How did the media world fare in 2022 and what are the trends that are emerging in 2023 for traditional broadcasters, video and gaming multimedia platforms, the press and music? These are the main questions driving consulting firm Arthur D. Little’s annual industry report on the global media market based on extensive design evidence and interviews with industry practitioners and experts.
The report focused on four main trends: the return to a “new normal” after the pandemic period, the impacts of inflation, the use of new technologies and the consolidation of global players. According to ADL experts, the sector is cautiously optimistic about the future, with new opportunities for growth and differentiation arising from the adoption of new technologies, in various fields (from physical to digital, passing through the metaverse).
Five suggestions for operators in the sector: 1) welcome new technologies, starting from Artificial Intelligence, to improve their operations and reach new customer targets; 2) evaluate targeted acquisitions that can increase the position of companies especially in terms of technology and partnerships in global distribution; 3) strengthen compliance in terms of data protection and security; 4) develop a 360-degree relationship with end customers (Disney model), also with appropriate diversification actions; 5) redesign an effective content strategy, including new formats and technologies, based on a better understanding of customer preferences (data driven strategy).
The Report analyzes global media trends and focuses on their impact on key sub-segments of the media, sports and entertainment industries. The TV, video and film sector continues its inexorable shift towards online, although there has been a recovery in box office receipts, however both consumer spending and advertising spending are moving more slowly towards online. Meanwhile, Connected TV ad spend has experienced explosive growth (+39% 2022 vs 2021) and is expected to triple by 2025, representing a key opportunity for Advertising-VOD models but also for linear models of traditional broadcasters .
As for the gaming sector, although down in 2022 globally, growth is still expected in the medium term (+2% CAGR 2021-2025). In 2022, a process has begun that will see gaming brands access mainstream media. This is the case of Netflix, which bought Boss Fight Games and Next Games. E-sports are also on the rise, with a greater focus on the metaverse. Music streaming is growing (+22% 2022 vs 2020 of subscribers globally), with impacts both in terms of consumer spending and advertising. Increased competition to Spotify from new players like Tencent as well as Apple and Amazon. The acquisition of catalogs of music rights remains a key to success as well as the development of Podcasts.
The press and news sector remains in decline due to the decline in print revenues, still dominant in terms of subscriptions. The growth towards digital is however significant: many newspapers – including the New York Times and the Guardian – have extended the offer of multimedia products, such as videos and podcasts, but also games, in order to diversify revenues and make up for losses of the press.
Finally, the world of books experienced a waning phase in 2022 after the growth that occurred during the pandemic and lockdowns. The slowdown, according to the report, will continue in the coming years, with an increase in the diffusion of audio and e-books. Worth mentioning is the collaboration between publishing houses and social media, in particular TikTok, to convey content to large sections of possible consumers, as well as the appearance (and positioning) of platforms such as Blinkist.