BY Matt Atkins
The media and entertainment (M&E) industry is ready to take the spotlight, according to a new EY report, as executives shake off their fears for the economy and shift from cost cutting to growth.
EY surveyed 50 large global M&E companies for the 'It's Showtime! Digital drives the agenda, data delivers the insights' report, which showed that only 26 percent of senior executives surveyed were concerned that economic uncertainty would impact growth, compared to 62 percent in 2012. The survey spanned industry sectors including filmed entertainment; broadcast and cable networks; music and radio; advertising; internet and interactive media; and publishing and information services.
The report showed that firms are well positioned to grow their companies through capitalising on digital opportunities and investments in technology, digital talent and infrastructure, as well as acquisitions and other deals. The average deal value during the first half of 2014 was US$939m, compared with US$220m in 2013 and US$157m in 2012, with cable operators driving the rise.
"The CFOs told us in no uncertain terms that the economy is no longer an obstacle and now is the time for media and entertainment companies to invest in growth and focus on building their businesses," said John Nendick, Global Media & Entertainment Leader at EY. "The industry is now poised to deliver on the promises it has been making the past several years but has been unable to achieve because of the economy. The CFOs recognise the recession is over and it's showtime."
Though the outlook has improved, the M&E industry still faces challenges. According to EY, the greatest tests for M&E firms going forward are technology and platform disintermediation, an inability to persuade consumers to pay a fair price for content and regulatory uncertainty.