Netflix/Everett Collection
China’s entertainment and media sector is set to close the gap with the US over the next four years, according to PWC’s latest Global Outlook.
Advertising revenues and consumer spending in the world’s second-most populous country will rise by more than 7% to $362.5 billion by 2028, according to the report, increasing at nearly twice the rate of the U.S., although the U.S. industry figure remains significantly higher at $808.4 billion.
“The US, accounting for more than a third of global spending in 2023, remains the world’s largest media and entertainment market for combined advertising and consumer spending by a wide margin,” PWC said. “But with that scale comes maturity and therefore relatively slower growth.”
China’s entertainment industry has been expanding in recent years and PWC said its “continued strong growth means it is gradually closing the gap with the US in terms of market size, although strict government regulation can make investing there more complex than in other territories.”
The fastest-growing markets between this year and 2028 will be Indonesia and India, the report predicted, predicting “rapid growth” in the coming years in these territories.
PWC highlighted that each of these nations has its own distinct market dynamics, pointing out that India has become the world’s fastest-growing OTT video streaming market over the period, catering to its “vast, diverse and widely dispersed population, many of whom are obsessed with sports content in general, and cricket in particular.”
By 2028, having grown by more than 8%, India’s industry will be worth just under $100 billion, the report said, with Indonesia’s a short distance behind.
The report focused heavily on how advertising revenues are shaping up in the streaming era, predicting that global ad revenues will surpass a staggering $1 trillion within two years.
By 2028, those revenues will have doubled their 2020 value, PWC predicted. It pointed to a “plateau effect” that has “pushed leading streamers like Netflix, Disney and Prime Video to reshape their business models and find new revenue streams,” including advertising and crackdowns on password sharing.
“The three major Western global players in the streaming sector — Disney+, Netflix and Amazon Prime Video — have all launched ad-funded ‘hybrid tier’ offerings, in which consumers agree to watch ads in exchange for paying a lower subscription fee,” the report said. “In a growing number of markets around the world, many smaller or regional players are following suit.”
The report found that global entertainment and media industry revenues are expected to reach $3.4 trillion by 2028.
