The digital dilemma casting a long shadow

News Release

The digital dilemma casting a long shadow over the Entertainment and Media industry

New Zealand’s entertainment and media market is now showing signs it’s beginning to embrace the new ways New Zealanders wish to consume entertainment and media content. That’s the sentiment revealed in the second edition of PwC New Zealand’s entertainment and media outlook publication.

PwC Partner Keren Blakey says, “organisations now have a better understanding of how to not only engage with, but also make money from today’s digital consumer, and to date, the industry held its ground over the past year and has an encouraging future.”

Revenues in the sector grew by 4.3 per cent in 2011, and we anticipate this growth to continue throughout the 2012-2016 forecast period by an average of five per cent.

Yet, Ms Blakey warns, “the challenge remains on how to keep pace with consumer trends, new technologies and the ever evolving ways of consuming content in this increasingly digital and mobile world?”

“Consumers are continually evolving in their preferences on how to consume content and as a result, sales of tablets and smartphones are rocketing and fuelling growing revenue opportunities in the digital delivery of advertising, entertainment and media content. Consumers can now be reached anywhere, anytime.”

Digital is now moving towards the heart of many media companies and presents the greatest opportunities for growth – what previously looked like a wide gap between old and new operating models is being bridged.

But, crucial to relevant industries attracting, retaining and entertaining consumers, is the current, existing and expected investment in infrastructure that will place New Zealand at the forefront of the digital economy.

“The shift in emphasis to digital and online media is expected to continue apace, driven by the development of faster and cheaper digital devices such as internet televisions, smartphones, tablets and notebooks, the increasing footprint of high speed connectivity and the advent of ultra-fast broadband. No segment is unaffected,” says Ms Blakey.

By staying on the digital course and having the courage to make bold changes to their business models, New Zealand’s entertainment and media players will be able to retain and grow their revenue streams.

The key trends from this year’s New Zealand entertainment and media outlook are:

•Consumer expectations are changing and becoming more demanding.

•Technology is disrupting the industry – changing consumer behaviours are changing where value lies.

•Mobility is driving change in the way users consume content.

•Major investment in New Zealand’s infrastructure is underpinning the transition from traditional to digital.

•It is becoming increasingly complex for businesses to engage and stay connected with their customers
across multiple channels.

•Value pools are shifting to customers, global players and holders of content – we are seeing an increasing need for change in business models as local players seek scale to compete effectively.

•Advertisers are following consumers as they spend more time online.

•Businesses are focused on getting better insights and more value from data intelligence.

Ms Blakey adds, “New Zealand is small by global standards and businesses now compete with large overseas and global players. Our local businesses need to find ways to effectively compete in an online and global world and there is evidence of increasing local partnerships and rationalisation within and across sectors. It is unclear what the future may hold as businesses test the waters for new and innovative ways to deliver services to consumers and extract value from the industry.”
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Notes to editors:
An embargoed copy of PwC New Zealand’s Entertainment and Media Outlook publication is attached for your information.
If you wish to use the publication on your website, once the embargo has lifted, please do not post the PDF directly on your website, instead please link to it at www.pwc.co.nz/entertainment-media-outlook

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