The sector is projected to expand at a compound annual growth rate (CAGR) of 2.9% and will be worth €7.6bn in 2028, up from €6.6bn in 2023.
Growth will be driven by increasing mobile internet services, internet advertising and video-on-demand subscriptions.
However, the media and entertainment industry globally is expected to grow 3.9% CAGR over 2024-2028, outpacing Ireland primarily due to faster growth in the video gaming segment, with overall revenues rising from €2.6tn to €3.1tn in that time.
PwC's global entertainment and media outlook track spending by consumers and advertisers in 53 territories across connectivity services, internet advertising, music, radio and podcasts, cinema, newspapers, consumer magazines and books, out-of-home (OOH) advertising, Video on Demand (VOD), traditional TV, and video games.
The professional services group said the Irish entertainment and media sector had demonstrated resilience and growth last year despite technological disruption from generative AI and increased competition.
Amy Ball, partner in PwC Ireland's entertainment and media practice, highlighted the government's decision to raise the cap on eligible spending for the section 481 film tax credit from €70m to €125m as evidence of Ireland's support for the industry.
“As the global entertainment & media industry continues to grow, market players face both risks and opportunities," said Ball.
"Shifts in consumer preferences, and uncertainty around the continued impact of digital transformation and new and emerging technology such as generative AI, are inspiring a wave of business model reinvention.
"Leveraging the power of AI and Gen AI will be critical.
"If market players are to gain their share of the growing revenue pools that the report identifies, they will have to reimagine how their company creates, delivers, and captures value.
"As consumers increasingly consume content online, companies will also need to diversify their product offerings and continue to connect with consumers on the platforms where they spend more of their time.”
Mobile internet service revenues are projected to grow to €1.6bn by 2028 with CAGR of 3.2% as 5G becomes the primary mobile access technology, accounting for 82% of the subscription base, and fixed broadband service revenue will increase to €1.4bn (0.6% CAGR).
Internet advertising revenues will increase at a CAGR of 9.5% to €1.8bn, a similar pace of growth to the global project, driven by video advertising (€185m at 11.5% CAGR).
Paid search advertising will see compound annual growth of 10.2% and other display or traditional non-video ads will increase at a CAGR of 7.8%.
PwC said paid search advertising is by far the biggest category in Internet Advertising revenue terms, making up just over 59.1% of total revenue, followed by other displays (28.2%), video (9.2%) and classified (3.4%).
Ireland's video-on-demand market is likely to €299m by 2028 at a CAGR of 8.9%, up from €196m in 2023, and subscription video-on-demand (ie streaming services) will make up 88% over the VOD market.
However, service providers will face increased competition and will struggle to get consumers to pay more for digital goods and services.
Irish subscriptions to VOD services are expected to rise to 2.6m in 2028 from 1.8m in 2023 – representing a 7.7% CAGR compared with 5% globally.
The Irish average revenue per VOD subscription is expected to show slow growth of 1.7% CAGR over the forecast period, rising from €93.23 in 2023 to €101.64 in 2028.
Globally, revenue per subscription growth is expected to plateau with average revenue per VOD subscription expected to rise slowly from €59.15 in 2023 to €61.57 in 2028 as the market consolidates through bundled subscriptions.
Additionally, the video game (+3.2% CAGR to €545m) and cinema (+5.6% to €145m) sectors will also grow significantly in the coming years.
Within the video game industry, physical console game revenues are likely to shrink, decreasing at a CAGR of 11.3% while social and casual gaming are expected to grow from €198m to €283m by 2028 due to in-app games advertising, which is expected to double from €59m to €110m.
Growth will be driven by increasing mobile internet services, internet advertising and video-on-demand subscriptions.
Meanwhile, cinema admissions are projected to grow from 12m in 2023 to 14.3m in 2024 with a CAGR of 3.4%.
Revenue derived from music and radio totalled €465m last year and will rise to €530m by 2028 at a CAGR of 2.7% in line with the global average.
Music accounted for €354m in 2023, with live music contributing €243m or 69% of the total. Following growth of a quarter (+23.5%) last year, live music revenues are earmarked to increase to €279m by 2028 at a CAGR of 2.8%.
Conor Forde, director of PwC Ireland's entertainment and media practice, speculated about how the advent of generative AI will translate into higher revenues, with the technologies increasingly being used in content creation and advertising.
“The global entertainment & media industry has always thrived on technological disruption and Ireland is no different," Forde said.
"To capitalise on the many growth opportunities, the industry must leverage the power of new and emerging technologies such as Generative AI, re-shape business and creative models and leverage the technology for advertising.
Annual cinema admissions are likely to increase by 2m over the next few years.
"So far, many of the applications of Gen AI in the E&M industry have focused on speed and efficiency.
"As we look ahead, the industry will have to focus on how GenAI can lead to greater value creation in a safe and secure way and in compliance with the new EU AI Act through experimenting, iterating, and scaling new solutions and processes.”
*This article was originally published on BusinessPlus.ie
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