India's ad industry revenues to touch INR 1.58 lakh crores by 2028: PwC report

The media and entertainment sector in India is expected to touch INR 3.65 lakh crores by 2028, growing at 8.3% CAGR, according to the latest report ‘Global Entertainment & Media Outlook 2024–28: India Perspective’ released by PwC. Incidentally, the country's growth rate is more than 80% higher than the global growth rate of 4.6%. The report mentions that the growth in the Indian market is led by digital advertising, over-the-top (OTT) platforms, and online gaming.

Propelled by a sustained growth in GDP and consumption, India’s advertising market is estimated to reach INR 1.58 lakh crores in 2028 in value terms, growing at 9.4% CAGR from last year's level of INR 1.01 lakh crores. According to the PwC report, India's advertising market has been demonstrating a 40% higher growth than the global growth rate average.

A high growth trajectory is witnessed even in the case of online advertising, which is likely to touch INR 85,000 crores in 2028, growing at a 15.6% CAGR from the year 2023 level of INR 41,000 crores. India’s growth in this area is 60% higher than the global average, making the country the fastest-growing market across the top 15 economies of the world. The growth in online advertising is largely driven by advancements in digital public infrastructure (DPI) and increasing consumer engagement by brands through targeted, data-driven advertising formats.

According to the study OTT platforms category is expected to see a doubling of its revenues from INR 17,496 crores in 2023 to INR 35,061 crores in 2028, indicating a CAGR of 14.9%. Of this, subscription-based video-on-demand services (SVOD) will control 65% of revenues, while ad-supported (AVOD) services will see a high 26% CAGR. By 2028, the number of video OTT subscriptions is projected to grow from 10.1 crores to 16.9 crores, indicating a rising appetite shown by Indian consumers for regional content and affordable plans.

Source: PwC

The report notes that with 45 crore gamers in India, the online gaming and esports category will expand at a 19.2% CAGR, touching INR 39,583 crores in 2028. Within these, social and casual gaming is expected to dominate. The in-app advertising revenue is estimated to increase at 34.4% CAGR, reaching INR 17,300 crores by 2028. The category, the report mentions, presents a fast evolving opportunity for advertisers and content creators.

Although rising at a moderate pace, even the traditional media will be a sizeable contributor to total revenues of the sector, according to PwC. With revenues rising at 4.2% CAGR, Indi’s TV advertising will emerge as the fourth-largest globally by 2026. Defying the global trend, the print advertising market in India will be the third-largest in the world by 2028, growing at a 3% CAGR.

PwC points out a similar growth in Cinema and out-of-home (OOH) advertising. Box office revenue is expected to rise by 14.1% CAGR, while OOH advertising, supported by infrastructure improvements, is projected to touch INR 5,961 crores by 2028, growing at 7.6% CAGR. The music market too is witnessing a streaming boom, with revenues estimated to increase from INR 6,686 crores in 2023 to INR 10,899 crores in 2028, growing at 10.3% CAGR. Podcast ad revenues too are on the rise, predicted to grow from INR 285 crores in 2023 to INR 437 crores in 2028, suggesting the increased consumer interest in on-demand audio content.

A primary factor driving India’s media and entertainment industry, according to PwC report, is its demographic advantage. India boasts of world’s largest digital audiences, housing over 91 crore millennials and Gen-Z consumers, 78 crore internet users, and 80 crore broadband subscriptions. The government programmes like Digital India and the upcoming World Audio Visual & Entertainment Summit (WAVES) are providing a further boost to the industry’s infrastructure development and global collaboration.

Manpreet Singh Ahuja, chief digital officer and TMT Leader at PwC India, said, “India’s entertainment and media landscape is undergoing a transformation driven by digital innovation, consumer behaviour, and supportive government policies. Companies that innovate in key growth areas will shape the future of this dynamic sector.”

With adoption in applications for hyper-personalised content, ad optimisation, and interactive storytelling, generative AI (GenAI) is proving to be a game-changer for India’s media and entertainment sector, according to PwC. While Indian companies are using generative AI tools to improve audience engagement and monetisation, over 70% of global corporations are likely to integrate gen AI into their operations by 2025, finds PwC study.