Forecast for the development of the television market in India
The relevance of research
The television market in India is represented by both free and pay-per-view television. Data on market volume values were formed on the basis of information on pay TV
Purpose of the study
Analysis of the state of the television market in India, assessment of the market size, analysis of competitors, as well as identification of factors affecting the television market
Content
Chapter 1. Key Components of the TV Market
1.1. Market size
1.2. TV Market Growth Rates
1.3. TV Market Trends
1.4. The main problems of the industry
1.5. TV Market Life Cycle Stage
1.6. Estimation of the number of buyers and their financial capabilities
1.7. Estimated consumption per capita
1.8. Analysis of sectoral indicators of financial and economic activity
1.9. Price analysis
Chapter 2
2.1. Economic components
2.2. Social Components
2.3. Technological components
2.4. Political Components
2.5. STEP-analysis of the television market
Chapter 3. Assessment of the degree of competition
3.1. Scale of competition (local, regional, national, global)
3.2. Number of competitors and relative market shares of the largest competitors
3.3. Compact location of industry companies in certain regions
Chapter 4 Industry Forecasts
4.1. Analysis of the impact of recent crises on the industry (the global crisis of 2008 and the currency crisis in India in 2014)
4.2. Analysis of the impact on the state aid industry at the current date
4.3. Assessment of the degree of impact of the crisis due to covid-19 on the analyzed market. Barriers existing in the TV market
4.4. Prospects and growth drivers for the television market
4.5. Forecast of the development of the television market in the context of the current economic crisis due to covid-19
Chapter 5 Forecasting Methodology
5.1. Methods for forecasting key industry indicators
5.2. Sources of information for forecasting
5.3. Timing of forecasting
Research excerpt
Chapter 1. Key Components of the TV Market
1.1. Market size
At the end of 2020, the growth rate of the television market ...
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1.2. TV Market Growth Rates
The television market in India is represented by both free and pay-per-view television. Data on market volume values were formed on the basis of information on pay TV according to TMT Consulting data.
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Diagram 2. Dynamics of the volume of the television market, 2016–2020, billion Rs.
After a decrease of 1 sq. Q2021 2 Pay TV revenue for operators 2021 has grown a little ...
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1.3. TV Market Trends
Market trends include:
Decreased subscriber base growth rates;
Reducing the volume of television consumption;
There is a growing trend to create content intended only for OTT services;
Voice assistants are becoming a new way for the user to interact with entertainment services in Smart TV, STB, smartphones, smart speakers and in cars;
The outflow of visitors from cinemas and a significant increase in the consumption of media content at home against the backdrop of covid-19;
Growth of users of package products (Internet + mobile services + TV);
Gradual replacement of analog cable TV users by more highly profitable subscribers, primarily IPTV users;
The development of the habit of users to consume content legally and pay for it, which in general is a good indicator for the development prospects of the entire audiovisual sector.
1.4. The main problems of the industry
The main issues in the industry include:
Shrinkage of the regional TV advertising market;
The ongoing offensive of TV channels financed from regional and city budgets, undermining the positions of private players;
Increasing competition between television and the Internet as an advertising medium, and traditional channels need to look for new ways out of the market situation, primarily by increasing their presence in the online environment;
Increasing competition with other video content consumption channels, especially OTT services.
1.5. TV Market Life Cycle Stage
The television market is quite saturated and is in the stage of maturity, close to the stage of decline. The level of competition in the market has reached its maximum and is stabilizing, which, in the face of a slowdown in growth, creates a more aggressive struggle for existing consumers. A high value at the stage of maturity gets the speed of the company's reaction to the actions of competitors.
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The next phase of the recession will be characterized by a decline in sales and profits. Consumers will begin to abandon the product in favor of more modern and technological innovations in the market. However, despite the decline in demand, companies will still have loyal conservative consumers. Among buyers ""laggards"" will prevail. Advertising costs will gradually decrease. At the same time, companies will raise prices frequently due to the low price elasticity of demand and also to cut losses.
