Media and Entertainment

SUMMARY

• INR 204 Billion film industry by 2019.
• INR 1,026 Billion in 2014 revenues.
• The second-largest TV market in the world.
• 168 Million Television households in 2014.
• INR 45 Million animation industry.
• 800 TV channels.

FDI POLICY

Broadcasting Carriage Services:

• Foreign Direct Investment (FDI) in Teleports, DTH, Multi-System Operator, cable networks in DAS areas, mobile TV, Headend-in-the-Sky Broadcasting Services are allowed up to 74% with FDI, up to 49% under the automatic route. FDI beyond 49% (up to 74%) is permitted under the government route.
• FDI in local cable networks and MSO in non-DAS areas is allowed up to 49% under the automatic route.

Broadcasting Content Services:

• FDI in FM radio is allowed up to 26% under the government route.
• FDI uplinking of ‘News and Current Affairs’ TV channels is allowed up to 26% under the government route.
• FDI uplinking of ‘Non-News and Current Affairs’ TV channels/downlinking of TV channels is allowed up to 100% under the government route.

Print Media:

• 26% FDI under the government approval route is allowed in the publishing of newspapers and periodicals dealing with news and current affairs.
• 26% FDI under the government approval route is allowed in the publication of Indian editions of foreign magazines dealing with news and current affairs.
• 100% FDI under the government approval route is allowed in publishing/printing of scientific and technical magazines/specialty journals/periodicals.
• 26% FDI under the Government approval route is allowed in the publication of facsimile editions of foreign newspapers. However, foreign investment up to 100% is allowed in the case of foreign publishing houses bringing out facsimile editions of their own newspapers through a wholly-owned subsidiary.

Disclaimer: Investments are subject to fulfilling security conditions, rules and regulations of the Ministry of Information and Broadcasting, and all other relevant legalities

SECTOR POLICY

• In December 2011, the Indian government passed ‘The Cable Television Networks (Regulation) Amendment Act’ for the digitization of cable television networks by 2014, cable operators under the digitization regime are legally bound to transmit only digital signals, while customers can access subscribed channels through a set-top box (STB).
• In phase I and II, 33 Million STBs have been installed. For phases III and IV, it is estimated that around 110 Million STBs will be required.
• Co-production treaties with various countries such as Italy, Brazil, the UK, and Germany are to increase the export potential of the film industry.

FINANCIAL SUPPORT

PROVISIONS OF THE 2015-2016 UNION BUDGET:

• INR 1000 Million has been allocated to encourage the growth of community radio stations.
• INR 5000 Million has been allocated for launching a pan-India program named Digital India and a national rural internet and technology mission for services in villages and schools, training in IT skills, and e-Kranti for government service delivery and governance scheme.
• INR 1000 Million has been allocated for launching a program to promoting good governance.
• Basic customs duty on digital still images video camera with certain specifications reduced to nil.
• Service-tax to be levied on service provided by way of access to amusement facilities, entertainment events or concerts, pageants, non-recognized sporting events, etc.

State Incentives

• Available depending upon the number of jobs created, area of investment, etc.
• Animation and gaming: incentives for units in SEZ as specified in the Act

INVESTMENT OPPORTUNITIES

Television:

• Television is projected to garner half of the media and entertainment pie by 2015 (as addressable digitization is expected to cover the entire country by then).
• Television advertisement revenue is also expected to witness robust growth and increase from INR 155 Billion in 2014 to a projected INR 299 Billion by 2019.
• India is emerging as the teleport hub of Asia. 86 teleport permissions have been issued by the Ministry of I&B.

Print:

• The print industry has grown from INR 176.4 Billion in 2014 to reach INR 280 Billion in 2019 at a CAGR of 9.7%.
• Newspapers and niche magazines are likely to drive industry growth.
• Accelerated growth is forecast in regional print and local news segments.

Films:

• The size of the Indian film industry is expected to reach INR 204 Billion by 2019, up from INR 126.4 Billion in 2014.
• An increasing number of digital screens and 3D films are expected to help industry growth.
• To promote joint productions, co-production agreements have been signed with Italy, Germany, Brazil, the UK, France, New Zealand, Poland, Spain, Canada, China, and Korea. An agreement with Australia is in the pipeline.
• In order to promote India as a location destination for foreign production houses, the government is setting up a film facilitation unit with the help of the National Film Development Corporation for the facilitation of film shooting in India.

Radio:

• The size of the Indian radio industry was INR 17.2 Billion in 2014 that grew at a CAGR of 14.5% from INR 10 Billion in 2010.
• The radio industry is expected to grow at a CAGR of 18.1% to reach INR 39.5 Billion by 2019.
• Phase-III of e-auctions for FM radio licenses will provide an impetus to the segment.

Music:

• The size of the music industry is estimated at INR 9.8 Billion in 2014 and is expected to at a CAGR of 14% over the period 2014-19.
• Mobile VAS and the arrival of 3G are likely to lead to a surge in paid digital downloads.
• Phase-III radio licensing will also help in increasing music revenues from a radio.

Animation & VFX:

• The Indian animation industry was worth INR 45 Billion in 2014 and is expected to expand at a CAGR of 16.3% reaching INR 95.5 Billion by 2019.
• Growth in international animation films, especially 3D productions, and the subsequent impetus for Indian production houses will further help growth in this segment.