Set to grow

Before the recent slowdown, an ebullient economy, along with favorable demographics, meant that the entertainment & media sector was one of the fastest growing in the country. Rapid expansion, buoyed in part of record advertising revenues led to a compound annual growth rate (CAGR) of 16% during 2004-08.
Price Water House Coopers'(PWC) recently launched annual report on the E&M industry preicts that the sector will record a CAGR of 10.5% during 2010-2013. The print media is also expected to grow with the launch of new magazines & steady growth in newspaper publications which accounts for the majority of the segment.
However its emerging media segment such as the Internet & the digitised content platforms, that are set to grow drastically. Such predictions are hardly new but whether or not digital content can transform the E&M scene like in the West remains to be seen. KPMG's report on the E&M industry earlier this year too hailed digital content both print & interactive as a possible way forward. But while news publications have increasingly gone online for free, interactive media platforms such as games & movies are yet to make a real impact. One reason to remain cautious about Internet advertising is that many Indians simply do not have adequate access to the Internet at reasonable prices but this is set to improve with additional investment.
PWC's bright picture of the E&M industry in India augurs well for investors both foreign & domestic who still believe in the region's growth potential. India has whethered the global recession better than most countries. Its GDP grew by 5.8% during the last quarter of 2008 compared to the same period in 2007 & by the same amount in the first quarter of 2009, which is encouraging for those who link GDP with ad spends. However with the decline in per capita income levels post-slowdown from 6.9% in 2007-08 to 1.4% in 2008-09 it makes one wonder whether or not consumer sentiments have changed after the recent slump.