New providers and corona drive growth in streaming sector

Entertainment en Media Outlook 2020-2024

In 2020, global turnover of popular streaming media services such as Netflix, Amazon and Videoland will surpass cinema revenues for the first time. PwC’s Global Entertainment & Media Outlook 2020-2024 predicts cinema turnover will fall by 66 percent; at the same time, the streaming sector is showing unprecedented growth – estimated at 26 percent – due to corona and the arrival of new providers such as Disney+. "Producers are seeking new models that allow them to skip the cinema window," is the analysis of Casper Scheffer, entertainment and media expert at PwC.

Sharp fall in turnover, modest growth through to 2024

“Since the launch of our Entertainment and Media Outlook more than 21 years ago, we have never seen anything like the current severe decline in sales in the industry,” Scheffer says. “We expect a 5.6% drop in 2020 – around 120 billion US dollars – compared to 2019, which was a record year. This is largely because of the cancellation of live events.” Next year PwC expects the industry to recover and report growth of 6.4%. “Through to 2024, we predict average growth of 2.8%, particularly on the back of digital developments like virtual reality, e-sports and games, streaming, music and podcasts.”

Film industry hit hard

The corona crisis has dealt the movie industry a heavy blow. Global cinema sales will probably remain under 2019 levels until through 2024. By contrast, turnover generated by streaming services is set to continue growing from 46.4 billion US dollars in 2019 to 86.6 billion US dollars in 2024. “Cinemas are under unprecedented pressure,” says Scheffer. “Corona has slashed visitor numbers, which in turn is accelerating a development where producers are searching for new models to be able to pass over the cinema window. Since the advent of television, the sector has always been able to reinvent itself and survive. Recent investments in innovations like 3D, IMAX, 4DX and Dolby Digital ensure a solid basis, but success going forward will more than ever be dependent on access to blockbusters.”

Advertising market shrinking and changing

The lockdowns and reduced content production and consumption have also caused a sharp decline in advertising revenues. A drop of 13.4 percent – around 86.5 billion US dollars – is expected; the advertising market will probably regain its 2019 level in 2022. “Both the content and advertising markets will continue to globalise,” concludes Scheffer. “For the Netherlands, this means that the market will ‘Americanise’ further as a result of the impact the corona measures are having on consumers and companies. Dutch content publishers and producers will need to think up smart solutions to turn this around. Exploring and connecting local communities is an option, as are cooperation and ownership of data and content.”