Professional Documents
Culture Documents
136
Introduction
The rapid growth in the Indian Media and Entertainment economy has the world
talking. Boasting of the worlds youngest population, besides being home to a
massive demographic footprint of more than 1.2 Billion, India is the haven for new
technologies, consumer media and expansion in communication. Complimenting
these numbers is the growing propensity to spend among the population that
doesnt shy away from pouring in the moolah for entertainment consumption.
Enamored by this promise of exponential growth and demand, global media houses
have already locked India into their growth and investment cycles for the near
future. The growing middle class has ensured that foreign investment in the media
industry is consistent as well sustainable.
As is around the world, the Indian media today is facing a brand new inflection
point, an opportunity to adapt and expand as well as a challenge to stay relevant
the growth and growth of Digital Media. Going only by the humungous scale of the
Indian mobile phone user base more than 750 million and that too further
injected with the mass adoption of 3G and 4G, the potential in digital content
creation, packaging and distribution in the country is massive. Thus, avoiding or
ignoring the new face of multi-platform media networks is only bound to be suicidal
for any big or small media provider. And this is exactly where the more than
substantial amount of positive network externality kicks in to supplement this
transition. With increasing number of people consuming news, entertainment as
well as educational media through digital and mobile platforms, the value to
advertisers and subsequently media houses to move towards more robust and
responsive, digital mass media is growing at an exponential pace. Thus, to say the
least the transcend of digital content and platforms has radically redefined the
desirable business models and has spurred and thrown the Indian M&E players into
a lookout for global partners, be it for technology upgradation, knowledge and
content sharing or foreign investments.
Looking at the key drivers for the growth in the sector, we cannot ignore the large
pool of opportunities available for media businesses stemming from the low media
penetration in the country at the moment. An Ernst & Young report published in
2010 shows an 11% increase in household income in the Top 20 largest cities of the
nation in the 2004 2008 period. This growth is unprecedented shall certainly drive
advertising spends in India, that are currently substantially low when pitted against
the world average Indias advertising spend to GDP ratio stands at 0.34% as
compared to a world average of 0.75% (2011).
Business strategies are also bound to change with the ever increasing internet
penetration in India. As is the case with media penetration, internet penetration in
India is also extremely low 7% compared to 34% in China and 31% in Brazil. Thus,
the media houses and conglomerates that can capitalize on this growth of internet
penetration are the ones that will be able to sustain media businesses. This
broadcasting rights has further boosted the film revenues. This has further been
supplemented by the large scale funding and investments in the film industry from
global media houses, as well as the rise in outsourcing of movie production by
Indian filmmakers to improve content and reduce setup and talent costs.
Conclusion
The growing middle class, high incomes and increasing consumption of content
holds unprecedented potential for media businesses. Adoption of digital thus, offers
both challenges to adapt as well as opportunities for those who are ready to
embrace the change. Thus, the only way to succeed for Indian as well as global
media players in India would be to understand and adapt to this dynamic but
wonderful ecosystem that is India. Theres fraud, corruption, inconsistencies,
politics as well as unpredictability that surrounds the industry today, but the fruit
that lies exposed to the ones that are convinced and determined to grow their
businesses here, is sweeter than any other part of the world today.