Trends & Analysis of the Past, Present & Future of the Indian Film, TV, Digital, Animation, Music, Radio, Media & Entertainment Industry as of 2018.

1. The Indian Media &
Entertainment Industry
2018
Trends & Analysis - Past, Present & Future
Chaitanya Chinchlikar
Vice President – Whistling Woods International
chaitanya.c@whistlingwoods.net

2. 1308
1473
1658
2033
0
500
1000
1500
2000
2500
2016 2017 2018 2020
INRBillions
Indian M&E Industry
The Indian M&E Industry - High-volume, low-value.
The Indian Media & Entertainment Industry includes
Film, Television, Print, Digital Media, Animation & VFX, Gaming, Radio, Music,
Events & Live Media, Sports, Out-of-home, Theme Parks & other media.
• Valued at over US$ 22.7bn
(1,47,300Cr INR) in 2017
which is ~1.15% of the
global M&E industry
(estimated at US$ 1.95tn)
• Growth from 2016-21 (11.6%)
is going to be over 2x of the
global M&E industry (5.1%)
• Growth of M&E is outpacing
India’s GDP growth by 50%
12.6%
11.6%

3. Industry Breakdown
45% 45% 44% 42%
23%
21% 20%
18%
9%
11%
10%
9%
7% 8% 9%
11%
4% 5% 5%
6%
4% 4% 5% 5%
2% 2% 2% 3%
2% 2% 2% 2%
2% 2% 2% 2%1% 1% 1% 1%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2016 2017 2018 2020
TV Print Film Digital Animation & VFX Live Events Gaming OOH Radio Music

4. Where is the growth coming from?

5. Contribution of M&E in India’s economy

6. 122
156 166
192
0
50
100
150
200
250
2016 2017 2018 2020
INRBillionsThe Indian Film Industry
• Largest in the world by films
produced (~1,900) & tickets
sold (~4bn).
• In value terms, is at US$ 2.3bn.
• 2017 was a phenomenalyear
with 27% growth.
27.9%
70%
62% 62% 61%
7%
16% 15% 15%
13% 12% 12% 11%
5% 5% 6% 8%
5% 4% 5% 5%
0% 1% 0% 0%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2016 2017 2018 2020
Domestic Theatrical Overseas Theatrical Cable & Satellite Rights
Digital / OTT In-Cinema Advertising Home Video

7. Tourism Impact – 3 Idiots & Leh
Value Added by film-
induced tourism
- 4x revenue of the film
- 500x employment
generation

8. 2017
Hindi 265
Tamil 310
Telugu 325
Kannada 210
Malayalam 150
English 150
Bengali 100
Marathi 120
Guajrati 75
Bhojpuri 80
Punjabi 40
Odiya 30
Others 80
1,935
The Indian Film Industry = ‘Bollywood’
While‘Bollywood’ is often a commonly used term to
define the Indian Film industry, Hindi films accounted for
only 14% of the 1,900+ films in 2017.
The South Indian Film industry accounts
for almost 50% of the films made.
Regional Cinema BO:
• Telugu growth at 47%
• Tamil de-growth by 5%
• Gujarati growth at 44%
• Malayalam growth at 38%

9. The steady growth of Marathi
- The number of Marathi films had slipped into single digits in late 90s / early 2000s.
- Today, there are ~120 Marathi films annually.
320 330
400 400 400
500
1100
0
200
400
600
800
1000
1200
INRMillions
Marathi Films Box office Collection
- Discerning plots and
progressive subjects are
balanced with rom-com &
humour
- Sairat became the 1st
Marathi film to cross 100Cr
at the Box Office.
- ROI for Marathi films is
excellent, probably one of
the best among all of the
film industries

