Global entertainment and media revenue rose to $ 2.3 trillion; virtual reality sees 36% growth as games and eSports are on the verge of becoming a $ 324 billion business: PwC

NEW YORK, June 22, 2022 / PRNewswire /The global entertainment and media industry (E&M) was ahead of last year, well ahead of overall global economic growth. After a pandemic-related decline of 2.3% in 2020, E&M revenues grew by a strong 10.4% in 2021, from 2.12 trillion to 2.34 trillion. As the industry becomes more digital, more mobile and youth-oriented, virtual reality (VR) and games are powerful drivers of growth, while digital advertising is penetrating the entire industry. These are findings from Global Perspective on Entertainment and Media at PwC 2022-202623rdrd annual analysis and forecast of E&M costs by users and advertisers in 52 countries and territories.

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Findings in this year’s perspective include:

  • Global revenue from video games and eSports is total $ 215.6 billion in 2021 and is expected to increase by 8.5% CAGR to $ 323.5 billion in 2026 Asia-Pacific region generates the lion’s share of revenue in 2021 s $ 109.4 billionalmost double North America, the second highest region. Games are now the third largest category of E&M data-consuming content, after video and communications.

  • VR continues to be the fastest growing segment of E&M, albeit from a relatively small base. Global VR spending increased by 36% year on year in 2021 $ 2.6 billionafter the hot growth of 39% in 2020. Growth between 2021 and 2026 is expected to be 24% CAGR, which will lead the segment to $ 7.6 billion. The content of the games is the main contributing factor to VR revenue $ 1.9 billion in 2021. This should increase to $ 6.5 billion in 2026, 85% of total VR revenue.

  • The spread of advertising in the digital world has made it the dominant industrial category. After a decline of nearly 7% in 2020, advertising grew by an impressive 22.6% in 2021. $ 747.2 billion. Driven almost entirely by digital advertising, it is expected to grow by 6.6% CAGR by 2026. Revenues from online advertising are expected to grow even faster, growing by 9.1% CAGR. In 2026, advertising is projected to be a $ 1 trillion market and the largest revenue stream from E&M, surpassing consumer spending and Internet access.

  • After growing by 35.4% in 2020, Over-the-top (OTT) video grew by another 22.8% in 2021, pushing revenue to $ 79.1 billion. The growth rate of OTT revenues will slow down somewhat; is expected to increase by 7.6% CAGR by 2026, which will lead to $ 114.1 billion.

  • Traditional television, hit by competition from OTT streaming services, is still generating significant revenue, but its relentless decline will continue, with global revenue expected to shrink by -0.8% CAGR from $ 231 billion in 2021 to $ 222.1 billion in 2026

  • Global cinema revenues are recovering, reversing the losses caused by the pandemic, and are expected to reach a new peak by $ 46.4 billion in 2023. Revenues from the box office are expected to reach $ 49.4 billion in 2026 from $ 20.8 billion in 2021, 18.9% CAGR. China surpassed the United States to become the world’s largest film market in 2020 and is expected to maintain that leadership until 2026.

  • Live music revenue is projected to exceed pre-pandemic levels in 2024. Digital music streaming subscriptions are boosting growth in the recorded music sector, where revenue is expected to rise from $ 36.1 billion in 2021 to $ 45.8 billion in 2026

  • Content growth fuels huge data consumption – 2.6 million petabytes (PB) of data were consumed in 2021 and is expected to increase 26% CAGR to reach 8.1 million PB by 2026. Games will be the most -the fastest growing user data over the forecast period, with an expected CAGR of 29.6%. Mobile phones will be the fastest growing category of devices between 2021 and 2026, growing by 28.8% CAGR and is expected to increase mobile data consumption from 1.1 million PB to 3.8 million PB.

Werner BalhouseThe global leader in the entertainment and media industry, PwC Germany, said: “The industrial press tends to focus on companies that have dominated the E&M industry. But the choices billions of consumers make about where to invest their time, attention and money are fueling the transformation of the industry and driving trends. We are seeing the emergence of E&M’s global consumer base in the coming years, which is younger, more digital and more in streaming and gaming than the current consumer population. That is shaping the future of the industry. “

North America E&M per capita dominates, but faster growth is elsewhere

At regional level, North America has by far the highest cost of E&M per capita, at $ 2229almost double Western Europe $ 1,158. In contrast, Asia-Pacific regionwhich was E & M’s largest revenue region in 2021 $ 844.7 billionthere are costs per capita $ 224. IN Middle East and Africa have the lowest E&M costs per capita in each region worldwide, c $ 82.

Meanwhile, the CAGR’s ten emerging markets are focused on Latin America, Middle East, Africa and Asiasuch as OTT video and games provide the bulk of revenue growth, and eSports and cinema are also growing rapidly. Turkey (approximately 14.2% CAGR), Argentina (10.4%), India (9.1%) and Nigeria (8.8%) are in first place for the growth prospects of E&M’s consumer spending over the five-year forecast period.

The metaverse is waiting

In the not-too-distant future, the metaverse could become a stunningly realistic world where people have access to immersive virtual experiences through VR headphones or other connectivity devices. Because the metaverse is an evolution that can profoundly change the way businesses and consumers interact with products, services, and each other, its potential financial and economic value exceeds VR. Over time, much of the revenue from video games, music performances, advertising and even e-commerce could migrate to the metaverse.

How big is the opportunity for E&M in the metaverse? The fast-growing VR market is a starting point to consider. This is currently one of the smaller segments tracked, but a 36% increase in global spending over the past year is a hint at its long-term potential. The global installed base of standalone and connected VR headsets is expected to grow 21.6 m in 2021 to 65.9 m in 2026

CJ Bangah, director of technology, media and telecommunications, PwC United States, said: “Coming out of the pandemic, we are seeing a strong recovery in key sectors. This has created a new growth platform for entertainment and media that are heading for a turbulent future with lines of fault, breakage and new revenue opportunities dotting the landscape. As we enter the 23rd fiscal year and beyond, we expect to see continued growth in digital and digital content and media experiences alone, games to become the new battleground for consumer entertainment, and content and streaming to transform from market and consumer. dynamics. “

For Global Entertainment & Media Outlook 2022-2026

PwC Global Entertainment & Media Outlook, with the accompanying publication Faults and Fractures: Innovation and Growth in a New Competitive Landscape, provides an in-depth analysis of global consumer and advertising costs for E&M. The forecast includes five-year historical and five-year forecast data and comments for 16 industrial segments in 52 territories. The segments include advertising (television, internet, away from home); books; business to business; movies; data consumption; Internet access; music, radio and podcasts; newspapers and consumer magazines; OTT video; Television and home video; as well as Metaverse and NFT, included for the first time this year.

About PwC

At PwC, our goal is to build trust in society and solve important problems. We are a network of companies in 156 countries with over 295,000 people committed to providing quality insurance, consulting and tax services. Learn more and tell us what is important to you by visiting us at www.pwc.com.

PwC refers to the PwC network and / or one or more of its members, each of which is a separate legal entity. Please see www.pwc.com/structure for more details.

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