Media & Ent sector to grow at 15%: FICCI-KPMG report

India's media and entertainment (M&E) sector has registered a growth of 12% in 2011, over 2010, to reach Rs 728 billon and the industry is expected to register a compounded aggregate growth rate (CAGR) of 15% by 2016, according to the latest FICCI-KPMG report.

"The Media & Entertainment industry landscape is undergoing a significant shift. Cable digitization, the promise of wireless broadband, increasing DTH penetration, digitization of film distribution, growing internet use are all prompting strategic shifts in the way companies work. Traditional business models are evolving for the better as a host of new opportunities emerge," KPMG's Head of Media & Entertainment, Jehil Thakkar said.

The growth trajectory is backed by strong consumption in Tier 2 and 3 cities, continued growth of regional media, and fast increasing new media business. Overall, the industry is expected to register a compounded aggregate growth rate (CAGR) of 15% to touch Rs 1,457 billion by 2016, an official statement on the report, said.

"The key highlights are rise in digital content consumption, launch of diverse content delivery platforms, strong consumption in Tier 2 and 3 cities, rising footprint of the players in the regional media, rapidly increasing new media business and regulatory shifts," FICCI Secretary General Dr Rajiv Kumar said.

While television continues to be the dominant medium, sectors such as animation and visual effects, digital advertising, and gaming are fast increasing their share in the overall pie. Radio is expected to display a healthy growth rate after the advent of Phase 3 reforms, the statement said.

The report, which will be formally released at the inaugural session of FICCI FRAMES 2012 on March 14, also said that while witnessing a decline in growth rate, print will continue to be the second largest medium in the Indian media and entertainment industry.