Digital Growth Drives Upbeat Media, Entertainment Outlook


The consumer and advertisers are back, and they're here to stay, according to PricewaterhouseCoopers's new Media & Entertainment Outlook, through 2015.

New digital platforms are driving gross across the board, as consumers look to consume content in new ways and advertisers pay to reach them on all the new gadgets where they're spending their time.

PwC projects overall U.S. media and entertainment spending — which includes all consumer spending on entertainment and all advertising spending — will grow 4.6 percent compound annually to $555 billion in 2015, up from $443 billion last year.

One of the strongest segments driving this growth is Internet advertising, which is expected to average 12.2 percent compound annual growth through 2015. The overall US ad market is on track to grow at a 4.2 percent compound annual growth rate. It grew 5.4 percent last year, rebounding from a massive 14.4 percent slump in 2009.

And U.S. consumer spending is back in a big way, after a nearly 3 percent decline in 2009. PwC groups together every possible type of consumer spending on media and entertainment — from movie tickets to Internet access — and the sector is projected to grow from $230 billion in 2010 to $283 billion in 2015. That's 3.6 percent growth this year and 4.3 percent compound annual growth over the next 3 years.

PwC partner Christ Economos explains the uptick by saying that the proliferation of technology is increasing demand for content. All the new digital platforms are creating new business models — showing that people will spend on content if it's convenient and the opportunity is right. PwC says the five key attributes that matter to consumers are "convenience, experience, quality, participation and privilege."

And the further good news for the media giants is that those attributes can create new profitable businesses that far outweigh piracy.

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