Category Attractiveness of Media Segment

8/9/2019 Category Attractiveness of Media Segment

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Category Attractiveness of

Media Segment


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OVERVIEW

The Indian Media and Entertainment (M&E) industryAnnual revenue US$ 12.9 billion in 2009

Growth rate 1.4 per cent growth over last year. Over the next five years, the industry is projected to grow

at a compound annual growth rate (CAGR) of 13 percent Gaming segment is expected to be a fast growing sector

in the M&E industry. The sector showed a 22 per cent growth in 2009 and is

expected to grow at a CAGR of 32 per cent to reach US$705.2 million by 2014, Animation segment is expected to record a CAGR of

18.7 per cent in the next five years as per the jointreport.


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Indian Media & Entertainment

Industry - Zooming aheadMaximum growth expected in Television and Film

segmentsMore than 300 national and regional TV channels

Close to 1000 films made every year

Liberal FDI policies across all the segments of theindustry

Government focusing on regulations to give furtherimpetus to the industry.


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MEDIA

MAGAZINE TELEVISION RADIO

ELECTRONICPRINT

NEWSPAPE

R

INTERNET


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KEY PLAYERS- INDIANTELEVISION

Largest TV network with 19 channels reaching 90% of thepopulation

Entered in 1991 and offers a large number of channels in massentertainment, sports, news,, music, movies etc.

Pioneers of the Indian Television industry with 22channels. It is present in broadcasting, cable distribution,production and distribution of films, creation ofanimation software

Present with 3 channels focusing on Hindi entertainmentand sports

Based in SouthIndia with 14 channels in four languages and offersnews, movies, music, kids shows.

Present in India through two kids channels and has recentlybought one more kids channel


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Print Media

Current size: Rs 10,900 crore

Growth rate:12%Projected size by 2010: Rs 19,500 crore

With the literate population on the rise,more people in rural and urban areas arereading newspapers and magazines today


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Electronic Media

News Channels

Continues to grow at 8-10 per cent annually

About 10-12 per cent of total advertising moneyspent on television goes to news channels.

In 2007 news channels generate about Rs 7

billion in advertising revenues, compared to Rs6.2 billion in 2006


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Radio

Annual revenues US$ 49.5 million

Growth rate around 20 percent annually

Radio is expected to grow at a CAGR of 16 per cent over2010-14 and reach to a size of US$ 361.4 million by2014.

Advertising

Annual revenue US$ 5.2 billion

Growth rate (CAGR) of 14 per cent in 2010, incomparison to the last year. KPMG observed that onlineadvertising will grow about 30 per cent per annum


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Music

Annual revenue US$ 182.9 million in

2010, Growth rate 14 per cent

It is expected to grow at a CAGR of 16

per cent over 2010-14 to reach US$ 379.1million.


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PESTEL analysis

Political

Increased political interest due to contribution to economic gowth

Policy stage Changes of administration or political principles . Liberaloutlook

Economic

Improved growth in the industry, attributed to India positive economicgrowth

The growth of the industry expected to grow by 16% in the currentyear.

Improved competition in other sectors


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Social aspect

Major influence

Large segments to cater to .

Globalization a major tool for success.

Positive outlook for the traditional and conservative audiences

Technological advances

Modern information technological advancement resulted in fast gowth

Technological advancement resulted in increased spending and research forinnovation

Legal environment

The media industry not highly regulated .

Laws and regulations which are enforced for the industry to comply.

The government recently reduced laws so as not to hinder competition in theface of increasing global challenges from the external markets.

Legislations such as anti-piracy laws have been enacted and the governmenttries to enforce the fully even though it is difficult


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Porters five forces

Barrier to entry: Moderate, legislations and cost of research and development

Industry competition: High, advantage gained through technology andmarketing strategies

Bargaining power ofSuppliers: Supplier power is high. Not attractive

Bargaining power ofBuyers: Buyer power is low.

Substitutes: Low


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Porters five forces

Bargaining Power of Consumer (High)Consumer can switch channelsIncreased globalizationAvailability of a variety of alternative sources ofentertainment

Threat of New Entrants (Low)High sunk costs

High capital requirementDifficult access to distributionSteeper learning curve because of mature market


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Competitiveness within the Industry (High)

Highly Fragmented Industry

High Fixed CostHighly perishable productsHighly diversified rivals

Bargaining Power of Suppliers (Low)

Decreasing bargaining power of suppliers

Increasing number of content providers


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Threat of Substitutes

Film Industry

Significant sporting events like World CupsSignificant cultural eventsPrint mediaInternet


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Category Attractiveness of Media Segment