The author takes a look at what the entertainment sector can do to snap out of the slump brought about by the pandemic in 2020…
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2020 was an unprecedented year for every sector, including media and Theatres were forced to close doors, and events like live concerts seemed to be memories of a distant past. Ad spends were slashed, as businesses cut their costs, affecting revenues across the entertainment industry. 10-12% of the country’s cinemas have shut down permanently, as of August.
The situation appeared just as dire in other parts of the world. China was facing the closure of 40% of its theatres, while in the US and UK, the second-largest cinema chain, Cineworld, closed shop. The major multiplex chain AMC Theatres was also threatened with imminent closure. The bright spots in 2020 came in the form of online content (https://brandequity.economictimes.indiatimes.com/tag/online+content), including OTT (https://brandequity.economictimes.indiatimes.com/tag/ott), esports, and online gaming, which saw remarkable growth. The time spent on gaming apps increased by 21% during the initial national lockdown, with the total customer base crossing 300 million users.
The good news is that most experts predict the downturn in the entertainment industry to diminish, as it bounces back with an equal energy. According to a KPMG report, the media and entertainment sector will see a strong revival by FY2022 growing by over 33% from FY2020. While gaming and will lead the recovery, print and TV revenues will also slowly gain ground. This bodes well for the sector, as industries like cinema and TV benefit from revived ad spends.
The situation is seeing some return to normalcy as cinema halls open up in some parts of the country with limited occupancy. The focus, for now, has shifted to bring back audiences and resume operations, while following precautionary measures. However, given the health concerns, the situation is still uncertain. Hence, it is critical that any shift in operations be undertaken with a risk-conscious approach, to mitigate any adverse impact.
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