Film Sector Summary

According to a report in 2000 by Pricewaterhouse Coopers, the film entertainment industry is one of the fastest growing sectors in the world economy. In South Africa, the term “film industry” is generally used to describe an umbrella of creative industry production activities including film, television (drama and documentary), commercials, stills photography and multi-media. Economically the sector turns over billions of dollars and generates millions of jobs worldwide. In 1997, the global entertainment industry generated US$172 billion. It is estimated that the value of this industry in the European Union is set to grow from R300 billion to R800 billion in 2010. In the US, film is the second largest export business after aerospace. In a recent study Price Waterhouse predicted the growth of various digital media platforms in the Europe, Middle East and Africa as follows:

Filmed Entertainment
Global facts and forecasts:

• “In EMEA (Europe, Middle East, Africa) online subscription services and video streaming services are entering the market. Together they will reach R2.2 billion by 2010 from only R216 million in 2005, averaging 59.1 percent growth compounded annually.”

Television Networks: Broadcast and Cable
Global facts and forecasts:

• “The United Kingdom and Germany are the two largest markets in EMEA, at R10.7 billion and R10.1 billion, respectively, in 2005. Italy ranks third, at R7.8 billion, and we expect it will reach the R10-billion threshold in 2010.”
• “The television network market in Canada will expand at a relatively steady 4.3 percent compound annual rate to R4.5 billion in 2010 from R3.7 billion in 2005.”

Television Distribution
Global facts and forecasts:

• “Italy will be the fastest-growing country in EMEA, with 22.9 percent compound annual growth, fueled by a rapidly expanding satellite market and growing IPTV.”

Recorded Music
Global facts and forecasts:

• “Licensed digital distribution will rise from R653 million in 2005 to R4.9 billion in 2010, a 49.5 percent compound annual increase. From a 5 percent share in 2005, digital distribution will constitute 33 percent of recorded music spending in 2010.”
• “The launch of new digital distribution services and growth in the number of broadband Internet subscribers in EMEA will fuel digital download spending.”

Radio and Out-of-Home Advertising
Global facts and forecasts:

• “We project the radio and out-of-home market in EMEA will expand from R23.1 billion in 2005 to R29.2 billion in 2010, growing at a 4.8 percent compound annual rate.”

Video Games
The video game market reflects consumer spending on console games (including handheld games), personal computer (PC) games, online games, and wireless games. The category excludes spending on the hardware and accessories used to play the games.
Global facts and forecasts:
• “In EMEA the online game market will be driven by increased penetration of the broadband subscriber market as well as by the new consoles, which will emphasize online play.”

Business Information
Global facts and forecasts:

• “In EMEA industry information will total an estimated R9.2 billion in 2010, up from R7.1 billion in 2005, a 5.4 percent compound annual increase.”

Global facts and forecasts:

“In EMEA sponsorships, merchandising, and other revenue will rise to R10.1 billion in 2010, an 8.9 percent compound annual gain from R6.6 billion in 2005.”

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