Forecast: Italy E&M industry worth €58bn+ in 2028
October 30, 2024
From Branislav Pekic in Rome
Despite global economic challenges, Italy’s Entertainment & Media (E&M) industry thrived in 2023, expanding by 3.7 per cent to €50.1 billion, boosted by a 9.3 per cent growth of advertising revenues to €12 billion.
This sector is poised for further growth, with a projected CAGR of 3.1 per cent leading to a €58.4 billion valuation by 2028, according to forecasts from PwC.
Growth is being driven by the digital segment, accounting for 84 per cent of total revenues in 2023 and expected to expand at a CAGR of 4.6 per cent to 2028. This is fueled by the rise of online advertising, which reached €6.5 billion in 2023, and the continued growth of AVoD services.
Total advertising revenues are also projected to rise at a CAGR of 4.7 per cent, reaching €15.1 billion in 2028.
OTT revenues have quadrupled since 2019, surpassing traditional pay-TV for the first time in 2023. This surge is fueled by a shift in consumer behaviour, with viewers opting for cheaper, more flexible OTT subscriptions.
Italy’s non-digital E&M sector is projected to contract until 2028, primarily driven by a sharp decrease in video revenues, particularly from the public licence fee. The government’s decision to reduce the annual licence fee to €70 from €90 will significantly impact public broadcaster Rai’s revenue.
As the cost of content continues to rise and subscriber growth stagnates, streaming services must innovate to maintain profitability in the coming decade, suggests PwC. Major players like Netflix, Prime Video, and Disney+ have launched ad-supported tiers to broaden their audience and increase revenue, a trend expected to continue in the coming years.
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