Britons will spend more on streaming than legacy TV services by 2025, according to PwC’s latest Global Entertainment & Media (E&M) Outlook 2023-2027.
The consultancy said UK E&M revenue is expected to reach £85 billion this year with growth forecast at a compound annual growth rate of 4% over the next four years to generate revenue of £100 billion overall by 2027.
However, varying economic conditions could cause the amount of growth to vary year-on-year.
Mary Shelton Rose, partner and UK Technology, Media and Telecoms Leader at PwC, said:
“2022 was a challenging year for the UK entertainment and media industry as the economy struggled to return to normality. In the midst of continued change and disruption, the industry reassessed its strategies and refocused on core operations.”
“For years, the overarching story in E&M has been a technology-inspired shift to digital and mobile. But this year, very quickly, a new force is coming into focus: Generative AI. Going forward, leaders must evaluate and embrace the potential power of AI holistically as an enabler for productivity and creativity.”
Subscription video on demand (SVOD) revenue is forecast to grow from £3.6 billion this year to £4.7 billion by 2027. In 2025 it is forecast that SVOD (£4.2 billion) will overtake TV subscriptions (£4.1 billion) in terms of revenue reflecting a shift in audiences from linear to streaming.
Globally, the major SVOD players continue to invest in content rights and original productions to maintain popularity with customers. However, the emergence of advertising-based video on demand offers consumers the chance to switch away from subscriptions models.
Overall advertising revenue in the UK is expected to be £35.7 billion in 2023, within which digital captures the lion’s share – as the accelerated structural shift during Covid has remained in place.
