ENTERTAINMENT INDUSTRY IN INDIA

SWOT ANALYSIS

SUBMITTED BY:-

RAHUL SINGH

2010MB40

OUTLINE
1. INTRODUCTION
1.1 TYPES OF ENTERTAINMENT INDUSTRY

2. SWOT ANALYSIS
DEFINITION
2.1 STRENGTHS
2.2 WEAKNESS
2.3 OPPORTUNITIES
2.4 THREATS

3. CONCLUSION
INTRODUCTION
Entertainment consists of any activity which provides a diversion or permits people to amuse
themselves in their leisure time. Entertainment is generally passive, such as watching opera or a
movie. Active forms of amusement, such as recreations or sports, are more often considered to
be recreation.[1] Activities such as personal reading or practicing a musical instruments are
considered as hobbies.

The industry that provides entertainment is called the entertainment industry. There are many
forms of entertainment for example: cinema, theatre, sports, games and social dance. Puppets,
clowns, pantomimes and cartoons tend to appeal to children, though adults may also find them
enjoyable. The Indian entertainment industry has out-performed the Indian economy. The
industry generally tends to grow faster when the economy is expanding. Above that consumer
spending is also on the rise, due to a sustained increase in disposable incomes, brought about by
reduction in personal income tax over the last decade. All these factors give an impetus to
entertainment industry and are likely to contribute to the growth of this industry in the future.

Entertainment Industry in India comprises of Film Industry and Television Industry. The Indian
entertainment industry is among the fastest growing sectors in the country. In the past two
decades entertainment industry in India has witnessed explosive growth. In television alone,
from a single state owned television network, Doordarshan in 1991, today there are over 300
national, regional and local channels being beamed across the country. Indian film industry is the
largest film industry in the world, producing on an average, close to a thousand films a year in all
languages. In terms of film production India exceeds Hollywood's production volume by over
three times. Some of the fastest growing segments in the Indian entertainment industry include
music, cable and satellite television, animation and FM.

According to an estimate by FICCI and Ernst and Young Indian entertainment industry would
worth more than Rs. 400,000 million in 2008. Several positive developments like the accordance
of the 'industry' status to the film industry, satellite channel penetration, the retail boom in the
channels for music sales (Music World & Planet M), the use of digital technology in all spheres
of entertainment and the growth of multiplexes have contributed to the growth of this sector.
SWOT:-
SWOT Analysis, is a strategic planning tool used to evaluate the Strengths, Weaknesses,
Opportunities, and Threats involved in a project or in a business venture. It involves specifying
the objective of the business venture or project and identifying the internal and external factors
that are favorable and unfavorable to achieving that objective.

The aim of any SWOT analysis is to identify the key internal and external factors that are
important to achieving the objective. SWOT analysis groups key pieces of information into two
main categories:

Internal factors - The strengths and weaknesses internal to the organization.

External factors - The opportunities and threats presented by the external environment.

STRENGTHS

1. Technological innovations like online distribution channels, web-stores, multi- and

mega-plexes are complementing the ongoing revolution and the growth of the sector.

2. Indian film industry is second largest in the world and the largest in terms of the films
produced and tickets sold.

3. The low cost of production and high revenues ensure a good return on investment for
Indian Media and Entertainment industry.

4. Low media penetration in lower socio-economies classes. Though media penetration is

poor in lower socio-economic classes, the absolute numbers are much higher for these
classes.

5. Greater interface with international companies. Large no. of foreign companies invested
in the entertainment industry like MGM, SONY etc.

6. Introduction of Cable Services: Digital mode of delivery of content to television

viewers has been given a thrust by introduction of conditional access system (CAS) in
parts of four metros Delhi, Mumbai, Kolkata and Chennai.
 7. Introduction of Mobile TV: Mobile TV is another mode of distribution of TV channels.
A joint group of Ministry of Information & Broadcasting (MIB) and Department of
Telecommunications (Dot) has considered the regulatory and licensing issues of mobile
TV and held that if mobile TV services are to be provided in the broadcasting mode using
transmission of terrestrial or satellite broadcast sign.

