Author: Abhayanand Singh, CEO – Golden Ratio Films & Chairperson – Singapore South Asian International Film Festival.
For the most part of 2020, COVID-19 has dominated the headlines. The virus has brought businesses and the world economy to a grinding halt. Uncertain about employment, many have become wary of unnecessary expenditure. Despite the slowdown, however, there is a steady increase in consumers’ appetite for one thing: content.
Confined to their homes, people are turning to their electronic devices for entertainment. The irony is that while there is an increase in demand, the entertainment industry itself has come to a standstill.
To stem the rising number of COVID-19 cases, India enforced a lockdown from March 25 that extended till June. Since then, the Rs 183 billion Indian film industry has suffered huge losses. The immediate impact was seen when the release of Rohit Shetty’s film Sooryanvanshi slated to release on March 24 was postponed indefinitely. The announcement was soon echoed by other productions.
Films already in theatres, such as Baaghi 3 and Angrezi Medium, had an enforced short stay. Complying with the strict measures put in place, film bodies, including the Federation of Western Indian Cine Employees and the Indian Film and Television Directors’ Association, decided to halt the shooting of movies, TV shows and web series.
COVID-19 didn’t spare Hollywood either. The US entertainment industry union IATSE reported that 1,20,000 workers have so far been laid off as a result of the shutdown.
Broadcast and Print Media
The media and entertainment sector was estimated to be Rs 1.631 billion in FY19 and grew at a compounded annual growth rate of 11.5% over five years (FY15-19). However, an analysis by CRISIL based on 78 media and entertainment companies, said that the COVID-19 pandemic will cull revenue by Rs 25,000 crore to Rs 1.3 lakh crore this fiscal.
Due to a decrease in demand for various goods and services, the advertising budgets of companies might retract, thereby reducing ad revenue for media companies. The CRISIL report estimated an 18% cut in ad revenue. Broadcast media can take heart from the fact that consumer consumption has increased as people tune in to the news to follow the latest updates on the pandemic.
However, print media can take no such solace. The lockdown put a stop to the circulation of newspapers and affected their bottom lines. From salary cuts and layoffs to sending employees on indefinite leaves without pay, publications adopted various strategies to stay afloat. On March 30, a leading magazine announced a temporary suspension of publication.
The Events and Entertainment Management Association conducted a member survey with 170 companies and the results revealed the uncomfortable state of the industry: 52.9% of the companies said 90% of their business between March and July 2020 had been cancelled and 107 companies suffered a revenue loss of up to Rs 1 crore each.
The association said that due to the cancellation of productions and events, close to 10 million staff were affected. As a corollary, personnel employed in allied sectors such as food and beverage, hospitality and tourism have been affected. Losses for the first two months had crossed Rs 3,000 crore. Events including IIFA2020, India Gaming Expo, FDCI India Fashion Week, GoaFest, PU Tech, ITB-India, India Fintech Festival, Ultra Festival and META Theatre Awards got cancelled. Big-ticket events such as Trevor Noah’s Loud & Clear and Khalid’s Free Spirit Tour were postponed. Major global events such as the Tokyo Olympics – 2020, Google IO – 2020 and The World Mobile Congress were either cancelled or postponed. Exhibitions, product launches and other corporate events have taken a backseat.
Perhaps the biggest loss for the Indian economy is the uncertainty surrounding the Indian Premier League. Reportedly, the 2015 IPL had contributed Rs 1,150 crore to India’s GDP. According to a franchise official, cancellation of tournaments will cost the cricket board, broadcasters and franchises at least Rs 3,000 crore. While playing in a closed stadium might allow the board and broadcasters to earn a substantial amount of revenue, the rule of social distancing prohibits the gathering of more than 10 people.
Digital – The Silver Lining
As expected, online consumption has increased manifold. According to Carat India, Indians are spending nearly three hours a day on their smartphones, and more than 30% of this time is spent on consuming entertainment. The peak hours of consumption have also increased and are around 8 am-11.30 am and 6 pm-midnight.
All OTT platforms have seen a rise in viewership with people watching older episodes of programmes. New releases on OTTs have also garnered interest from different sections of society.
Visual is not the only medium gaining ground. Audio platforms and music streaming apps have gained too. With an 18%-22% increase in listenership and an almost 30% jump in downloads, podcasting platforms have gained some traction. The lockdown has also necessitated creativity and innovation giving rise to virtual concerts such as the One World: Together At Home celebrity concert for COVID-19 relief that drew 21 million viewers.
The pandemic has reinforced what was common wisdom – digital is the way forward. Media companies, as well as large corporations in other sectors, have realized the value of digital content with brands posting content on social media to drive consumer engagement. The future of the entertainment industry might be different than previously imagined but one thing is certain – the content is king!
About the Author
Abhayanand Singh, CEO, Golden Ratio Films & Chairperson, Singapore South Asian International Film Festival (Sg.SAIFF) holds a rich professional experience, and immense knowledge in numerous industries namely banking, finance, pharmaceuticals, software, and media. An MBA graduate well acquainted with the corporate environment and having an expertise in managing investments for HNIs
(High Net Worth Individuals), he has been an independent professional overseeing a family business with a group of investors. His enormous love and passion for cinema brought him into the world of media and content creation. Previously, he has dealt in equities, bonds, options, currencies and other alternative asset classes.
Abhayanand is also the distributor for the upcoming Hollywood French-Indian co-production “The Extraordinary Journey of the Fakir” (Dhanush). He has also co-produced the feature film ‘’Albert Pinto Ko Gussa Kyun Aata Hai” (Manav Kaul) and produced ‘’Bhonsle” (Manoj Bajpayee), which is currently being screened at various International Film Festivals. He belongs to a royal family of ‘Banaili’ hailing from a small town of Purnia, situated in Bihar.