Media and Entertainment | Make In India

Summary

The Media & Entertainment (M&E) industry revenues, at a global platform, are expected to rise from USD 1.8 Tn in 2016 to USD 2.2 Tn in 2021.¹
The M&E industry in India reached INR 1.82 Tn in 2019 registering a growth rate of 9%. The industry is expected to touch INR 2.4 Tn by 2022.²
Globally, India is the largest consumer of mobile data¹¹and the second-largest television market.³
India is currently the world’s second-largest telecommunications market with a subscriber base of 1.18 bn. India’s growing mobile economy now constitutes about 98% of all telephone subscriptions.¹³
Television households will continue to grow at over 5% till 2025, driven by connected TVs which could cross 40 mn by 2025 and DD Free Dish could cross 50 mn.
Between 2017 and 2021 (till date), Doordarshan and All India Radio across both News and General Infotainment have added a cumulative of more than 15 Million Digital Subscribers on YouTube alone, to reach a current digital subscriber base of 1.73 Crores (17.3 Million).
MeitY aims to have a ‘tectonic shift’ in digital strategy to harness the opportunity to create an economic value add of USD 800 bn by the year 2024 and USD 1 tn by the year 2025 through right digital interventions.

Reasons to Invest

India has a large broadcasting and distribution sector, comprising approximately more than 800 satellite TV channels. The distribution network consists of 6,000 multi-system operators, around 60,000 local cable operators, 7 DTH operators and many IPTV service providers.⁴
India had a total of 118,239 registered publications as of March 2018, consisting of 17,573 in the news category and 100,666 in periodicals.⁵
The 5G spectrum band is expected to be launched in 2020-21.
Procedures related to Right of Way (RoW) permission for establishment of Digital Infrastructure eased.
GOI targets the Media & Entertainment market worth USD 100 bn. Government supports anti-piracy movement and thus, draft Cinematograph Act has recommended strong action against those indulging in piracy.

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Recent Announcements

8th November 2021: Ministry of Information and Broadcasting had an MoU with the Ministry of Tourism and NFDC for promoting Cinema of India as a sub brand of Incredible India at various international film festivals

22nd October 2021: GOI has notified the Indian Telegraph Right of Way (Amendment) Rules, 2021 to incorporate the provisions related to nominal one-time compensation and uniform procedure for establishment of Overground Telegraph Line.

14th October 2021: Production Linked Incentive (PLI) Scheme for Promoting Telecom and Networking Products Manufacturing in India

16th September 2021: Cabinet approves major Reforms in Telecom Sector to boost employment, growth, competition and consumer interests.

17th June 2021: Cable Television Network Rules amended by Statutory mechanism to redress Citizen’s grievances/complaints of TV broadcast.

Statistics

Largest industries by market size, within the M&E industry in 2019, include: ⁶
- Television (INR 787 Bn)
- Print (INR 296 Bn)
- Digital media (INR 221 Bn)
- Filmed entertainment (INR 191 Bn)
After the introduction of 4G in 2015, India's broadband subscriber base has progressively increased and crossed 600 mn users as of September 2019. ¹¹
With the increasing online population, online gaming and digital media are projected to have the highest CAGR (2019-22) of 43% and 23% respectively. ⁶
Investment of around INR 3,345 crore envisaged in the sector over 4 years creating additional employment of more than 40 thousand people.
While television and print retained their positions as the two largest segments, digital media overtook filmed entertainment in 2019 to become the third-largest segment of the M&E sector. Digital subscription revenues more than doubled from 2018 levels and digital advertising revenues grew to command 24% of total advertising spend. ⁶
FFO has facilitated 120 international film makers from 27 countries to shoot in India, in last 5-6 years since its formation in 2015.

Growth Drivers

Television and AGV (Animation, Gaming and VFX) segments are expected to lead the industry growth, with opportunities in digital technologies as well. The segment has produced over 1,600 hours of original OTT content, 1,800+ films and over 200,000 hours of entertainment television. ⁶
Growth in the number and spread of multiplexes.
Increasing liberalization through FDI and tariff relaxation.
Measures such as digitization of cable distribution to enable the viewer’s choice and higher growth.
Rising incomes and evolving lifestyles, leading to higher demand for aspirational products and services.
Higher penetration and a rapidly-growing young population, coupled with increased usage of 4G and portable devices, to augment demand.

FDI Policy

BROADCASTING CARRIAGE SERVICES ⁷
- FDI in teleports, DTH, cable networks, Multi-System Operators (MSOs), mobile TV, headend-in-the-sky broadcasting services are allowed up to 100% under the Automatic route.
BROADCASTING CONTENT SERVICES ⁷
- FDI in FM radio is allowed up to 49% under the Government route.
- FDI in up-linking of ‘News and Current Affairs’ TV channels, is allowed up to 49% under the Government route.
- FDI in up-linking of ‘Non-News and Current Affairs’ TV channels/ down-linking of TV channels, is allowed up to 100% under the automatic route.
PRINT MEDIA ⁷
- 26% FDI under the Government route is allowed in the publishing of newspapers and periodicals dealing with news and current affairs.
- 26% FDI under the Government route is allowed in the publication of Indian editions of foreign magazines dealing with news and current affairs.
- 100% FDI under the Government route is allowed in publishing/ printing of scientific and technical magazines/speciality journals/ periodicals.
- 100% FDI under the Government route is allowed in the publication of facsimile editions of foreign newspapers.
The cumulative FDI equity inflow in the Information and Broadcasting industry (including Print Media) is USD 9,592.993 mn during the period April 2000 to June 2021. This constitutes almost 1.75% of the total FDI inflow received across sectors.¹²

Production Linked Incentive (PLI) Scheme

The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi has given its approval to introduce the Production-Linked Incentive (PLI) Scheme in Telecom & Networking Products sector for Enhancing India’s Manufacturing Capabilities and Enhancing Exports – Atmanirbhar Bharat.

