PwC: Content Boom Has Halted

The entertainment and media (E&M) industry worldwide hit a value of $2.8 trillion in 2023, a 5 percent gain, with a more modest 3.9 percent compound annual growth rate (CAGR) projected for the next five years, reaching $3.4 trillion in 2028, according to PwC’s latest outlook.

Advertising is a key growth area, with spend projected to top $1 trillion in 2026. “With advertising accounting for 55 percent of total E&M industry growth over the coming five years, it is poised to become a more important part of companies’ business models—even for those that had previously avoided ad revenues. For strategic reasons, all participants in the E&M industry need to become more proficient at selling ads—and more effective at making them generate value for all participants in the ecosystem.”

The PwC report highlights the connected TV advertising opportunity, which is expected to double from $20.5 billion in 2023 to $41.2 billion in 2028. “As more consumer attention migrates away from traditional television to user-generated, short-form content, advertisers may need to follow this migration with approaches that go beyond the 30-second or 15-second spot. These may include relying more on influencers, offering experiential promotions, and tapping into new technologies that enable creative messaging.

PwC also urges companies to reinvent business models amid the plateauing of streaming service revenues. By 2028, PwC projects global subs of 2.1 billion, up from 1.6 billion in 2023, a 5 percent CAGR. Global ARPU for OTT subs will inch up to $67.66 from $65.21. “This plateauing effect is already pushing leading streamers to reshape their business models and find new revenue streams beyond subscriptions,” PwC says. This includes hybrid tiers, with PwC highlighting that advertising will account for about 28 percent of global streaming revenues by 2028, up from 20 percent in 2023. Bundling will be key to the streaming economy going forward.