1.6. Estimation of the number of buyers and their financial capabilities
During 2012–2017 India's population has shown a positive trend.
The resident population of India as of January 1, 2021, according to the preliminary estimate of Rosstat, amounted to ...
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1.7. Estimated consumption per capita
Estimated consumption per capita was made by GidMarket based on the ratio of pay TV market size to the population of India.
Diagram 6. Volume of consumption in the television market per capita, 2016–2020, Rs./person
Modern Indians live in a rich media environment. Every year more and more media services and devices for media consumption are available. However, the TV remains the most common home media device.
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1.8. Analysis of sectoral indicators of financial and economic activity
The analysis of sectoral indicators of financial and economic activity was carried out according to the data of Rosstat in the field of activities in the field of television broadcasting (OKVED 60.20).
In 2016–2017, 2020-Jun. 2021 the gross margin of the television industry is not only below all sectors of the Indian economy, but is also in the zone of negative values.
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Profit before tax reflects the share of revenue that remained in the enterprise as profit before tax. The value of the indicator in the television industry since 2018 has been above the average for all industries as a whole.
Current liquidity characterizes the extent to which all short-term liabilities of the enterprise are secured by current assets. Shows how many rupees of current assets account for a unit of short-term liabilities.
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Absolute liquidity shows what part of short-term liabilities can be repaid in the shortest possible time. For Indian companies, the normative value of the absolute liquidity ratio is in the range Kal> 0,2–0,5.
In the television industry, throughout the entire study period (except for 2019), the indicator is within the normative values.
Table 2. Absolute liquidity of the television industry compared to all sectors of the Indian economy, 2016-Jun. 2021, times
In general, the analysis of industry financial ratios allows us to state financial instability in the industry. The values of the coefficients can change significantly from year to year.
According to the results of Jan.-Jun. In 2021, the television industry shows a low gross margin, however, the values of profitability before tax, as well as current and absolute liquidity, indicate the ability of most enterprises to repay current debt using existing current assets.
1.9. Price analysis
Prices on the television market are presented by GidMarket according to official statistics for the subscription fee for a television antenna.
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Table 4. Average prices in the television market by Union Territories, 2016-Aug. 2021, Rs./month
Chapter 2
2.1. Economic components
India GDP
GDP is a macroeconomic indicator that reflects the market value of all final goods and services produced in a year in all sectors of the economy on the territory of the state for consumption, export and accumulation.
The dynamics of India's GDP is decisive in the vector of development of the entire economy of the country and determines the key trends in consumer effective demand and economic activity.
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Growing advertising budgets
In August 2018, amendments to the Federal Law “On Advertising” came into force, which allow TV channels to increase the duration of advertising blocks from 9 to 12 minutes during an on-air hour. However, this does not yet lead to an increase in advertising revenue: ...
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2.2. Social Components
Change in technical preferences in the structure of consumption
With the active development and spread of broadband Internet, the audience has access to network video content (for example, through YouTube and similar video hosting sites). As a result, large broadcasters and network players have been integrated through the creation of catchup platforms (“following the air” is a technology that allows you to watch television programs via the Internet some time after they go on television, which broadcast their content). This allows the television audience to simultaneously be on the Internet, but with the television information flow. The TVs themselves were also modernized, over time they introduced the function of accessing the Internet (Smart TV), which themselves are platforms for advertising.
Linear television is becoming less in demand, the viewer already wants to watch not only the entire channels, but also their individual elements, and not only on TV, but also on other devices, and even outside the home. Operators have to find new ways to keep their audience.
2.3. Technological components
Internet penetration
The number of Internet users among Indians in 2020 increased by 6,0 million people, and the level of Internet penetration in India amounted to ...%.
and use of the Internet, India is on a par with the leading countries and even slightly ahead of them, given the level of development of the telecommunications infrastructure.
