Fun Business: India and China are driving growth in global media and entertainment

Entertainment could be the best business proposition going. According to a PricewaterhouseCoopers (PwC) report, India and China are set to drive expansion of the global entertainment and media (E&M) industry to $2 trillion by 2011. BRIC countries will be responsible for 24 per cent of this growth, with India and China as the principal contributors.

India’s E&M market is experiencing a tearaway 18.5 per cent annual growth, the highest in the world among major markets. The country is clearly in the throes of a consumer boom. With rising disposable incomes, people have more to spend on leisure and entertainment. An increase in advertising spend, which stands at a mere 0.34 per cent of GDP in 2006, could boost the ongoing expansion of India’s E&M industry, which encompasses newspapers, magazines, TV content, TV distribution, radio, broadband Internet, films, video games, amusement parks and more. Given that India has the potential to become a big E&M player — as it is in IT today — concentrated efforts must be made to make this sector of the economy internationally competitive.

E&M is being transformed by the advent of digital technologies and the PwC report says that half the expected industry growth will be generated through online and wireless technologies. Regulation of broadcasting, cable and Internet distribution networks must take account of technological convergence, thanks to which phone, TV and broadband Internet services can soon be provided together in one gadget. The policy framework must not be biased against any particular media format, and there should be a level playing field between public and private sector players. Piracy also needs to be addressed, for which legislation needs to be beefed up and enough empowered officers deployed in the field to check piracy.

Bollywood will find Hollywood taking the battle to its home markets by dubbing its products in Hindi or other regional languages. Indian movie-makers will have to respond by making films that are internationally acceptable beyond the Indian diaspora markets. Bollywood doesn’t yet have its equivalent of Crouching Tiger, Hidden Dragon, a film made with an international cast of ethnic Chinese actors that grossed $130 million in the US market. When that happens Indian soft power will be a force to reckon with in the world.