Conditional Access System (CAS)

Consumers will be able to select content of their choice as well as indefinitely store and access digital content

The digital platform in films also includes the ‘video-on-demand’ feature on television

Higher transparency; subscriber declaration level is expected to increase to 100 per cent under post-digitisation regime as

compared to 15–20 per cent as declared by local cable operators (LCOs) to multiple system operators (MSOs)

Stake-holder revenues share Pre-digitisation Post-digitisation

Consumer ARPU 100 100

Local Cable Operators (LCOs) 65–70 35–50

Distributor 5 0–5

Multiple System Operators (MSOs) 15–20 25–30

Broadcaster 10–15 30–35

Average revenue per user per month (USD)


Note: F - Forecast

Presence of analog cable and higher contribution has led to

lower Average Revenue Per User (ARPU) level, which is

around USD3.0 for a digital pay television

However, with higher scope of introduction of new and

niche channels with digitisation, ARPU levels are expected

to increase

3.0 3.1 3.1

3.1 3.1 2.9

3.1

3.3

3.7

4.2

4.6

2011 2012 2013F 2014F 2015F 2016F

Analog Digital


Consolidation will be the major route to grow inorganically

for entertainment companies in order to expand their

portfolios and enter into new regions

A few big deals have come about, the most notable ones

being Walt Disney-UTV and TV18-ETV (together amounting

to around USD700 million)

Mergers and Acquisitions (M&A) deals during 2011-2012

Acquirer Target Deal date Deal value

(USD

million)

Gujarat Telelinks V&S Cable

Private Limited April -2012 -

Educational

Trustee Company

Metronation

Chennai

Television

Mar-2012 3.2

Walt Disney UTV Feb-2012 300

TV18 Eenadu Group Jan 2012 395

Samara Capital Newswire18 Dec-2012 18.8

Blackstone Jagran Media

Network Jul-11 46.9

Cumulative FDI inflows into Information and

Broadcasting from April 2000 (USD billion)

Source: DIPP, Aranca Research

Notes: DIPP - Department of Industrial Policy and Promotion,

FY13* Data from April 2012-February 2013

FDI inflows into the entertainment sector between April

2000 and February 2013 stood at USD3.1 billion

By February 2013, the share of FDI in ‘Information and

Broadcasting’ was 1.6 per cent of total FDI inflows into the

country

Demand growth, supply advantages and policy support are

the key drivers in attracting FDI

0.6

1.3

1.8

2.2

2.9 3.1

FY08 FY09 FY10 FY11 FY12 FY13*

Source: Company Annual Reports, Aranca Research

Television content

Motion pictures

Games content

Broadcasting

Television content

Motion pictures

Games content

Broadcasting

Started as a

content provider

for Doordarshan

Ventured into

internet

content

creation and

aggregation

Launched IPO as

UTV Software

communications

Ltd

Launched

Hungama TV

Disney becomes a

majority share holder

with a stake of 32.1%

Deal with Disney

to dub its content

into Indian

languages

Acquires

Indiagames Ltd,

enters gaming

software and

content

Became world’s

first company to

record over 100

million downloads

on Nokia store

1990 1996 2000 2004 2005 2007 2008 2012

Interactive

Source: Company website, Aranca Research

1985 1993 2000 2003 2005 2007 2008 2012

‘SUN TV’ is

launched with

daily three hours

of programming

Launches SUN

Direct to provide

DTH services

Launches three

pay channels and

four ad-free action

movie channels

Starts its first FM

Channel

‘Sumangali FM’

Direct to Home

Motion pictures

Radio

Newspaper

Magazine

Broadcasting

Founded as

Sumangali

Publications

Launches a slew of

other channels in

various South Indian

languages

Acquires

Dinakaran

newspaper, Tamil

Nadu’s leading

daily

Enters Film

Production and

Distribution

through ‘SUN

Pictures’

Adlabs Imagica


Adlabs Imagica, a flagship project of Adlabs Entertainment

Ltd is a 300-acre entertainment theme park located on the

Mumbai–Pune expressway

It is India's most elaborate theme park for a total value of

USD294 million

The park features 21 attractions including rides, film shows

and live acts drawn from Indian mythology and Bollywood

cinema

The total footfall is expected to be around 2-3 million per

year

SALIENT FEATURES

Total area - 300 acre

Total cost - USD294 million

Visitor capacity - 10,000 to 15,000 visitors per day

Ticket cost - Weekday (USD23) weekends (USD28)