10. Hollywood in India – Good growth
- Between 100-150 Hollywood films
release in India annually.
- Hollywood films have never had
more than 10% market share of the
Indian M&E industry.
- Dubbed versions of Hollywood fimls
have enabled viewership & revenue
growth.
- With growing internet access and
general awareness of global
cultures, the cultural alienation
between Hollywood & Indian
cinema is reducing.
27%
33%
15%
27%
45%
21%
41%
58%
0%
10%
20%
30%
40%
50%
60%
70%
2014 -
Guardians
of the
Galaxy
2014 -
Captain
America
Winter
Soldier
2015 - Star
Wars VII
2015 - Ant
Man
2015 -
Avengers
Age of
Ultron
2016 -
Finding
Dory
2016 -
Captain
America
Civil War
2016 -
Jungle
Book
% Contribution of Dubbed Films
1.6
3.4
4.8
0
1
2
3
4
5
6
2015 2016 2017
INRBillions
Box Office Collection - Top 10
Hollywood Films

11. Film – Revenue Split
When you pay Rs 100 for a movie ticket, what is the split?
• Gross – 100% (Rs 100)
• Entertainment Tax – 30% (Rs 30)
• Exhibitor – 50% of balance 70% (Rs 35)
• Distributor – 50% of balance 70% (Rs 35)
• Producer(s) / Co-producer(s) – depends on what deal they have made
with distributor – Outright / MG / Commission / Distribution Fee – and
with each other.
• P&A funding – deal specific, but usually is Last-In-First-Out.
• Talent – actors / director – may or may not have sweat equity.

12. Exhibition – Poised to grow!
125
60
40
16
10 8
0
20
40
60
80
100
120
140
US UK South
Korea
China Brazil India
Screens/Million
4,723
18,195
40,000
10,635 9,951
9,530
39,233 40,024 40,393
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
2009 2013 2017
China India US
-
2,000
4,000
6,000
8,000
10,000
2009 2011 2013 2015 2017
925 1,225 1,500
2,100
2,750
9,710
9,121
8,451
7,400
6,780
Multiplex SingleScreen
3.5
4.7
5.7
6.5
7.5
1.4 1.4 1.5 1.4
1.7
-
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
2013 2014 2015 2016 2017
Billion$
Domestic Box Office Size
China India
Factoid:
Multiplex growth at 14%; F&B+Advertising growth at 21%.

13. Education
India USA
Population 1.25bilion 300million
No of Films being made 1800+ 400+
No of world-class film
schools
4-5 150-160
No of graduates from
these schools each year
300-500 15,000+
• Almost 75%+ people involved in the creative process of Filmmaking are
not formally trained / educated in film
• Despite having 17% of the world’s population and 9% of the economy,
the Indian M&E industry is only 1% of the world’s M&E industry
• We do not make films that appeal to the rest of the world and hence end
up leaving out a massive market for our content.
• We need 5-times as many
graduates each year
• We have no globally
merchandisable IP
• Affects all areas of M&E
Film, TV, Journalism, Events, etc.

14. The Indian Film Industry - Key points
• Urgent and significant scale needed in Film education.
• Screens need to double in 5 yrs; Government intervention underway.
• Globally-merchandisable, home-grown IP(s) development underway.
• Regional shows its importance – Telugu, Marathi, Gujarati, Punjabi
• Hollywood films box office growing (on the back of dubbed films),
though not as much as domestic content.
• Funding avenues, beyond the studios grow with banks, Film Funds,
Crowd-funding all becoming serious options.

15. 594
660
734
862
0
200
400
600
800
1000
1200
2016 2017 2018 2020
INRBillions
TV
The Indian Television Industry
• The most consistently
performing sector of the
Indian M&E Industry.
• It is, presently, over 4 times
the size of the Indian Film
industry and is the largest
employer in the M&E space.
• The TV pipeline has almost
1500 MSOs, 60000+LCOs,
6 DTH operators, 2 IPTV
Operators and over 850
channels.
11.1%
9.8%
Value headroom - Average subscription
rate for Cable TV / DTH:
• India – 3-4$ per TV per month
• US / UK / Europe – 60-100$ per TV per
month

16. Penetration
0
50
100
150
200
2016 2017
100.5 99
49 52
26 31
0.5 1.5
Millions
Subscribers
Cable DTH Free TV HITS

17. TV Channels, Viewership
• India has added, on an avg, 4.25
channels/month for the last 10 yrs.
• India has over 380 news channels.
• Channel differentiation is weak.
5 55 130
263
550
800
877
0
100
200
300
400
500
600
700
800
900
1000
1990 1995 2000 2005 2010 2015 2017
Channels & Growth
No of Channels
GEC
54%Movie
23%
News
7%
Music
6%
Kids
6%
Sports
3%
Others
1%
Viewership
GEC
Movie
News
Music
Kids
Sports
Others
• With over 75% of viewership of
GEC / Movies, people still prefer
fiction / escapism on TV
• The ones that don’t, are not
watching TV anymore and have
switched to OTT

