Entertainment sector may double by 2008

The size of the Indian entertainment industry will more than double to Rs 42,300 crore in 2008 from Rs 19,200 crore in 2003, says a report brought out by Ficci and Ernst & Young. The report was tabled at the global convention on entertainment, Ficci-Frames 2004 today.

The report provides an insight into the industry's major segments comprising films, television, music, radio and live entertainment.

The Ernst & Young compiled the report after talking to over 50 industry leaders and after conducting an online survey.

The industry outperformed the economy last year by growing 15 per cent to Rs 19,200 crore. "An increase in television viewership and improved realisations from television subscriptions and film exhibition were the reason for this growth," says the report.

Farokh Balsara, Ernst & Young India's leader for media and entertainment industry practice, said, "Increasing consumer spending, growing television penetration, expanding international markets for Indian entertainment, the Indian government's progressive policy measures and the GDP expected to be at healthy 8 per cent, the future looks good for the industry."

The report has recommended the rationalisation of entertainment tax, extension of concessions offered to multiplexes, a common ticketing platform for film tickets, and relook at the current licence fee regime for FM radio players to make the industry more competitive.

The report also requested the government to empower a central body that would issue licences to cable operators, based on certain mandatory information such as entertainment tax duty registration, service tax and income tax registration and details of subscriber base.

These licences could be free of cost to existing operators in the area, and auctioned to new entrants. These details would be open to scrutiny by the independent body and the report sees it as a significant step to inducing organsiation and transparency. The report points out that piracy is cannibalising 60 per cent of the film industry's revenues.

Unless, strong penal action is taken to stem this revenue loss, film makers will unable to unlock the full value of their creative products.

Further, institutional funding forms only 5 per cent of the organised funding and an increase will help strengthen the business model for film making and raise the standard for accepted financial and accounting practices across the country.