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Indian Media Industry Shifts to Digital, Boosting Growth

Digital Transformation

Media Sector, India, Dominance, Online Platforms

Business Honor
14 Febuary, 2025

The Indian media industry is shifting towards digital platforms, with expected growth of 8% by FY2027.

The Indian media industry is going through a revolutionary period dominated by increasing predominance of the internet space. A CRISIL report predicts that revenue expansion on a year-on-year basis will rise by almost 8 per cent to FY2027 at approximately Rs 60,000 crore. Consumer preferences are shifting largely to digital because of which media outlets are conforming to the digitalization wave.

In the past five years, FY2019 to FY2024, the sector grew at a decelerated rate of 5 per cent annually. Still, with digital media like over-the-top (OTT) streaming, social media, and mobile apps gaining more popularity, media firms are placing greater emphasis on these sources in an attempt to take advantage of the rapidly increasing digital consumer base. The share of the digital segment in revenue will increase significantly, from about 12 per cent in FY2024 to over 18 per cent in FY2027, due to growing digital consumption of news and entertainment material by consumers.

While most of the push for digital, media companies initially struggled with profitability here due to the initial high investment in establishing content, manpower, and advertising, especially in developed markets where plenty of free content choices are available. But targeted advertising and customer segmentation are bound to improve profitability. With more knowledge of the target audience segment, media companies are now better handling promotional spending and improving margin performance.

Additionally, while digital transformation promises tremendous growth, profitability continues to be a function of factors like the cost of newsprint as a raw material. Sharp rises in costs or global supply chain interruptions, as witnessed during FY2023, can impact margins once again. Overall, the focus on digital transformation will redefine the company, leading to sustainable and more profitable growth in the next few years.