The Indian M&E industry is on the road to recovery but still must overcome its pre-pandemic levels. While 2020 saw demand patterns shift as consumers actively sought alternatives, 2021 saw Indian consumers being influential in determining the production of content and experience, time and place of delivery of content, and ways of marketing it. The increased digital media consumption has given more choice and power, and Indian customers have enthusiastically embraced it. This has resulted in M&E companies re-thinking their business models across their core areas – content, distribution, transaction and consumer.
Animation, VFX, and post-production was the fastest-growing category as content production resumed for television, OTT, and film. While the implementation of the government’s AVGC policy is critical for the segment to achieve its potential, the key risk factor is the availability of quality talent, for which much needs to be done around training and upskilling.
All M&E segments grew in 2021 except for in-cinema advertising and TV subscription. Video remained the largest earning segment in 2021 as work-from-home and school-from-home remained significant for most Indians. Compared to 2019, 52% of consumers spent more-time streaming entertainment content in 2021, making this growth the third highest in the world.
Key trends in 2021
- Digital advertising – Digital advertising increased by 29% to INR246 billion. In addition, SME and long-tail advertisers spent INR117 billion on advertising.
- Digital subscription – Digital subscription also grew 29% to reach INR56 billion. Due to the abundance of free audio options, just three million people purchased music subscriptions, producing INR1.6 billion in revenue.
- Print – Advertising revenues grew 24% in 2021, though ad rates remained subdued.
- Animation and VFX – At 57%, this category was the fastest-growing segment in 2021. As content production resumed, service exports increased, and the industry adopted virtual production.
- Online gaming – From 360 million in 2020 to 390 million in 2021, the number of online gamers has increased by 8%. Over 70% of the segment's revenue came from real money gaming.
- Film – Despite capacity restrictions during the year, over 750 films were released in 2021, as compared to just 441 releases in 2020. Over 100 films released directly on streaming platforms, too.
- Live events – While the category rose 20% owing to the relaxation of event restrictions, revenues were only 40% of 2019 revenues.
- Television – Television advertising grew 25% to end 2021 just 2% short of 2019 levels. Subscription revenue continued to fall for the second year in a row.
- OOH – OOH media grew 27% but remained at 50% of 2019 levels. We expect it to regain 2019 levels not before 2024.