Financial Outlay: INR 12,195 crore

For more details on PLI Scheme, Click Here

Sector Policy

Cable operators under the digitization regime, are legally bound to transmit only digital signals, while customers can access subscribed channels through a set-top box.
The Government announced 90% subsidy for the North Eastern States and 75% subsidy for other states in setting up of community radio stations. ⁸
National Digital Communications Policy (2018) has the following objectives to achieve by 2022: ⁹
- Broadband for all
- Creating 4 mn additional jobs in the Digital communications industry
- Enhancing the contribution of the Digital Communications industry to 8% of India’s GDP from 6% in 2017
- Propelling India to be the top 50 nations in the ICT Development Index of International Telecommunication Union (ITU) from 134 in 2017
- Enhancing India’s contribution to global value chains
- Ensuring digital sovereignty
Co-production treaties with various countries such as Italy, Brazil, the UK and Germany are to increase the export potential of the film industry.
The “National Broadband Mission” (NBM) or “Rashtriya Broadband Abhiyan” has been launched by the Government of India to operationalize the objective of National Digital Communications Policy – 2018 (NDCP-18), i.e. “Broadband for All”. NBM also aims to bridge the digital divide in the country, fast track growth of digital communications infrastructure, facilitate digital empowerment & inclusion and provide affordable, universal access to broadband to all. ¹¹

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Financial Support

PROVISIONS OF THE 2020-21 UNION BUDGET

It has been proposed to provide USD 845 Mn to Bharatnet programme in 2020-21 ¹⁰
Bharatnet Project aims to connect 100,000 gram-panchayats (village councils) with high-speed broadband connectivity.

STATE INCENTIVES

Available with different states depending upon the investment, number of jobs created, area of investment, etc.

OTHER INCENTIVES

Ministry of Information & Broadcasting, Government of India, announced 90% subsidy for the North Eastern States and 75% subsidy for other States in setting up of community radio stations. ⁸

Investment Opportunities

Some of the prospective sub-sectors in the E&M industry for private investors include: ⁶

Television industry
Digital media
Filmed entertainment
Animation and VFX
Online gaming
Over-the-top (OTT) media services

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Foreign Investors

Walt Disney (USA)
NBC Universal (USA)
Ogilvy and Mather (USA)
Blackstone (USA)
Interpublic Group (UK)
Bloomberg (USA)
News Corp (USA)
Sony (Japan)
Leo Burnett (USA)
BBC (UK)

Agencies

Sources

Value of the global entertainment and media market from 2011 to 2021 (in trillion U.S. dollars), Statista website, https://www.statista.com/statistics/237749/value-of-the-global-entertainment-and-media-market/
The era of consumer A.R.T. - India's Media & Entertainment sector, FICCI, http://ficci.in/publication.asp?spid=23200
Journey of Television Revolution, PIB website, http://pibarchive.nic.in/newsite/printrelease.aspx?relid=169686
Journey of Television Revolution, PIB website, http://pibarchive.nic.in/newsite/printrelease.aspx?relid=169686
Press In India Highlights, Office Of Registrar Of Newspapers For India (GoI) website, http://rni.nic.in/all_page/press_india.aspx
The era of consumer A.R.T. - India's Media & Entertainment sector, FICCI, http://ficci.in/publication.asp?spid=23200
Consolidated FDI Policy, https://static.investindia.gov.in/s3fs-public/2020-09/FDI%20Policy%202020%20revised_18%20Sept%202020.pdf
I&B Ministry to provide 90% subsidy for NE States and 75% subsidy for other States for setting up Community Radio Stations,” PIB website, http://pibarchive.nic.in/newsite/PrintRelease.aspx?relid=155261
National Digital Communications Policy 2018, Department of Telecommunication website, http://dot.gov.in/sites/default/files/EnglishPolicy-NDCP.pdf
Summary of Union Budget 2020-21, PIB website, https://www.pib.gov.in/PressReleseDetail.aspx?PRID=1601475
National Broadband Mission, https://dot.gov.in/sites/default/files/National%20Broadband%20Mission%20-%20Booklet_0.pdf?download=1
Factsheet on FDI - April 2000 to June 2021, Department for Promotion of Industry and Internal Trade, https://dpiit.gov.in/sites/default/files/FDI_Factsheet_June2021.pdf
Annual Report, Department for Promotion of Industry and Internal Trade, https://dot.gov.in/sites/default/files/Annual%20Report-2019-20%28%20English%29.pdf