Digitalisation, one of the major forces shaping all industries, has been intensified by safe distancing and mobility restrictions, PwC said. As a result, the entertainment and media (E&M) world in 2020 has become more remote, more virtual, more streamed, more personal and – for now at least – more centred on the home than anyone anticipated at the start of the year.
PwC has forecast that 2020 will see the sharpest fall in global E&M revenue in the 21-year history of this research, with a decline of 5.6% from 2019 – more than US$120 billion in absolute terms. In Singapore, the expected decline is 5% from 2019, valued at approximately US$274 million.
Oliver Wilkinson, Entertainment and Media Leader, PwC Singapore said: "The year 2020 presents a paradox for many Singapore media businesses. There is more consumption of media than ever before, with Singaporeans stuck at home during the circuit breaker. Yet at the same time, there has been a sharp contraction in revenue and profitability for many industry players.”
While the shockwaves from 2020 will continue to ripple through the global economy, the PwC forecast shows the industry’s fundamental growth trajectory remains strong. The projections show that in 2021, global E&M spending will grow by 6.4% (Singapore: 5.3%). Singapore E&M spending is also expected to bounce back to US$5.5 million, reaching 2019 levels. From 2019 to 2024, the outlook forecasts overall revenue growth running at a 2.8% CAGR globally and a 2.5% CAGR in Singapore.
The current pain in E&M is most acute in segments that COVID-19 literally shut down, such as events: live music, cinema and trade shows. Spending on cinemas in Singapore projected to fall by 59% in 2020 and is expected to make a slow recovery. The current forecast shows that by 2024, cinema spend will remain shy of 2019 levels (US$205 million in 2019, US$200 million in 2024). At the same time, the long-running transition in newspapers from print to digital has been fast-forwarded several years, cutting into papers’ print revenues, for example.
The ongoing decline in global newspapers and consumer magazines has accelerated sharply in 2020, with overall revenues in Singapore slumping by 13%. Consumer magazines are suffering the most. That said, digital offers a silver lining: a tipping point for consumer magazines in 2024 will see their global revenue from digital advertising overtake that from print advertising. Other important sectors will struggle to claw back the growth they lost in 2019. For example, out-of-home advertising is expected to decline by 24% in 2020 but will recover in 2022.
With people staying at home, over-the-top (OTT) video has seen global revenue surge by 26% in 2020 with the Singapore numbers climbing ahead at 32%. And it is forecast to keep rising strongly in the coming years, doubling in size from US$234 million in 2019 to US$477 million in 2024. With more people home, the video games segment has also grown quickly in Singapore amidst the crisis. The segment shows 9% growth this year will remain one of the fastest growing segments going forward to 2024.
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| Source: PwC. Graphic illustrating the Global Entertainment & Media Outlook. |
Wilkinson added: "What is consistent with the outlook from prior years is the wide variance of performance between different segments, particularly given the acceleration of digital media adoption at the expense of traditional. It is in this sense that the pandemic has brought the future forward.
“That said, most affected of all have been the live entertainment and cinema segments. Before this crisis, experiences were amongst the better performing parts of the industry, but they have taken a large hit due to the safe distancing and travel restrictions. We still see a good future for such events and live experiences, but it may be some years before they can adapt to this new normal."
PwC’s 21st annual edition of the Global Entertainment & Media Outlook is an online source of global analysis for consumer and advertising spending. With like-for-like, five-year historical and five-year forecast data and commentary for 14 defined industry segments in 53 territories, the Outlook makes it easy to compare and contrast consumer and advertising spending across segments and territories.
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*As PwC continually updates the online Global Entertainment & Media Outlook data, the data at the time of writing may not align with the data found online. Please refer to the online Global Entertainment & Media Outlook 2020–2024 as the most up-to-date source of consumer and advertising spend data.