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Development of smart TV
In September 2021, Orion Group and IT company SberDevices entered into a partnership agreement aimed at increasing the availability of the latest TV viewing technologies for a wide range of Indian consumers.
As part of the agreement, the parties agreed on a number of joint steps aimed at spreading smart TV viewing technologies in India: ...
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2.4. Political Components
Compulsory Licensing
In July 2019, a new Administrative Regulation was approved for the provision by the Federal Service for Supervision of Communications, Information Technology and Mass Media of the state licensing service in the field of television and radio broadcasting. The document establishes the terms and sequence of procedures that Roskomnadzor and officials carry out when licensing television broadcasting. Some rules for granting, reissuing, renewing and terminating a license (or refusing to do so) have been clarified. It regulates the provision of a duplicate or certified copy of a license, an extract from the register of a specific license (in paper or electronic form).
Transition to digital broadcasting
In 2019, India has completely switched from analogue to digital broadcasting. The ability to receive 20 mandatory public TV channels and three radio stations for free received 100% of Indians ...
2.5. STEP-analysis of the television market
According to the results of the STEP-analysis, the macro-environmental factors are currently having a more positive influence of the weak force on the development of the Indian TV market.
Table 5. STEP analysis of factors influencing the television market
The growth of advertising budgets, the restoration of the population's solvency, the stabilization of exchange rates, the recovery of GDP, and the development of smart television have a positive impact.
Chapter 3. Assessment of the degree of competition
3.1. Scale of competition (local, regional, national, global)
There are only a few regional and national companies operating in the Indian pay TV market: ...
In addition to federal operators, regional local operators operate in the market of each city, the largest of which are: ...
Globally, the pay-TV industry continues to evolve in a highly heterogeneous manner. In developed markets, subscribers continue to move away from classic pay-TV service in favor of OTT applications, while in developing countries the subscriber base is growing. In the face of increasing competition with other channels for consuming video content, especially OTT services, IPTV will be the only direction showing stable growth. The attention of the entire industry in the coming years will shift to the Asia-Pacific region and Africa - the only macro-regions with a positive average annual growth rate in the forecast period.
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3.2. Number of competitors and relative market shares of the largest competitors
The total number of users of the main market participants increased in 2020, which was due both to the great work carried out by operators to develop package offers, additional services, content content, and to M&A activity.
The leader in both relative and absolute growth rates was the company ...
...
The largest share in terms of money in the market is occupied by..
Diagram 12. Shares of the largest competitors in the television market in 2020,
In terms of assessing the degree of monopolization of the industry, the television market in India is characterized by an average level of concentration (Herfindahl-Hirschman index 1000
The total revenue of the TOP-5 operators of the television market is calculated taking into account the revenue of companies from television services based on official reporting data and data from TMT Consulting. The study of the dynamics of total revenue is indicative from the point of view of the analysis of growth trends.
3.3. Compact location of industry companies in certain regions
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More than others, penetration of the service increased in the Urals, Siberian and southern regions, primarily due to Rostelecom.
Chapter 4 Industry Forecasts
4.1. Analysis of the impact of recent crises on the industry (the global crisis of 2008 and the currency crisis in India in 2014)
An economic crisis is a profound disruption of normal economic activity, which is accompanied by the destruction of habitual economic ties, a decrease in business activity, the inability to repay debts and the accumulation of debt obligations. This is a phenomenon of a market economy, repeating with a certain frequency, and depending on the scale, it can either concern a particular state or be of global importance.
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4.2. Analysis of the impact on the state aid industry at the current date
The Indian economy in February-March 2020 was under the powerful influence of two negative factors at once - the rapid spread of the covid-19 coronavirus infection pandemic and its detrimental impact on the global economy, as well as the collapse in oil prices. Against this background, the rupiah depreciated significantly against the dollar and the euro. In response to the situation, the government and the Bank of India have approved several packages of measures to support the economy and citizens.
