Internet, consumers driving growth in South Africa’s entertainment, media industry – PwC

Internet, consumers driving growth in South Africa’s entertainment, media industry – PwC

Vicki Myburgh, Entertainment & Media Industries Leader for PwC South Africa, has described the Internet and consumers as the major drivers of the growth of the entertainment and media industry in South Africa.

She said, “Growth in the South African entertainment and media industry is largely being driven by the Internet and by consumers’ love of new technology, in particular mobile technology, such as smartphones and tablets, as well as applications powered by data analytics and cloud services. Technology is increasingly being driven by consumers’ needs and expectations.”

In a report released today, PwC said increased Internet access will generate more consumer spend than any other media product or service in the next five years in the South African entertainment and media industry.

According to PwC’s ‘South African Entertainment and Media Outlook’, the industry is expected to grow by 10.2% compounded annually (CAGR) from 2014 – 2018 to a value of R190.4bn. By far the largest segment will be the Internet. Combined revenues from Internet access and Internet advertising will account for an estimated R71.6bn in 2018, accounting for 37.6% of total revenues.

The Outlook said fastest growth will be seen in video games and radio, 9% and 8.2% respectively.

“Video games has made the greatest transition to digital, largely due to the popularity of mobile gaming, but also because of the  increased potential for digital distribution of console games,” said Myburgh.

The slowest growing segment in the industry the report said will be music. Annual revenue is forecast to grow marginally by a CAGR of 0.5% to remain relatively flat at R2.18bn in 2018.

“The strongest drivers of growth in the sports segment will come from sponsorships and media rights. South Africa will see total sports revenues of an estimated R20.5bn in 2018, up from R14.8bn, and rising at a CAGR of 6.7%,” PwC said in a statement.

The report said electronic home video is also catching on rapidly in the film segment.

PwC said: “Far less digital take-up is being seen in the magazine, newspaper and book segments, with digital revenues for each forecast to be under 7% of the total, even in 2018. Although consumers may be browsing newspapers and magazine-style websites online, monetising these consumers presents much more difficulty for E&M businesses.”

Image courtesy of ShutterStock

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