PwC recently released its annual five-year forecast for entertainment and media, dropping the growth rate for ad spending on TV. Last year’s report projected a 5.5 percent annual increase in ad spending over the next five years. PwC has revised that figure to 4 percent through 2019, as original programming from streaming services such as Netflix and Amazon continues to compete with traditional television content. In the U.S., the number is even lower; ad spending on TV has been growing 3 percent annually on average.
PwC says that streaming services are luring television viewers away from traditional ad-based programming.
According to Wired, “PwC lumps these services into a category called home video revenue, which is growing quickly in the United States: it’s expected to jump nearly 15 percent annually for the next five years to hit $16.5 billion by 2019.”
“A portion of this growth is coming at the expense of the TV advertising market,” says PwC Director Matthew Lieberman, pointing out that consumers will soon spend more to stream movies and TV shows than what they spend to see movies in theaters.
Other key takeaways from the PwC report, as posted by Wired, include:
- Mobile advertising and social gaming will see steady double-digit growth.
- In the U.S., spending on live concerts and movie tickets will outpace overall consumer spending by 2.9 percent by 2019.
- Mobile advertising in the U.S. overtook display Internet advertising in 2014; next year, it’ll supplant paid searches, the leading ad category. It’s expected to grow 25 percent annually for the next five years and overtake display advertising globally within five years.
- In 2012, 80 percent of Americans paid a subscription fee for TV shows; by 2016, that’ll fall 3 percent, to 76.9 percent.
- Companies make more from consumers downloading music than streaming it, but that’s expected to change. By 2017, revenue from digital streaming will overtake that from digital downloading, and it will continue to jump roughly 11 percent annually.
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