Video streaming and spending on internet advertising will help drive growth in the UK entertainment and media sector to the tune of £10 billion (€11 billion) over the next five, years, according to PricewaterhouseCoopers’ Global Entertainment & Media Outlook report.
According to the 2019-23 Outlook report, the UK media and entertainment sector will be worth £80 billion by 2023, up from the £70 billion projected for this year.
Overall, the UK’s entertainment and media sector will grow at a pace of 3.5% per annum and will only be second to Germany in total revenue within Western Europe, according to PwC.
Internet advertising is forecast to account for a quarter of all entertainment and media revenue by 2023, generating £20 billion in revenue up from £15 billion this year, growing at a 9% compound annual growth rate.
Mobile will continue to drive growth and by the end of 2023, revenue from mobile advertising will be more than double – £14 billion – that of traditional internet advertising – £6.3 billion – and account for nearly three quarters of all internet advertising, according to the report.
Virtual reality leads as the fastest growing sector for the third year running, with 20% CAGR forecast over the next four years. While VR gaming leads the way in revenue, VR video is the fastest growing sub-sector and will contribute to the industry as a whole being worth £294 million by 2023.
Over-the-top video is also forecast for double-digit growth – at 10.3% – with demand for video streaming services set to continue upwards. Subscription video on demand revenue is set to grow from over £900 million this year to over £1.4 billion in the next five years.
“The industry is underpinned by consumer demand for new, high quality content, that is accessible and highly personalisable. Innovation from key industry players (in terms of platforms, technology and business models) continues to stimulate demand. The UK remains a leading market in terms of talent, reputation and innovation, and has seen significant levels of financial investment as a result. All of these factors combined mean that we expect the UK entertainment and media market to continue to grow ahead of the wider economy, at 3.5% p.a. over the next five years,” said Mark Maitland, UK head of entertainment and media at PwC.
“The UK telecoms market is one of the largest in Western Europe, with intense competition in both the mobile and fixed sectors. Following the award of the first UK 5G spectrum in April last year operators are expected to launch services this year which will increase speeds for smartphone users. Across all devices video is the fastest-growing content type, increasing at a 22% CAGR. Video accounts for 84% of data consumption across devices in 2018, and this is expected to increase to 89% in 2023.”
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