WEAKNESS

1. The Media and Entertainment sector in India is highly fragmented.

2. Lack of cohesive production & distribution infrastructure, especially in the case of music
industry.
3. The lack of efforts for media penetration in lower socio-economic classes, where the
media penetration is low.
4. Lack of empowered regulators. At present, the government has appointed an independent
regulator-TRAI-for only television and radio.
5. Increase in operating costs of various TV channels and due to the introduction of Set Top
boxes.

OPPORTUNITIES

1. The media penetration is poor among the poorer sections of the society, offering
opportunities for expansion in the area.

2. The nascent stage of the new distribution channels offers an opportunity for
development.

3. Rapid de-regulation in the Industry

4. Rise in the viewership and the advertising expenditure.

5. Technological innovations like animations, multiplexes, etc and new distribution

channels like mobiles and laptop.

6. Consumer needs are expanding beyond the mass media and segmented media to Lifestyle
Media, a new approach that will help consumers maximize their limited time and
attention to create a rich, personalized and social media environment.
7. Knowledge of Consumer activity rather than exclusive ownership of content or
distribution assets will become the basis for competition. Businesses that capture
‘consumer activity ‘data and use it to inform business and advertising models will be
positioned to succeed.

8. Media market place will provide a structure to capitalize on the Lifestyle Media
opportunity. Pull oriented media consumption media consumption models such as media
marketplace in which the consumer is furnished with robust search, research
customization, configuration and scheduling tools will capture the opportunity associated
with Lifestyle Media.

9. Early movers in establishing media marketplace will have a significant advantage over
late entrants because of network effects, whereby the value of the market place increases
as the number of participants increase.

10. Significant advancements in audience measurement technology will needed to capture

analyze and standardize consumer activity data across platforms.

11. While technology will make it easier to collect detailed consumer information, privacy
concerns will rise amongst consumers, regulators and privacy advocates.

THREATS

1. Piracy, violation of intellectual property rights poses a major threat to the Media And
Entertainment companies. The problem of piracy assumes a different proportion in a
country such as India with areas of 3.3 million sq .km. and a population of over 1
billion speaking 22 different languages. It impacts all segments of industry especially
films, music and television. Most of the credible efforts today to combat piracy have
been initiated by industry bodies themselves.

2. Lack of quality content has emerged as a major concern because of the 'Quick- buck'
route being followed in the industry.

3. With technological innovations taking place so rapidly, the media sector is facing
considerable uncertainty about success in the marketplace.

4. Lack of a uniform media policy for foreign investment.

The sector currently lacks a consistent and uniform media policy for foreign
investment. Some of the inconsistencies include different caps in foreign direct
investment in various segments. This is enumerated below:
  Television Distribution: DTH 49 %( strategic FDI only 20%)x; cable 49%
(ownership can only be with India citizens).
 Content(news): Television and print-26%

5. Price regulation in the television industry

As per the notification issued by the TRAI, broadcast media pricing has been frozen
for over a year now Though TRAI did allow a 7% inflationary adjustment late in
2004, the inflationary adjustment of 4% in 2005 is under a legal dispute.

6. Cross-media ownership rules

Media integration is an important tool in the hands of media industry which by its
very nature could lead to anti competitive behavior hurting the entire value chain of
the industry. The government has been mulling over evolving cross media rules
ownership for which even a public draft has not been evolved as yet.

7. Tax treatment of foreign broadcasting companies

The tax treatment of foreign companies in the broadcasting sector in India is
emerging as the single most important policy issue determining foreign investment
in the country.

CONCLUSION
All the recent developments have helped in opening new doors for human resources in the
Media And Entertainment sector. In terms of employment, the animations and the special
effects sector of this industry has become a major attraction for the job seekers.

The Indian entertainment and media industry today has everything going for it-be regulations
that allow foreign investment, the impetus from the economy, the digital lifestyle and
spending
habits of the consumer and the opportunities open thrown by the advancements in
technology.
The government on its part needs to play important part in sorting out policy related
impediment to growth. The entertainment and media industry has all that it takes to be star
performer of the Indian economy.