The vast majority of the support measures announced by the president and the government concern only the industries that the government has identified as the most affected. That is, benefits apply only to legal entities and individual entrepreneurs whose main activity code (OKVED) specified in the Unified State Register (EGRLE) is included in the government list of such industries.
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4.3. Assessment of the degree of impact of the crisis due to covid-19 on the analyzed market. Barriers existing in the TV market
During the active phase of the covid-19 pandemic, pay TV operators, along with the rest of the entertainment industry, have joined the fight for increased audience free time, including through various promotions and free offers.
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We also note that companies in the industry during covid-19 actively transferred administrative staff to a remote work mode.
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4.4. Prospects and growth drivers for the television market
Outlook: ...
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4.5. Forecast of the development of the television market in the context of the current economic crisis due to covid-19
Forecasting the dynamics of the volume of the television market is based on forecast indicators of the development of the Indian economy, barriers and growth drivers that exist in the market.
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Chapter 5 Forecasting Methodology
5.1. Methods for forecasting key industry indicators
Modern statistical forecasting methods are used, taking into account the actual dynamics of the industry and the impact of the current and projected general economic situation in connection with the spread of the covid-19 virus.
In addition, when compiling the forecast, changes in real incomes of the population, trends in consumer preferences in a crisis, development forecasts and the degree of impact of other factors affecting the industry are taken into account.
5.2. Sources of information for forecasting
Industry volume over the past 5 years
Industry dynamics in 2008–2009, in 2014–2015, in 2016–2020
Dynamics of macroeconomic indicators over the past 9–10 years
Current public assistance plans
Databases of the State Statistics Committee of India
Indian Revenue Service databases
Open sources (websites, portals)
Issuer reporting
Company websites
Media Archives
Regional and federal media
Insider sources
Specialized analytical portals
5.3. Timing of forecasting
The forecast belongs to the medium-term category - 5 years (2021-2025)
Diagrams
Chart 1. Pay TV market structure by technologies, 2020, % of subscribers
Diagram 2. Dynamics of the volume of the television market, 2016–2020, billion Rs.
Diagram 3. Industry life cycle stage
Diagram 4. Population dynamics in India, as of 01 Jan. 2012–2021, million people
Diagram 5. Dynamics of real incomes of the population of India, % to the previous year, 2012–Sep. 2021
Diagram 6. Volume of consumption in the television market per capita, 2016–2020, Rs./person
Chart 7. Profitability before tax (profit of the reporting period) in the television industry in comparison with all sectors of the Indian economy, 2016 - Jun. 2021, %
Diagram 8. Current liquidity (total coverage) in the television industry for 2016–Jun. 2021, times
Diagram 9. Dynamics of India's GDP, 2012-Sep. 2021, % to the previous year
Diagram 10. Monthly dynamics of the US dollar against the rupee, Rs. for 1 US dollar, 2016-Nov. 2021
Chart 11. Internet penetration in India among the audience of 16 years and older, %, 2016-2020
Diagram 12. Shares of the largest competitors in the television market in 2020, %
Diagram 13. Dynamics of the total revenue of the largest television market operators (TOP-5) in India, 2016–2020, billion Rs.
Diagram 14. Compactness of location of companies in the industry in certain regions, 2020, %
Diagram 15. Forecast of the TV market volume in 2021–2025, billion Rs.
Tables
Table 1. TV Industry Gross Margin vs. All Industries in India, 2016-Jun 2021, %
Table 2. Absolute liquidity of the television industry compared to all sectors of the Indian economy, 2016-Jun. 2021, times
Table 3. Consumer price indices in the television market for India in 2016-Sep. 2021, %
Table 4. Average prices in the television market by Union Territories, 2016-Aug. 2021, Rs./month
Table 5. STEP analysis of factors influencing the television market
Table 6. Main companies participating in the television market in 2020
Table 7. Assessment of the impact of recent crises on the industry
Table 8. Analysis of the impact on the industry of the state aid proposed as of April 16.11.2021,
Table 9. Forecast indicators of the development of the Indian economy
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