The Outlook provides a single comparable source of consumer and advertiser spending data and analysis for 17 segments across E&M. Explore US topline findings from six of the segments by clicking to the right or scrolling below. The remaining segments include: Book publishing, Business-to-business, Internet access, Internet video, Magazine publishing, Music, Newspaper publishing, Out-of-home advertising, Radio, TV advertising. To explore additional data and highlights on all segments, explore the Global segment findings.
Lured by sequels and trilogies, Americans went to the movies in record numbers in 2016, despite the growing appeal of sophisticated home-entertainment options. Looking ahead, expect revenue growth of 1.3% compound annual growth rate (CAGR), much of it from box-office revenue subsidized by rising admission prices. Ticket prices will increase from $8.68 in 2016 to $9.15 by 2021.
Traditional TV revenue will decrease slightly to $105 billion by 2021, as physical media in the home video segment continues to taper off. Pay-TV penetration will also wane, as business models evolve with customer tastes. However, while penetration declines, we expect growth in subscription revenue over the forecast period, reflecting the shift from securing new subscribers to upselling premium services to current subscribers. These services—such as HD and UHD channels, VOD services and TV Everywhere—will edge up average revenue per user (ARPU).
Fueled by explosive growth—largely in mobile advertising—the United States retains its position as the world's largest internet advertising market in terms of revenue. Mobile advertising surged from 35% of the total revenue pie in 2015 to 51% in 2016. By 2021, mobile advertising will account for a commanding 75% of total internet advertising revenue, a market predicted to be worth $116 billion as a whole. Meanwhile, the lack of effective metrics continues to pose a significant barrier to further growth.
Video game revenue will reach $29 billion by 2021, more than double 2012 revenue of $14 billion. PC games will see healthier growth than consoles, with online and microtransactions registering a robust 7% CAGR over the next five years. An added boost for US PC gaming is the evolution of e-sports (organized video game competitions), on a tear at 23% CAGR for $299 million in revenue by 2021, representing the world's largest e-sports market.
Americans will buy and use some 70 million VR headsets by 2021 at an eye-popping 69% CAGR, indicating the boundless potential in multiple industries for this burgeoning technology. The consumer VR content market, meanwhile, will see a large upswing to $5 billion at 88% CAGR by 2021, powered by spending on VR video (VR-specific entertainment, film and event or sports coverage). In fact, by 2021, VR video will represent 58% of overall content spending in this market.
Global Technology, Media and Telecommunications Leader, Partner, PwC China
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Technology, Media and Telecommunications Advisory Leader, PwC US