Dish TV revenues (USD million)



Dish TV is Asia's largest and India's first direct-to-home or

commonly known as DTH company

Dish TV India Limited, a division of Zee Network Enterprise

(Essel Group Venture) provides DTH satellite television

Dish TV ranks 5th on the list of media companies in the

Fortune India 500

The company’s revenue rose at a CAGR of 48.3 per cent to

USD423.1 million in FY12 87.4

149.4

233.7

320.9

423.1

FY08 FY09 FY10 FY11 FY12

CAGR: 48.3 %

14.8 16.8

19.4

22.7

26.4

30.5

2012 2013F 2014F 2015F 2016F 2017F

Market size (USD billion)



Over 2012–17, the total market size is expected to expand

at a CAGR of 15.6 per cent to USD30.5 billion

The next five years will see digital technologies increase

their influence across the industry leading to a sea change

in consumer behaviour across all segments

CAGR: 15.6%

Size of major industry segments (USD billion)



Television will continue to be the lead contributor to the

overall industry growth. The segment is estimated to expand

to USD15.6 billion by 2017 (CAGR of 18.5 per cent since

2012)

Radio, Animation & VFX, Gaming and Digital advertising

are emerging as the fast growing segments

During 2012–17, these segments are expected to expand at

a CAGR of:

Digital advertising (41.6 per cent)

Gaming (28.8 per cent)

Radio (21.2 per cent)

Animation (20.1 per cent)

0.0 5.0 10.0 15.0

Music

Radio

Gaming

Out of Home

Digital Advertising

Animation and VFX

Films

Print

Television

2017F 2012

Size of the animation industry in India

(USD million)

Source: KPMG Report 2013, Aranca Research;

Note: F - Forecast VFX - Visual Effects, CAGR - Compound Annual Growth Rate

Animation encompasses three key segments; these are ‘Animation Entertainment’, ‘Visual Effects (VFX)’ and ‘Custom

Content Development‘

India’s animation industry has been growing steadily; from a size of USD355 million in 2007, the sector is forecasted to

post a CAGR of 18.0 per cent to reach USD1.4 billion over 2007–17

Share of sub-segments in India’s

animation industry (2012)

16%

20%

64%

Animation VFX

AnimationEntertainment

Custom ContentDevelopment

0.4 0.4 0.4 0.5

0.6 0.6

0.7 0.9

1.0

1.2

1.3

200

7

200

8

200

9

201

0

201

1

201

2

201

3F

201

4F

201

5F

201

6F

201

7F

CAGR: 14.3%

Source: ‘’Media and Entertainment in India: Digital Road Ahead’ by Deloitte, Aranca Research;

Notes: * We have portrayed the intensity of opportunities in each segment based on the extent

of Indian players’ current presence in that segment

Gaming can be classified under three segments – ‘Personal Computer Games (PC)’, ‘Mobile Games’, ‘Console Games’

and ‘Online Games’

Revenues from Console gaming are expected to reach USD343.8 million by 2017E from USD144.5 million in 2012.

Revenues from Mobile and PC & Digital TV are expected to grow to USD329.1 million and USD96.9 million by 2017 from

USD104.2 million and USD32.9 million, respectively in 2012

Opportunities* for Indian gaming firms across the segment’s value chain

Concept

Creation Pre-production Development

Post- Production

and Testing Final Testing

Console Very Strong Strong Good Good Good

Mobile Good Good Good Good Good

PC Strong Strong Good Good Good

Online Strong Strong Good Good Good

Number of subscribers (Millions)


Note: F - Footnote

The share of digital cable as well as DTH service providers

is expected to increase post-digitisation

Total subscription for DTH is expected to increase to 75

million subscribers by 2016 from 4 million in 2009

Total subscription for DTH is expected to increase to 86

million by 2016 subscribers from 16 million in 2009

69 68 68 59 50 32

12 4

4 5 6 19 32 49

67 75

16 28 37

46 53 64 78 86

6 7

8 8

8 8

8 8

2009 2010 2011 2012F 2013F 2014F 2015F 2016F

Analog Digital DTH DD Direct

Television

• Television is projected to garner a share of 51 per cent in the television pie by 2017 (as

addressable digitisation is expected to cover the entire country by then)

