LONDON—Traditional TV is heading for uncharted territory according to PwC’s “Global Entertainment & Media Outlook 2019-2023,” a forecast that would see a dip in TV’s compound annual growth rate for the first time.
Covering 14 industry segments in 53 territories, PwC’s “Outlook” projects that global spending on entertainment and media will increase at a CAGR of 4.3% by 2023, increasing the industry’s global revenue to $2.3 trillion. However, traditional TV is not expected to be one of the industry segments contributing to that growth.
Traditional TV, coupled with home video, has a negative growth expectation in the time frame covered in the PwC study. The rise of cord-cutting is a key factor in this, as OTT video is the projected to be the second largest contributor to the CAGR behind virtual reality, part of consumer’s desires to have personal, curated entertainment and media experiences.
“Advances in technology and service offerings are finally enabling people to move from passive to active consumption—not just individual pieces of media, but of media as a whole,” PwC writes. “One is the trend for consumers to reject the bundles of channels offered by cable or satellite providers, and instead construct their own ad hoc bundles made up of OTT services.”
Global OTT revenue is expected to double from what it was in 2018 ($38.2 billion) by 2023.
The emergence of 5G could also play a factor in the fight between traditional TV and OTT, as one of the key impacts of 5G will include the streaming of more high-quality video for live sports or other events.
Read the full PwC report here.