Entertainment spending tipped to soar

Global entertainment spending will reach US$1.8 trillion ($2.9 trillion) in 2010, fuelled by the spread of broadband and wireless technology, says an international report from accountants PricewaterhouseCoopers.

Consumer spending on entertainment through online and wireless channels would more than triple to US$67 billion by 2010, from US$19 billion in 2005, the report said.

The firm's analysts said entertainment spending in the Asia Pacific region would grow fastest, with double-digit increases on internet, television distribution, video games, and casino and other regulated gaming.

By 2009, China was expected to surpass Japan as the largest market for media and entertainment in Asia.

But the US will remain the largest, though slowest-growing, global media consumer. US media spending will increase by 5.6 per cent a year, on average, to reach US$726 billion in 2010. That growth would be led by video games and the internet.

The spread of digital distribution combined with stepped-up Government enforcement and improving economic conditions in developing markets would mute the effects of piracy on the overall industry.

Current growth rates in advertising would stay constant through 2008, but would slow in 2009 and 2010.

Internet advertising will continue to grow the fastest of all advertising modes, racking up US$521 billion in sales from US$385 billion in 2005 and capturing nearly 10 per cent of global advertising dollars.

Michael Kelley, a partner in PricewaterhouseCoopers' entertainment and media practice, said the firm expected a rebound in box office and home video spending driven by digital upgrades in both industries, as well as the modernisation of theatres in developing nations.

The US movie theatre industry this year began converting its 37,000 screens from 35mm projectors and prints to digital equipment.

Kelley said the home entertainment market will benefit from the introduction this year of high-definition DVD formats, the rising popularity of the DVD format in Latin America, and the growth of broadband penetration that allows consumers to buy movies online.

- REUTERS