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    Home » News » Entertainment, media industry recovering

    Entertainment, media industry recovering

    By Editor14 October 2010
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    The cover of the new PwC report

    SA’s entertainment and media industry is recovering from the economic downturn, according to a report released on Thursday.

    PwC’s entertainment and media report says total entertainment and media spending grew 1,8% in 2009, in contrast to the 1,8% decline globally, but this was down from the 8,5% growth seen in 2008.

    “Globally, the speed at which consumers have transitioned to digital has accelerated beyond expectations.

    “While spending on digital media in SA is expected to grow, it is unlikely that it will dominate in the forecast period,” the report said.

    Non-digital revenue streams were expected to be much higher and would still account for 69,1% of total SA spending in 2014.

    “Appropriately, forward-thinking entertainment and media companies will use digital technologies to generate revenue while still supporting their non-digital offerings in set markets,” the report said.

    Advertising fell 14,3% as the full effect of the recession hit in 2009.

    However, consumer/end-user spending countered this effect with a booming box office market, continued growth in TV subscription spending and a jump in broadband spending.

    “Even with a surge in the number of households using broadband, the Internet market in SA is still in its developmental stage.”

    Less than 10% of households had a broadband connection in 2009 but this was expected to quadruple over the next five years.

    There were more than 1,3m mobile broadband users in 2009, compared to 800 000 fixed broadband users.

    When including the 3,2m dial-up users, the total number of Internet users was only 5,3m, the report said.

    “Mobile broadband will be the fastest-growing technology over the next five years, with an expected increase of 50,7% or 10,1m users by 2014.”

    The report showed that by 2014, 72% of broadband users would access the Internet through mobile devices and 63% of all Internet users would access it through mobile devices.

    Videogames enjoyed a 13,4% growth in 2009, second only to the Internet which witnessed a 29,8% increase in the same period.

    Sports revenue increased 5,8% in 2009, aided by new tournaments, merchandising and growing interest in the sponsorship market.

    According to the report, new technology such as mobile broadcasting would see new competitors enter the market which would generate an additional advertising stream, projected to reach R15m by 2014.

    Broadcasting in SA was highly regulated and outlets were limited, the report found.

    “There are four free-to-air channels and two pay television providers that operate a terrestrial pay channel and a digital satellite network.

    “The three SABC channels account for more than two-thirds of the television audience, and free-to-air broadcasting generates 90% of total viewing.”

    The report predicted that public TV licence fees would increase by 0,9% compounded annually from R1,02bn in 2009 to R1,07bn in 2014.

    Broadcast advertising would expand at a 9,6% compound annual rate during the next five years to R11,9bn in 2014, from R7,5bn in 2009.  — Sapa

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