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What global music and podcasting revenues could look like in 2027: PwC expert explains forecast


On June 19, accounting firm PwC unveiled its annual media and entertainment reportwith predictions and food for thought for market leaders.

It covers the years 2023-2027 and provides forecasts for the growth of the overall media and entertainment industry, as well as deeper dives into the various sectors from cinema, TV advertising and streaming to music, radio and podcasting, along with gaming and esports. It also looks at newspapers, magazines and books, as well as internet advertising, VR/AR, NFTs and the metaverse.

The prospects? PwC forecasts compound annual growth in global music, radio and podcasting for 2022-2027 of 2.7 percent, with revenue increasing from $104.4 billion in 2022 and $110.9 billion in 2023 to $120.6 billion in 2027 While radio will see a slight decline in that period, digital music streaming is expected to show a compound annual growth rate of 11.6 percent, with recorded music seeing a 6.5 percent increase and live music a increase of 2.0 percent. Podcast ads are expected to deliver a compound annual growth rate of 11.8 percent.

The Hollywood Reporter spoke to PwC CEO CJ Bangah about the drivers of growth, along with the AI ​​hot button problem.

What’s the main trend in the music and audio space where your Outlook includes radio and podcasting? Is there any growth left after the live music boom following the COVID pandemic and despite some recent corporate podcasting cuts?

The story of music is really growth through live events, and we continue to forecast growth, including in streaming.

The interesting thing about music, especially some of the music streaming services, is that they make headlines because of layoffs, but podcast advertising is also experiencing insane growth. Part of this is that if you follow a podcast and listen to the hosts, it often forms a pretty close relationship with that particular podcast from a consumer perspective. And so if the podcaster reads an ad or recommends a product, it can be a pretty good performance. And now we’re on to dynamically inserted ads as a larger percentage of podcast ads overall. But a lot of the tuning in the podcast industry is that the contracts have been huge, so profitability is a major focus, as it is for any entertainment/media company.

You’ve seen headlines dominate, but we’re seeing music growth. Live events are returning and streaming continues to grow.

PwC forecasts continued healthy growth in the global gaming and esports space. Your outlook projects that revenue of $214.5 billion in 2022 will grow to $229.3 billion this year and cross the $300 billion mark by $314.6 billion in 2027. What factors are responsible for this growth?

One of the most interesting things about gaming is that our stereotypes about gamers are now all wrong. The younger generation is more gender balanced in terms of gamers, and there are a lot of older gamers out there. It’s not just a bunch of 30-year-old men in their mother’s basement, it’s much broader. And the advertising growth comes largely from mobile games and social games. Much of the gaming growth came from people sharing a game on social media with their friends, the social media app hammered their friends until they joined and played with them. It became this pressure thing, but that served as a super effective entry point. And some of those consumers have also moved a little bit from social media games to longer form games.

So gamers are much more diverse and probably older than they were historically, and esports has contributed to that as well. There is no barrier to entry because almost everyone has a phone these days. And seeing someone else play games in esports (where PwC predicts growth from $1.8 billion in 2022 to $3 billion in 2027) makes you feel more comfortable as someone who may not have grown up in a gaming community . And then advertising makes it even more affordable. So it’s kind of a virtuous growth loop that we’ve seen with gaming.

What are PwC’s overall conclusions on the hotly debated issue of AI?

In our customer conversations, we actually have a heat map that we use. So if you look at our Entertainment & Media Outlook, the global editors have spent a lot of time talking about the role AI will play in disrupting and transforming entertainment and media. Take search ads as a great use case. Do I start my discovery efforts on a search engine or get an AI assistant? If I could just talk to my voice assistant and say, “Hey, I’d like to buy the skirt I saw on this show about this character in this episode,” that’s more possible than some of the use cases that’ not really played out over the years? So the ad disruption is huge.

You also see it in video games. So especially non-player characters can be built much faster, much more effectively and with much more impact. So (AI will) disrupt and transform entertainment and media and change cost and revenue implications. We are still in the early stages. And then we also have the back-office impact, the impact on jobs, the impact on the employee experience, the impact on companies. It will definitely be THE topic (this) week at Cannes Lions. And it will continue to be the topic of the day, with the competing forces of regulators forced to introduce new things, companies cutting off access to their APIs because they are tired of being used for free to train AI engines, companies with leaders who didn’t even grow up in the internet age and are just now trying to figure out how to bring AI in, and then the creative side says, “It’s okay if the AI ​​makes my job easier, but I’m not okay if the AI ​​will take over my job.”

We have many conversations about it. We don’t have super-precise predictions about AI in this report, but we’re publishing more and more AI research.

Merry C. Vega is a highly respected and accomplished news author. She began her career as a journalist, covering local news for a small-town newspaper. She quickly gained a reputation for her thorough reporting and ability to uncover the truth.

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