18. GEC – GRP v/s Profitability
Low Viewership High Vieweship
Low
Profitability
High
Profitability
Long running soaps
Low-cost game /
performance based
reality shows
Mythological series
Recently released movies
Celebrity-based shows
Why do we see what we see on GECs?
How does programming get divided between building a viewer base and profitability,
thorough the application of the concept of ‘stick-ability’!
Finite
Fiction Series

19. TV Revenues – Getting better, slowly!
• Growth in subscription revenue
expected to bring about more money
to the broadcasters which in turn will
fund more innovative content.
• A 25%-odd revenue share by
broadcaster is still much lower than
what they should receive.
351
393
430
494
243
267
304
368
0
100
200
300
400
500
600
2016 2017 2018 2020
INRBilions
TV Revenues - Split & Growth
Subscription Revenue Advertising Revenue
351
393 430
494
90 99 109 125
25.64%
25.19%
25.35%
25.30%
24.90%
25.00%
25.10%
25.20%
25.30%
25.40%
25.50%
25.60%
25.70%
0
100
200
300
400
500
600
2016 2017 2018 2019
INRBillions
Subscription Revenue
Paid by Consumers Recd by Broadcasters %

20. Indian Animation picks up
• Broadcasters are willing to pay over
double for good quality Indian
Animated content as compared to
daily soaps / Hindi general
entertainment content, even though
this segment gets only 6% of the
viewership, as compared to 54% for
Hindi GECs.
• Also the fact that this segment
continues to be under-indexed
doesn’t bother broadcasters as this
content has long-tail revenue
• It offers repeat viewing value, multi-
language dubbing value and
merchandising value.

21. GEC Finite Fiction– a still-born attempt
• GECs, after decades,finally
embraced the tele-series format
with season-based programming
• For the past 20-odd years, the
content has largely mirrored
American programming of the 70s-
80s, with our soaps comparable to
content like the Bold & The
Beautiful, Santa Barbara, etc.
• This experiment was still-born.
Viewership/ad-revenue increase
was not commensurate to
increased production values

22. TV – Key Points
• Digitisation – increased revenue for the broadcaster, should
lead to more investment in content (& hence better quality
content)
• Global proliferation of Indian-origin content is increasing,
albeit for the Indian diaspora only. This is THE BIG
opportunity.
• Indian animation on TV is starting to matter.
• Indian TV needs a BIG shake-up. Has been stagnating for a
while now.

23. 92
119
151
224
0
50
100
150
200
250
2016 2017 2018 2020
INRBillions
Digital
Digital – Growth galore!
• The Digital industry is expected to
double from 2017-20, both by way
of market size & internet users.
• India is already the 2nd largest
internet using country in the world.
772
462.12
312.32
149.06143.26118.63109.5598.39 8580.4879.13 67 6463.0660.42 57 56.754.851.848.21
0
100
200
300
400
500
600
700
800
900
29.3%
24.9%
Data Cost – rapid
decline
From Rs 16/GB in 2016,
it has reduced to
< Rs 4/GB in 2018

24. Telecom Base – Data is the new Oil!
Tele-Density: 90.44.
Urban: 154.77, Rural: 58.09
Telecom
Company
Subscribers
(As of July 2018)
Voda + Idea 443,946,206
Bharti Airtel 344,877,404
Jio 227,052,331
BSNL 113,341,748
Tata 24,265,937
MTNL 3,515,341
Reliance 45,541
TOTAL 1,157,044,508
Telecom Service
Provider
Broadband
market-share
Cost
(Rs/GB)
Jio 44% 3.55
Airtel 20% 5.08
Vodafone 14% 5.64
Idea 10% 5.99
BSNL 6% 4.58
Others 6% 4.85
80
3
45
7
0
10
20
30
40
50
60
70
80
90
US India
US$
Monthly Cost
Cable OTT

