Spending on digital media — largely driven by smartphone and tablet ownership — will account for 44% of all entertainment and media expenditures in the next five years, far outpacing other sectors, according to a PricewaterhouseCoopers report.
Increased access to the Internet and smart devices is democratizing consumer access to content, PwC’s Global Entertainment and Media Outlook 2013-2017 said. Though traditional non-digital media will dominate E&M spending over the next five years, the growth will be concentrated in digital media platforms and consumption.
Mobility’s increasing importance will become a big factor in the rise in digital spending.
At a PwC event in New York on June 5 to launch the report, Sean DeWinter, PwC partner, entertainment, media and communications, said 77% of Internet searches are done using a mobile device in the presence of a fixed PC or a laptop.
“People reach for their mobile device even before they look at the browser on their laptop,” DeWinter said.
Pay TV penetration, which peaked at 82% between 2006 and 2009, is expected to decline to about 79% by 2014 and maintain that level for the following three years, according to PwC. Satellite TV is expected to grow by 2.7 million, to 34.6 million, and telcos will grow from 10.1 million in 2012 to 14.3 million by 2017.
PwC projected that global entertainment and media spending will rise from $1.6 trillion in 2012 to $2.2 trillion by 2017, for an annual growth rate of about 56%. The U.S., market, according to PwC, is expected to grow at a 4.8% annual clip, to $632 billion in 2017 from $499 billion in 2012.
Global digital spending, at 44% of total E&M expenditures, is almost double the level in 2008 and up from 34% in 2012, according to PwC. In the U.S., digital spending is expected to account for 43% of all E&M expenditures, up from 31% in 2012.