Entertainment & Media: An Unfolding Opportunity

Entertainment & Media
An Unfolding Opportunity
July 2005
India - An Overview
Market and Growth Potential Players Opportunities Why India? Contact in India
July 2005

Population States/UTs Geographical Area Languages recognized
Over 1 bn
35
3.3 mn sq kms
22
Business language
Per Capita Income**
**(at factor cost & at current prices) 1USD=43.54 INR (as on July 4, 2005)
July 2005
English
US$ 534
GDP**
US$ 650 bn
India - Fast pace Growth

Largest democracy 4th largest economy by PPP index 6th largest energy consumer For Ex reserves skyrocket from US$ 42 bn (2001) to
US$ 133 bn (February, 2005)

GDP growth to continue between 6-8% 3rd largest economy by 2050: Goldman Sachs Leading in IT & BPO Oil & Gas and Biotechnology sunrise industries
July 2005
India - Leading the world

Hero Honda - largest manufacturer of motorcycles Moser Baer - among the top three media manufacturers
in the world
Pharmaceutical Industry - 4th largest in world Walmart, GAP, Hilfiger sources more than USD 1bn worth apparel from India 100 Fortune 500 have set R&D facilities in India
including GE, Delphi, Eli Lilly, HP, Heinz and Daimler

Chrysler
July 2005
India - An Overview
July 2005
The Entertainment & Media Industry

One of the fastest growing sectors of the Indian economy
Size Estimated growth rate over next 5 years
US$6900 mn
14% CAGR
July 2005
Key Institutional Framework
Ministry of Information & Broadcasting
Films Wing
Directorate of Film Festivals National Film Development Corpn Central Board of Film Certification
Broadcasting Wing
Prasar Bharti
Information Wing
Press Council of India
o
AIR o Doordarshan
Information Bureau
Press
July 2005
Constituents
In d ia n E n te rta in m e n t & M e d ia C o n s titu en ts -2 0 0 4
F ilm s 18% R a d io 1% TV 4 1%
P rin t 38% M u s ic 2%
July 2005
The Changing Face

E&M Sector Films Television Radio Media Music
Content
Commercial (Hindi & Regional) Cinema Art Movies Cartoon Movies
Commissioned Programs News & Current Affairs
Commissioned Programs News & Current Affairs
News & Current Affairs Fiction/Non Fiction Articles
Film Music Private Albums
Delivery
Cinema Halls Home Videos (Video Cassettes, VCDs, DVDs,)
Mobile Phones
Cable Terrestrial DTH
Public Broadcaster FM Channels
Internet
Newspapers Magazines Books
Cassettes CDs
---------- Straight line denotes Traditional Delivery Mechanisms Source:PwC Analysis

July 2005
- - - - Dotted line denotes Converged Delivery Mechanisms
Filmed Entertainment
Revenue Growth of Indian Film Industry 3,500 USD Mn 3,000 2,500 2,000 1,500 1,000 500 2004 2005 2006 2007 2008 2009
Source: Industry estimates & PwC Analysis
2,872 2,434 2,063 1,256 1,482 1,748
Current Size Estimated growth rate over next 5 years

July 2005
US$ 1256 mn 18% CAGR
Filmed Entertainment-Key Growth Drivers

Emergence of crossover films
High Return on investment immense international appeal low costs of production
In 2004 alone, estimated five Bollywood releases generated more than US$ 2 million each in the UK and US.
July 2005
Filmed Entertainment-Key Growth Drivers

Increasing importance of regional cinema International cinema dubbed in Indian languages Growth of multiplexes Growth in cinema advertising Merchandising/Promotional Material Revenues
July 2005
Television
India Third largest television market in the world Estimated growth rate of TV industry on an overall basis for next 5 years 18% CAGR
Total No. of TV households
over 119 mn
Total No. of TV channels over 350

July 2005
Television Industry- Revenues

TV Industry Revenue Break-up
7,000 6,556 6,000 5,000 5,330 4,421 4,000 3,000 2,000 1,000 2004 2,860 1,667 1,067 127 2005 3,237 2,668 1,900 1,195 142 2006 2,223 1,362 162 2007 1,566 188 2008 1,801 2,089 3,747 3,308 Total TV 4,201 TV Subscription TV Advertising TV Softw are
USD Million
221 2009
266

July 2005
Television-Key Growth Drivers

Pay Revenues - primary growth driver for subscription revenues Growth in number of TV households Low penetration of multi-channel colour TVs in rural areas Growth in the television software segment
July 2005
Music Industry
Revenues of Indian Music Industry

175 170 168 163 158 153 149 165 160 155 150 145 140 135 2004E 2005F 2006F 2007F 2008F 2009F 173
US$ million

July 2005
F- Forecast;E-Estimate
Music Industry- Key Growth Drivers
Growth in non-film albums and music videos
Talent Nurturing
FM radio synergies Shortening shelf life of music Organised music retailing Unbundling of the album concept
Product expansion
Overseas potential
July 2005
Radio Industry
Radio Industry Revenues

160 140 120 100 80 60 40 20 0 2004E 2005F 2006F 2007F 2008F 2009F 53 61 72 113 90 144

July 2005
US$ million
Radio Industry-Key Growth Drivers
Local Advertising Lower share of Adspend Satellite Radio Community Radio
July 2005
Print Media
Total Print Media Industry - Revenues
4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0
US$ million
238
254
269
285
300
315
2,369
2,524
2,680
2,840
3,005
3,171
2004E
2005F
2006F Newspaper
2007F Magazine
2008F
2009F
Source: Industry Estimates & PwC Analysis