• Television advertisement revenue is also expected to witness robust growth and increase

from USD2.1 billion in 2011 to USD4.2 billion by 2016

Animation

• The Indian animation industry was worth USD650 million in 2012 and is expected to

expand at a CAGR of 15.8 per cent to USD1.4 billion by 2017

• Growth in international animation films, especially 3D productions, and the subsequent

work for Indian production houses will help growth in this segment

Print

• The print industry was worth USD4.1 million in 2012 and is expected to develop at a

CAGR of 8.7 per cent to USD6.3 billion by 2017

• Newspapers and niche magazines are likely to drive industry growth

• Accelerated growth is forecasted in regional print and local news segments



Film

• Size of the Indian film industry is expected to touch USD3.6 billion by 2017, up from

USD2.1 billion in 2012

• Increasing digital screens and 3D films are expected to help industry growth

• Big ticket releases lined up for the next couple of years are also expected to boost

revenues

Radio

• Size of the Indian radio industry is expected to reach USD503 million by 2017, up from

USD234 million in 2012

• Phase III of e-auctions for FM radio licenses will provide an impetus to the segment

• Radio advertising is another area likely to experience accelerated growth

Music

• Size of the music industry is expected to grow to USD413 million by 2017, up from

USD195 million in 2012

• Mobile VAS and arrival of 3G are likely to lead to a surge in paid digital downloads

• Phase III radio licensing will also help in increasing music revenues from radio


Indian Motion Picture Producers’ Association (IMPPA)

"IMPPA HOUSE”, Dr Ambedkar Road, Bandra (West), Mumbai - 400 050

Tel: 91-22-26486344/45/1760

Fax: 91-22-26480757

Website: www.indianmotionpictures.com/imppa/index.html

The Film and Television Producers Guild of India

G-1, Morya House, Veera Industrial Estate,

Off Oshiwara Link Road, Andheri (W), Mumbai - 400 053

Tel: 91-22-66910662

Fax: 91-22-66910661

E-mail: [email protected]

Website: www.filmtvguildindia.org

Newspapers Association of India (NAI)

A -115, Vakil Chamber, Top Floor, Vikas Marg, Shakarpur, Delhi - 110092

Tel: 91-9971847045, 9810226962


Website: www.naiindia.com

Association of Radio Operators for India (AROI)

304, Competent House, F-14, Connaught Place, New Delhi - 110001

Tel: 91- 124-4385887

e-mail: [email protected]

Website: www.aroi.in

The Indian Music Industry (IMI)

Crescent Towers, 7th Floor

B-68, Veera Estate, Off New Link Road, Andheri West, Mumbai - 400 053

Tel: 91-22- 26736301 / 02 / 03

Fax: 91-22-26736304


Website: www.indianmi.org

AGV: Animation, Gaming and VFX

CAGR: Compound Annual Growth Rate

DIPP: Department of Industrial Policy and Promotion, Ministry of Commerce and Industry

DTH: Direct to Home

FDI: Foreign Direct Investment

FM: Frequency Modulation

FY: Indian Financial Year (April to March)

So FY10 implies April 2009 to March 2010

GST: Goods and Service Tax

IPO: Initial Public Offering

M&A: Merger and Acquisition

M&E: Media and Entertainment

PPP: Purchasing Power Parity

USD: US Dollar

Conversion rate used: USD1= INR 54.45

VAS: Value Added Services

VFX: Visual Effects

Wherever applicable, numbers have been rounded off to the nearest whole number

Year INR equivalent of one USD

2004-05 44.95

2005-06 44.28

2006-07 45.28

2007-08 40.24

2008-09 45.91

2009-10 47.41

2010-11 45.57

2011-12 47.94

2012-13 54.31

Exchange Rates (Fiscal Year)

Year INR equivalent of one USD

2005 45.55

2006 44.34

2007 39.45

2008 49.21

2009 46.76

2010 45.32

2011 45.64

2012 54.69

2013 54.45

Exchange Rates (Calendar Year)

Average for the year

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