By Abdi Ali
Published September 20, 2018
The borders that once separated the entertainment and media (E&M), technology and telecommunications industries across Africa are blurring in the battle for the attention of the consumer in a world that is rapidly digitising.
Entertainment and Media Outlook: 2018 – 2022, an annual report by PricewaterhouseCoopers LLP (PwC) says that as the mobile device cements itself as the pre-eminent source of the E&M experience, the most disruptive, forward-thinking companies are striving to create an integrated ecosystem suited to this consumer-driven dynamic.
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PwC says the report is a five-year forecasts of consumer and advertising spending across internet, data consumption, television, cinema, video games, e-sports, virtual reality, newspaper publishing, magazine publishing, book publishing, business-to-business (b2b), music, out-of-home (OOH) and radio in Kenya, Tanzania, Ghana, Nigeria and South Africa.
“It’s clear we’re in a rapidly evolving media ecosystem that’s experiencing Convergence 3.0. In Convergence 3.0, the dynamics of competition are evolving while a cohort of ever-expanding super competitors and more focussed players strive to build relevance at the right scale. And business models are being reinvented so all players can tap into new revenue streams, by, for example, targeting fans and connecting more effectively with customers to develop a membership mind-set,” says Vicki Myburgh, E&M Leader for PwC Southern Africa. “The pace of change isn’t going to let up anytime soon. New and emerging technologies such as artificial intelligence and augmented reality will continue to redefine the battleground. In an era when faith in many industries is at a historically low ebb and regulators are targeting media businesses’ use of data, the ability to build and sustain consumer trust is becoming a vital differentiator.”
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While Kenya’s E&M industry saw 17% year-on-year growth in 2017, propelled by growth in the Internet sector, an 11.6% compound annual growth rate (CAGR) will take the country to US$2.9 billion in 2022, from US$1.7 billion in 2017. Outside of the Internet space, TV and video revenue dwarfs the other segments.
Total E&M revenue in Tanzania stood at US$496 million in 2017, having risen 28.2% year on year. Continued momentum at an 18.3% CAGR will see revenue reach US$1.2 billion in 2022, 2.3 times the size of the market in 2017. Internet revenue takes a slightly less dominant position in Tanzania.
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Ghana’s E&M industry has more than tripled in value since 2013. Total revenue reached US$752 million in 2017. It is forecast to surpass US$1 billion in 2019 and to total US$1.5 billion in 2022, increasing at a 14.2% CAGR. Here, Internet access spend accounts for much of this revenue and growth. Ghana is in a strong position for further E&M growth as revenue gains critical mass over the next five years.
Nigeria saw a huge 25.5% rise in E&M revenue in 2017 to US$3.8 billion, although US$605 million of this US$764 million rise was attributable to Internet access. A 21.5% CAGR rate is anticipated to 2022, with revenue reaching US$9.9 billion in that year. Again, Internet access revenue will account for 89.6% of this absolute growth.
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Between them, the five countries considered in the Outlook will, driven by Nigeria, add US$12.4 billion in revenue from 2017 to 2022, at a combined CAGR of 11.9%. Although much of this will fall into the hands of telcos, there are significant opportunities for content providers too. The engine of growth here will be organic, with increased populations and gradually increasing disposable income swelling the ranks of potential E&M consumers – and ever-increasing Internet access greatly expanding the range of E&M opportunities available.
“To succeed in the future that’s taking shape, companies must re-envision every aspect of what they do and how they do it. It’s about having, or having access to, the right technology and excellent content, which is delivered in a cost-effective manner to an engaged audience that trusts the brand. For those able to execute successfully, the opportunities are legion,” Myburgh says.
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