July 2005
Newspaper Industry
Total Newspaper Industry

3500 3000
US$ million
2500 2000 1500 1000 500 0 2004E 2005F 2006F 2007F 2008F 926 1,004 1,081 1,160 1,242 1,443 1,520 1,599 1,680 1,763
1,848
1,323
2009F
Advertisements
July 2005
Subscriptions
Magazine Industry
Total Magazine Industry

350 300
US$ million
250 200 150 100 50 0 2004E 2005F 170 183 68 71
73
75
77
79
196
210
223
236
2006F Advertising
2007F
2008F
2009F
Subscriptions

July 2005
Newspaper and Magazine Publishing Industry Key Growth Drivers

Booming Indian economy Content Government initiatives Emerging Digital Technologies
July 2005
India - An Overview
July 2005
Indian Film Industry

Players Zee Telefilms Adlabs Films AVM Productions Mukta Arts Rajshri Productions Shringar Group Production a a a a a X Distribution a a a a a a Exhibition a a a X X a
PVR Cinemas
Pritish Nandy Communications
July 2005
a Present
X
a
a
a
a
X
Not present
Indian Television Industry

Key Players CNBC-TV 18 Discovery ESPN Star Sports Hathway Cable MTV India STAR India TEN Sports India
Walt Disney
Turner International
July 2005
Indian Television Industry

Key Players Doordarshan Balaji Telefilms Eenadu TV NDTV Nimbus Padmalaya
July 2005
Sahara India Sony Entertainment
Sun Television
UTV Software
Zee Telefilms Limited
Indian Music Industry

Key Players Universal Music India Saregama India (HMV) Venus Records Sony Music Entertainment BMG Crescendo Virgin Records
Magnasound
July 2005
Radio
All India Radio (AIR) Planned, developed & operated by Ministry of I & B. Network of 214 broadcasting centres covering 24 languages covering 91.37% of the area serving 99.13% of the Indian populace Private FM Broadcasters Entertainment Network India Radio Today Radio City Radio Mid Day West India FM Radio
July 2005
Print Media
Key Players
Newspapers Times of India Hindustan Times The Hindu The Telegraph Indian Express Mid-Day
July 2005
Magazines India Today Readers Digest Outlook Femina Filmfare Stardust
India - An Overview
July 2005
Cable TV Households- untapped potential

Low Cable penetration levels indicate huge untapped potential Rural areas to spur growth
Total No. of Households 200 Million

TV Households 119 Million
Cable TV Households 50 Million
Source: Industry Estimates & PwC Research July 2005
Television
Television Subscription Current size Television Advertising Current size
T V A d v e rtis in g - re v e n u e s
2500 2089 2000 1801 1566 1500 1067 1000 500 0 2004E 2005F 2006F 2007F 20 0 8 F 2009F 1362 1195
US$ 1667 mn
US$ 1067 mn
Source: Industry Estimates & PwC Research July 2005
US$ m illion
Growth of multiplexes
Platform to screen movies
appealing to niche audience

Have brought back Indian film
viewers to movie halls

Smaller screening options
July 2005
India - An Overview
July 2005
The India Advantage
Expanding Indian Economy Strong job creation in new economy sectors
Demographic Advantage 30 to 40 million people joining middle class every year

Change in consumer mindset due to global exposure
Untapped rural potential

July 2005
The Policy Advantage

Key Government Initiatives
2001 2001 Industry status to Films Announcement of DTH guidelines
2004
Announcement of Broadband Policy
Reduction in import duties
Move towards Co - production treaties

July 2005
Enforcement efforts against music pirates
1,600,000
Number of Seizures
1,475,632
Number of raids conducted

1000 800 600 400 200 0 North Zone West Zone East Zone South Zone 2003 2004
Source: Indian Music Industry
1,400,000 1,200,000 1,000,000
844 702 436 338
Units
884,418
401 308 96 171
800,000 600,000 400,000 200,000 0 Music Cassettes CDs

351,790 221,002
July 2005
FDI Policy
Advertising & Film Sector Upto 100% on automatic route Print Media - Upto 74% in Indian entities publishing scientific/ technical & speciality magazines/periodicals/journals - Upto 26% in Indian entities publishing news & current affairs newspapers & periodicals
Broadcasting Sector No restriction on foreign equity in proposals related to software production, marketing of TV rights, air times, advertisements etc.
July 2005
India - An Overview
July 2005
Contact in India
Office of the Minister for Information & Broadcasting Shastri Bhawan New Delhi 110 001
Tel Fax
0091 11 2338 4782/2338 4340 0091 11 2378 2118
July 2005
Contact in India
Secretary, Ministry for Information & Broadcasting R.No. 655, A Wing, Shastri Bhawan New Delhi 110 001 Tel Fax 0091 11 2338 2639 0091 11 2338 3513
July 2005
Contact in India
Confederation of Indian Industry (CII) The Mantosh Sondhi Centre 23, Institutional Area Lodi Road New Delhi 110003 India Tel: + 91 11 2462 9994-97 Fax:+ 91 112461 5693 Email: c.banerjee@ciionline.org
July 2005

Entertainment & Media: An Unfolding Opportunity

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