Media Market

From Australia to Austria, Russia to the United States, South Africa to Mexico, media and entertainment (M&E) is everywhere. Wherever mankind exists, the need for information and entertainment arises. With Internet penetration rising sharply, the world is on its way to becoming one big media market without boundaries. However small the world may get digitally, it is still physically a big place. Coverage in this report is therefore limited to key markets such as the US, the UK, Europe, Japan and emerging markets like India and China.

US media market

The US economy has been on the road to recovery after experiencing recession in 2001. The United States is the largest geographical sector of the global M&E market, accounting for 42 percent of revenue. The growth of US M&E depends on the state of the US economy. If the economy does well, M&E also does.

The US media market grew by 4.3 percent from USD501.53 billion in 2002 to USD523 billion in 2003. Television distribution has driven revenues overall of the television industry, which constituted 25 percent of the market in 2002.

Europe media market

The structure of European media market has been changing since the 1980s owing to rapid advances in media technologies along with the liberalization of key markets.

Several new commercial broadcasting operations have appeared as a result of market liberalization at the national level. Media companies have engaged in mergers and acquisitions to amass the necessary financial capital required for the new technologies available for broadcasting. National governments have aided industry concentration by relaxing media ownership rules, including those restricting cross media ownership.

Europe's entertainment and media spending totaled EUR213.28 billion in 2003, up 4 percent from 2002. This growth, though better than that of 2001, is well below the encouraging growth seen during 1998–2000.

Television Networks make the largest contribution to the European M&E business with newspaper publishing second and book publishing a distant third. Germany is the largest M&E market in Europe followed by the UK.

UK media market

The UK economy is the fourth largest in the world and the second largest in the European media industry. In the UK, as in most developed countries, the share of manufacturing has been decreasing at a rate relative to that of services. The UK’s communications and creative sectors have been growing steadily. 

According to Ofcom, end-user spending on regulated communications services was up by 9.8 percent in 2003. This increase was higher than the UK economic growth rate. Therefore, its share of GDP has gone up marginally from 4 to 4.1 percent.

The main revenue source for the UK media market is publishing. Its filmed entertainment market is the largest in Europe, followed by relatively smaller markets such as France and Germany. The UK has one of the world’s most advanced digital TV networks. In fact, the UK government plans to switch off the analogue network within the next decade, due to the high penetration of digital TV.

Digital Technology is expected to drive sector growth in the next five years.  Analogue radio, television and fixed-line telephony have been available for some time, but over the past five years, the coverage and number of digital services have increased. Most digital services are available to the majority of the population, although uptake varies considerably by platform.

Broadcasters are increasingly looking for ways to make digital television more attractive to viewers and, as a result, boost their own media market share. Also, the use of other emerging technologies and appliances is changing the landscape of home communications.

DVD is currently the fastest growing new home technology with 45 percent of adults owning a DVD player at the end of 2003, up from 5 percent in 2000.  VCR ownership is now either static or in some regions falling.

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