The Indian Media and Entertainment (M&E) sector grew 20% in 2022 to cross more than Rs 2 lakh crore (USD 26.2 billion), 5% above its pre-pandemic 2019 levels, according to a report released by the Ministry of Information and Broadcasting (MIB) recently.

While television remains the largest segment (followed by digital and Print), TV continues to bleed subscribers as the media consumption pattern and choice of platforms among Indians have changed drastically in the last few years. 

Not surprising then that the TV industry's revenue shrank from Rs 72,000 Cr to Rs 70,900 Cr between 2021 and 2022. It was Rs 78,700 Cr before the Covid pandemic 2019 but dropped to Rs 68,500 Cr in 2020, as per the ministry’s latest statistical book on the M&E sector based on EY estimates.

Digital media, on the other hand, grew the most. From Rs 30,800 Cr in 2019, digital's revenue grew consistently and reached almost double-Rs 57,100 Cr-in 2022. It has also expanded its share in the M&E sector from 16% to 27% between 2019 to 2022.

If data charges associated with digital consumption are also included, digital's share would stand at 50% in the total M&E, an EY report stated.

Nevertheless, the TV sector is set to grow at the compound annual growth rate (CAGR) of 3.9 percent by 2025. However, Digital has the highest projected growth rate (14.7 percent) across media sectors.

Overall, half the sector's growth was driven by traditional media (TV, print, radio and OOH) and the rest by digital, online gaming and animation and VFX.

Gaming blue-eyed boy

Online gaming is one of the fastest growing consumer internet businesses in India with nearly 600 million consumers. The revenue of the sector has gone more than double, from Rs 6,500 Cr to Rs 13,500 Cr, between 2019-2022. It is set to further grow at 9.8 percent CAGR till 2025, MIB predicts. 

It's noteworthy that on October 1 India implemented a 28% Goods and Services Tax (from 18% to 28%) rate on online gaming, casinos, and horse racing retrospectively from 2017 onwards. 

Hefty tax demand notices have been served to prominent players like Dream11, Games 24x7 and its affiliates, and Head Digital Works. The total GST demand raised by the government from Real Money Gaming companies might touch Rs 1 lakh crore, as per industry executives.

The real money gaming ecosystem accounts for 3/4 of the total gaming sector revenue as per a FICCI-EY report.

Print and OOH

The report also shares a glimpse on how print media and Out-of-Home (OOH) have bounced back with over 25% and 50% increase respectively in terms of taxes. Taxes of both the sectors are predicted to grow by 3.7 % and 12.8% respectively in the next three years. 

As per a recent report from Crisil, the print media revenue will grow between 13 per cent and 15 per cent to Rs 30,000 cr this year on the back of higher ad spends by the government and corporates in the five election-bound states that will go to poll this November. The government coffers will surely go richer in 2023.  

Radio industry set to grow

The Radio industry, which was heavily affected by Covid-19, is battling challenges in the face of on-demand streaming platforms and a series of systematic problems. The sector and its taxes to the government have not even touched its pre-COVID levels yet, MIB report indicates. 

The report predicts that the taxes from the sector will grow at a CAGR of 7.5 percent. However, it may go up if the Telecom Regulatory Authority of India (TRAI) has its way. The TRAI has recently advised MIB to allow private FM radio channels to broadcast independent news and current affairs programmes, with a limit of 10 minutes per hour. 

It is believed that the move to broadcast news will help create an upswing for private Radio operators. Currently, private FM radio operators can only broadcast All India Radio’s (AIR) news bulletins without any alterations.