UK media & entertainment sector to be worth £72 billion by 2021
UK data from the annual Entertainment & Media Outlook report forecasts the UK's Virtual Reality (VR) industry to grow to a value of £801 million by 2021, at a rate of 76% year on year, making it the fastest growing and largest VR industry across Europe, the Middle East & Africa.
PwC's 18th annual edition of the Global entertainment and media outlook 2017-2021 has projected the UK entertainment and media sector will reach a worth of £72 billion. Researchers also suggested this sustained growth will be driven by a boom in the consumption of Virtual Reality (VR), with the number of headsets in use in Britain set to surpass 16 million by the year 2021.
The UK’s video games industry is set to remain Europe’s largest market and the fifth largest globally behind the US, China, Japan and South Korea. With revenue forecast for a 6% Compound Annual Growth Rate (CAGR) over the five year period, by 2021 will the UK gaming market will be worth £5.2 billion. The overall spending of UK consumers on video games is also set to overtake all spending on books, which will reach £5bn by 2021.
With new media finally surpassing traditional means of entertainment in this manner, while increasingly utilising new VR technology such as the Oculus Rift – a headset developed by Facebook – to innovate and improve the standards of realism offered by current gaming systems, Virtual Reality looks set to boom consistently over the coming years.
Dawning reality
While the global VR industry was expected to break the $1 billion barrier by 2016, by fellow Big Four consultants Deloitte, the UK’s own virtual reality market is projected to grow at a faster rate than any other Entertainment & Media (E&M) industry from 2016-2021, according to PwC researchers. Their most recent analysis points toward a CAGR of 76% year on year, with the British market reaching a value of £801 million come 2021, making it the fastest growing and largest VR industry in Europe, the Middle East and Africa.
Benefitting from other trends within entertainment technology, the number of VR headsets in use in the UK will pass 16 million by 2021. Just 3 million of the new While improving roaming internet access means mobile internet revenue is projected to overtake that of fixed broadband by 2019, PwC also expect 12 million of the new VR headsets will be portable mobile VR devices, and a further 1 million will be a new category of self-contained device with superior capabilities to smartphone-based devices known as “portable dedicated headsets”.
In 2016, the growth of the global E&M was forecast to have slowed, by PwC’s own in-house strategic research arm, Strategy&, however the UK’s own outlook seems set to exceed the average trend.
The outlook for the UK’s E&M sector as a whole was for a compounded annual growth rate (CAGR) of 3% from 2017-2021 meanwhile, with PwC estimating the market to add £10bn to its value to the economy over five years. The industry value in the UK currently stands at £62 billion, including an annual £1 billion revenue from national music venues Overall, revenue will grow from £62bn in 2016 to £72bn by 2021 to become the second largest market in the EMEA behind Germany.
Commenting on the findings from the annual Outlook, Phil Stokes, UK head of Entertainment & Media at PwC, said, “The UK’s entertainment and media sectors will play an important role in economic growth over the next five years. Technology and digital service continues to dictate growth with companies tapping into where and how consumers are spending their time online. With consumers having more control and greater choice, companies will need to find new ways to stand out and engage with customers.”
