Accra, September 21, 2017//-Ghana’s entertainment and media ( E&M) industry is beginning to gear up. In 2012, total revenue was just at US$214 million, but four consecutive years of year-on-year growth above 25% have led it to revenues of US$685 million in 2016.
This is forecast to more than double over the next five years, with revenues of U$1 billion being surpassed in 2019 and a total of US$1.5 billion forecast for 2021, thanks to a 16.5% compound annual growth rate (CAGR).
This is according to Pwc’s ‘Entertainment and media outlook: 2017 – 2021: An African perspective’ released today.
Ghana’s E&M industry is beginning to gear up. In 2012, total revenue was at just US$214 million, but four consecutive years of year-on-year growth above 25% have led it to estimated revenue of US$685 million in 2016. This is forecast to more than double over the next five years, with US$1 billion being surpassed in 2019 and a total of US$1.5 billion forecast for 2021, thanks to a 16.5% CAGR.
This points to a very healthy environment, but a note of caution must first be given. Much of this market remains dominated by spend on Internet access—fixed broadband and, predominantly, mobile.
In 2012, 23% of overall E&M revenue was derived from spending on access, but by 2016 this had risen to 55%. This remains a market where entertainment and media spend is largely derived from access to that entertainment and media, with consumers not yet prepared, or able, to spend discretionary income on further digital entertainment options.
Matters are slowly changing, however. Internet access will continue to take an enlarged share of overall revenue (68%) in 2021, but this will be an increase of 1.7% on 2020. Last year, Internet access’s share of total E&M revenue rose by more than 6.2 percentage points.
While access revenue will dominate, it will increasingly act as an enabler for further spend. With Internet access revenue removed, combined consumer and advertising E&M revenue will still rise by a healthy US$169 million between 2016 and 2021.
Increased Internet access is steadily acting as an enabler for E&M revenue. The adoption of OTT and triple-play services in Ghana is supported by increased mobile and fixed broadband connectivity, as well as demand for VOD services by consumers. Netflix and ShowMax have already launched services in the country.
Ericsson has also unveiled NuVu, an SVOD service in partnership with broadband operators. SVOD revenue in Ghana is forecast to reach US$8.5 million in 2021, rising at a 22.4% CAGR. Music streaming is having less success, with revenue at trivial levels, but increasing mobile Internet connections mean the sale of ringtones and ringbacks is in a healthy state, at US$3.7 million in 2016.
Television, too, is a major contributor to E&M revenue, with advertising revenue unusually exceeding payTV subscription revenue. Ghana’s total TV households are comfortably above three million, while pay-TV households stood at 585 000 in 2016.
This is forecast to accelerate very strongly thanks to pay DTT, which became the leading pay-TV platform in 2015, though its low-ARPU model means it will not overtake satellite in revenue terms until 2019. Pay-TV households of 1.3 million in 2021 will provide a very firm platform for increases in both consumer and advertising revenue.
Advertising to add nearly US$100 million to 2021
TV advertising is the largest contributor to overall Ghanaian advertising revenue, accounting for 35% of the total in 2016, and forecast to be the first advertising segment to exceed US$100 million in 2021. As in many markets, sporting content is a major draw for advertisers (as well as subscribers), with MultiChoice’s SuperSport holding important football rights such as for the UEFA Champions League.
For OOH, years of effort to regulate a previously informal market are bearing fruit with strong revenue, both in growth and absolute terms. The Advertising Association of Ghana has seen success in reducing illegal signage, which has facilitated the growth of the legal industry, while the burgeoning growth of DOOH, fuelled by operators Alliance Media and Global Outdoor Systems, means a 24.4% DOOH revenue CAGR is expected to 2021.
Radio, too, will weigh in with notable growth, thanks to a healthy network of more than 350 radio stations. Meanwhile, Internet advertising will see the strongest growth from small beginnings as advertisers nationwide increasingly follow their targets online.
African Eye Report
