Accounting firm PwC recently released its annual media and entertainment report, offering insights and predictions for industry leaders. The report covers the years 2023-2027 and provides forecasts for the growth of the overall media and entertainment industry, including specific sectors such as cinema, TV advertising, streaming, music, radio, podcasting, gaming, esports, newspapers, magazines, books, internet advertising, VR/AR, NFTs, and the metaverse.
According to PwC’s forecasts, the global music, radio, and podcasting industry will experience a compound annual growth rate of 2.7 percent from 2022 to 2027. Revenue is expected to rise from $104.4 billion in 2022 to $120.6 billion in 2027. While radio may see a slight decline, digital music streaming is projected to grow at a compound annual rate of 11.6 percent, with recorded music and live music both experiencing increases of 6.5 percent and 2.0 percent, respectively. Furthermore, podcast advertising is expected to have a compound annual growth rate of 11.8 percent.
In an interview with PwC principal CJ Bangah, The Hollywood Reporter discussed the key trends in the music and audio space. Bangah highlighted the ongoing growth of live events and streaming in the music industry. Despite recent layoffs in some music streaming services, podcast advertising has shown incredible growth. Podcasts offer a unique opportunity for close consumer engagement, as listeners often develop a personal connection with the hosts. The introduction of dynamically inserted ads has also contributed to the growth of podcast advertising. PwC remains optimistic about the future of the music industry, with the return of live events and continued growth in streaming.
PwC’s report also forecasts healthy growth in the global gaming and esports sector. Revenue is expected to increase from $214.5 billion in 2022 to $314.6 billion in 2027. This growth is driven by a more diverse and older gamer demographic, as well as the popularity of mobile games and social games. Social media platforms have played a significant role in attracting new gamers and creating a sense of community. Esports, in particular, has contributed to the growth of gaming, as it allows non-gamers to watch others play and feel more comfortable entering the gaming world. Advertising has further fueled the growth of gaming, making it accessible to a wider audience. PwC predicts the esports market to reach $3 billion in revenue by 2027.
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Another topic addressed in the report is the role of artificial intelligence (AI) in the entertainment and media industry. PwC acknowledges the potential disruptive and transformative impact of AI, particularly in areas such as search advertising and video games. AI assistants may replace traditional search engines as a means of discovering new content, while AI technology can enhance the development of non-player characters in video games. The report emphasizes that AI will disrupt and change the cost and revenue implications of the industry. However, there are various challenges to consider, including job displacement, employee experience, and ethical concerns. PwC continues to explore the role of AI through research and industry discussions.
Overall, PwC’s media and entertainment report provides valuable insights into the future of the industry. The forecasts suggest continued growth in the music, radio, podcasting, gaming, and esports sectors. The report also highlights the potential impact of AI on the industry and the need for careful consideration of its implications. Industry leaders can use these findings to inform their strategies and navigate the evolving landscape of media and entertainment.
