OTT video on the rise in Africa as digital divide narrows | OTT | News | Rapid TV News
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The African entertainment industry is breaking down barriers between the traditional and digital sectors as Internet access increases and with it video and mobile consumption, according to PricewaterhouseCoopers (PwC).

South Africa's entertainment and media industry is forecast to grow from ZAR112.7 billion in 2014 to ZAR176.3 billion in 2019, at a compound annual growth rate (CAGR) of 9.4%. Digital spend is expected to fuel this growth, says PwC, with the growing Internet access market becoming the largest revenue contributor.

"This year's Outlook shows consumer demand for entertainment and media experiences will continue to grow, while migrating towards video and mobile. Increasingly, though, it's clear that consumers see no significant divide between digital and traditional media – what they want is more flexibility, freedom and convenience in when, where and how they interact with their preferred content," says Vicki Myburgh, entertainment and media leader, PwC Southern Africa.

Internet access is acting as the driver of revenues of the increasingly key sectors of digital film and gaming in South Africa, making over-the-top (OTT) video streaming and social gaming more "viable to more consumers," she added.

TV remains a major contributor to consumer spending in South Africa, with combined revenues from pay-TV subscriptions, advertising and licence fees set to reach ZAR40.9 billion in 2019, PwC predicts. This follows the global rise in overall consumer spending in this period on video-based content and services.

TV advertising will remain responsible for the lion's share of South Africa's total entertainment and media advertising revenue, which is expected to rise by 5.6% from ZAR39.7 billion in 2014 to ZAR52.1 billion in 2019.

Meanwhile in Nigeria, the entertainment and media market is expected to double in size between 2014 and 2019. The market grew by 19.3% in 2014 to reach US$4 billion, but revenues should reach $8.1 billion by the end of the decade. The two main revenue drivers will be the Internet and TV advertising and subscriptions, however the continued problem of content piracy will remain an issue, says PwC.

The entertainment and media market in Kenya is also set to continue its upward trajectory. The country's industry was valued at US$1.8 billion in 2014, up 13.3% from $1.6 billion in 2013. This figure is expected to top the $3 billion mark in 2019 to reach $3.3 billion.

Once again, the Internet is forecast to be the key reason for industry growth, followed by television and radio. TV advertising will overtake radio in 2016, and Internet advertising will see the fastest growth rate at a CAGR of 16.8%, according to PwC's report 'Entertainment and media outlook: 2015 – 2019, South Africa, Nigeria, Kenya'.

"Today's media companies need to do three things to succeed: innovate around the product and user experience; develop seamless consumer relationships across distribution channels; and put mobile (and increasingly video) at the centre of the consumer's experience," said Myburgh.