25. Massive increase in India’s online video audience
India’s
online
video
audience
to double
in 3 yrs.
Hindi
63%
Other
Regional
Languages
30%
English
7%
Time
Spent
on
Digital
Content

26. 49%
75%
39%
16%
10% 6%
2% 3%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2016 2021
File Sharing
Streaming
Audio
Web &
Other Data
Video
The Digital Business – A BLITZ of growth!
0
100
200
300
400
500
600
700
800
900
1000
2016 2017 2018 2019 2020 2021
22 24 26 29 32 35
390
475
575
690
821
969
MilionsofUsers
Internet Users
Wired Wireless
-
50.0
100.0
150.0
200.0
250.0
2016 2017 2018 2020
89.2
114.9
145.5
203.6
2.6 3.9 5.7
20.1
INRBillions
Digital Industry Revenue
Advertising Subscription
0
100
200
300
400
500
2017 2021
295
400
186
429
Users(millions)
Internet Users
Urban Rural

27. Global Digital Platforms

28. Indian Digital Platforms
& many more…

30. What Apps are people downloading?
Social Media still #1
Entertainment is the
fastest growing
segment

31. Opportunities in Digital
• Digital is no more a ‘also’ platform. It is the present & the future.
• Content consumption modes & patterns are changing with a large number of sub-
18-yr-olds finding their ‘stars’ online.
• Industry should look at digital beyond JUST a 3rd screen with limited censorship.
• Multi-formatting ALL content to include Digital platforms (25% extra effort)
• Digital is a writers’ medium - New IP Creation (akin to novels)
• Digital is all aboutAnalytics - Audience analytics, Content-based analytics,
Predictive analytics, Campaign analytics, etc
In any industry, building volume is hard. India already has the volume and is
likely to be the largest digital market (free) by 2021-22. We now need to build
value to each unit of volume. Only way to do it is quality.

32. Content vs Experiences
Technology-enabled experiences in content consumption are
what the consumer is seeking out.
While the ‘idea’ is important, what is equally important is the
consumption experience.

33. VR’s expected journey from 2018-2021
• The first generation of Cinematic VR content creators to emerge
• Stabilisation of VR workflow using the OMAF / HEVC / MPEG-H
codecs
• Cameras / acquisition rigs to get better. Better sensors, lensing,
and heat & data management.
• Distribution to settle down on a Viewport+Extra base
• HMDs to get better
• Business models / consumer segments to emerge:

34. VR Business Models (hypothesis)
Low Volume High Volume
Low
Value
High
Value
Tethered
HMDs
Location-Based VR
experiences
Wireless
connected
HMDs
Mobile + Headset
Home-based Seated /
Multi-sensory narrative
experiences

35. Platforms
Low Volume High Volume
Low
Value
High
Value
Premium DVOD
(Netflix, Hulu,
Amazon Prime,
etc)
Theatrical
360 VR
Content
Free(mium) Digital Platforms
(Youtube / ALT / Hotstar, Voot,
Viu, etc
C&S / DTH
There are 5 viewing platforms presently. On a viewership & value matrix,
this is where are they now & where are they likely to be 5 yrs from now.
Note:
This is India-specific

36. 26
30
40
68
0
10
20
30
40
50
60
70
80
2016 2017 2018 2020
INRBillions
Gaming
Gaming
• Grew over 15%, on the back of
mobile gaming.
• There is an obvious correlation
between in smartphone + internet
growth and gaming growth.
27.5%
15.4%
As of 2018, Grand Theft Auto 5
became the single most profitable
piece of media of ALL TIME
Produced at a cost of US$265mn, it
has aggregate revenues of over
US$6bn as of April 2018.

37. Global Snapshot - Gaming & E-sports
• In the US, Gaming accounted for over 50% of the total Media &
Entertainment Market share in 2017. India was 2%. There is enormous
potential for Gaming as an industry.
• The global e-sports market, which is US$ 655mn in 2017 is expected to
reach US$ 900m+ in 2018 & US$ 1.65bn by 2021.

