These days, no article worth its salt can begin without a reference to COVID-19. This is understandable, because the pandemic is certainly playing a role in shaping consumer behaviour and industry trends — some of which may be transient, some that may last for a few months to years, and others that may become permanent. A consistent manner in which the pandemic seems to be creating an impact is by accelerating trends that were already starting to germinate. For example, organizations had started exploring the concept of work-from-home pre-COVID. However, the advent of COVID-19 put wind in the sails of the fledgling work-from-home concept, greatly accelerating its adoption. In this article we explore key trends that are likely to shape the media and entertainment (M&E) industry in India. One may note that the aspect of acceleration of pre-existing themes by COVID-19 touches many of these trends.

Trend #1: Rapid digital adoption

Online/digital consumption was already capturing an increasing share of Indians’ media consumption pie. Indians spent approximately 30% of their total media consumption time on digital media in 2019; this was approximately 18% in 2013 . The COVID-19 situation is seen to have accelerated this shift. Curtailment of outdoor entertainment options and breaks in physical delivery of print media have propelled the shift to digital. While there have been some notable exceptions such as the record-breaking re-run of the 1980s series “Ramayan”, linear GEC television channels are facing challenges because they have been unable to create fresh content and the early COVID bump in viewership is tapering off. Against the backdrop of shuttered cinema halls, some producers are exploring movie releases directly on over-the-top (OTT) platforms. All of these factors provide impetus to digital platforms.

As the bulk of video streaming in India occurs on the mobile – a personal medium, this shift is likely to also evolve into more personalized entertainment, and one can expect the type of content to change and diversity of content to increase. In pre-COVID days, Deloitte had estimated the video OTT industry size to grow at a CAGR of 30 per cent from Rs 6,100 crore in FY2020, to Rs 17,400 crore in FY2024 . COVID-19 is likely to result in faster growth for the industry.

Trend #2: Consolidation

The second key trend is continued consolidation — both M&A and exits. This trend has been playing out in the recent past across various sub-sectors in the M&E industry, and this momentum is expected to continue. Examples include Disney’s acquisition of Fox/Star; Zee’s stake sale; Dish TV-D2H merger; Reliance/Jio’s acquisition of stakes in content, broadcasting and distribution businesses; stake sales in Jio Platforms; and the recent merger discussions between Sony and Viacom 18. The OTT space (which has 35+ players) and print are also expected to witness consolidation and exits.

Another way that OTT consolidation could take shape is through the rise of OTT aggregators. If one looks at the US, video OTT subscription fatigue is growing — and this is when US consumers have an average of only three such subscriptions. As more TV networks, film studios, and tech companies launch their own services, this frustration is expected to only grow . Thus, there is a play for an aggregator.

Overall, as a result of consolidation, the M&E industry is likely to emerge stronger and more efficient.

Trend #3: The rise and rise of performance-based advertising

The third important trend is an even greater focus on performance-based advertising and return on investment (RoI). The world has come some way from the time John Wanamaker famously observed, “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.” Still, measuring and quantifying the impact of advertising is an evolving quest, and we are nowhere near the end. As a corollary to this trend, we expect a continuing shift towards digital, and creatives also moving in the direction of digital.

The “half trend”: The age of subscription?

The last trend may technically be tagged as a wish-list item rather than a trend. This is the rise of subscription as a revenue model. Publishers and content creators often remark on the dependence of the industry on advertising, which may arguably constrain creativity and may result in content that is not created with the viewer and viewer’s interests at the core. As digital models proliferate and direct consumer connects and a deeper understanding of consumers becomes possible for many media companies, it may provide the primordial soup to evolve robust subscription dominated models.

While 2020 is a difficult year, the COVID-19 pandemic has played the role of an accelerator for many trends. We may end up with ten years’ worth of change over a two-three year window. As Bob Dylan said, “It’ll soon shake your windows and rattle your walls; for the times they are a-changin”.

DISCLAIMER: The views expressed are solely of the author and ETBrandEquity.com does not necessarily subscribe to it. ETBrandEquity.com shall not be responsible for any damage caused to any person/organisation directly or indirectly.