38. 54
67
80
114
0
20
40
60
80
100
120
2016 2017 2018 2020
INRBillions
Animation, VFX & Post-Production
• The industry has shown growth / will
continue to grow on the back of strong
VFX / post-prodn growth, but Animation
has not grown as much.
• Lack of original IP is the major reason
of low growth in Animation.
• Cost arbitrage is the key driver for
animation services. Cost of producing a
full-length animated film in the US is
US$ 71-106 mn, in India is US$ 13-22
mn, a saving of approximately 80%.
• More 3D films = more conversion work
= more post-prodn revenues for India.
20.4%
24.1%
15.0 17.0 18.9 23.2
15.9
18.3 20.9
26.9
23.2 31.3 40.6 63.5
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2016 2017 2018 2020
INRBillions
VFX
Post-
Prodn
Animation
Services

39. VFX & Post-Production
Increased high-end domestic content
(Film / TV / Digital) has caused
increased demand for VFX / post-
production services
Good News -
India has gone
from NIL to
‘Emerging’ in the
Conceptualisaton
stage of global
VFX films

40. Live Events
• Still largely unorganised
• Licensing & Taxation issues
• IPs generate a disproportionately high
proportion of revenue
• Corporates accountfor 75% of the
organised industry’s revenues
56
65
77
109
0
20
40
60
80
100
120
2016 2017 2018 2020
INRBillions
Live Events
16.1%
18%

41. 24
26
28
34
0
5
10
15
20
25
30
35
40
45
50
2016 2017 2018 2020
INRBillions
RadioRadio
• Growth has been volume driven –
more stations in more towns / cities.
• India lacks a listenership
measurement system.
8.6%
8.3%
What’s New?
Transit Radio
• RMirchi – Delhi Airport
• Red FM – Shatabdi
• RCity – Lucknow Metro

42. 12
13
14
18
0
5
10
15
20
25
2016 2017 2018 2020
INRBillions
Music
Music
• Over 50% of Indian web users access
unlicensed content.
• Limited high-quality, full-time, structured
career-education in Music.
• Growth is coming from streaming
10.6%
8.3%
65%
11%
15%
9%
Consumption Breakdown
Digital
Physical
Syndication
Public Performance
60.0%20.0%
20.0%
Source
Hindi
Regional
International

43. Sports
• Sports is one of the
largest content
providers to the
broadcast, live events
& digital industries.
• BCCI continues to be
the most efficient &
productive sports body
in India.
• Kabaddi warrants
multiple case studies.
The ‘sports-watcher
stereotype’ has been
broken with 35%+ female
& 40%+ rural viewership
for India’s top 3 leagues.

44. Theme Parks
• Current size Rs 29.3 billion. Expected to grow to Rs 70
billion by 2021 with a 19.1% CAGR.
• Destination tourism built around Theme Parks yet to
materialise in India
• Evolution:
o 1980s – Appu Ghar
o 1990s & 2000s – Esselworld
o 2010s – Imagica & Wonderla
o 2016 – INR 300 bn+ investment committed for 10 parks across India

45. Jobs in M&E
• Direct employment is ~7.5L. Indirect is ~23.5L
• TV is the largest employer (~5L), followed by Film (~2.5L).
• As per the NSDC, by 2022, the Media & Entertainment industry would be
requiring 16.5 lakh professionals, ~85% of these in the Film, TV & digital
verticals.
• The media industry as a whole still lacks sufficient world-class training
facilities to enable professionalism and best practices.
• Significant government-intervention and private investments will be
needed to correct this imbalance.

46. The Great Opportunities in M&E
In the M&E industry, building volume is hard. India already has the
volume. We now need to build value to each unit of the already
existing volume.
This can only be done by enhancing quality.
The big opportunities in Indian M&E are:
• Education in M&E
• Globally Merchandisable IP
• Content that travels well globally (to non-diaspora viewers)
• IP creation - interoperable IPs across Film, TV, Digital
• Screens for Film

47. Thank You!
Chaitanya Chinchlikar
chaitanya.c@whistlingwoods.net
Business Head, Whistling Woods International
Chief Technology Officer, Whistling Woods International
Lab Head, Whistling Woods Jio VR Lab