Everybody loves entertainment, but how does that translate to dollars and cents? The entertainment industry is composed of many subsections, including motion pictures, streaming content, audio recordings, live performances, publishing, radio, and more.
Between Hollywood and the surrounding creative industries, entertainment in the United States adds an estimated $500 billion to the nation’s GDP annually. Keep in mind that this is simply the public record, and far more money is likely in motion each year.
The global entertainment industry exceeds $2.6 trillion in annual revenue and is expected to rise exponentially in the next few years. The music industry, especially, is showing positive growth globally due to the ease of accessibility. Here’s a closer look into the entertainment industry’s various segments and the value they add to the economy.
The Motion Picture Industry
The motion picture industry has reported record box office receipts with each passing year. The global motion picture market was estimated to be worth $23 billion in 2005, and that figure has since tripled with even more runway to grow. While traditional theaters may be on the rocks at the moment, streaming and downloads reach new highs every quarter.
The United States and Canada take the lion’s share in this segment, with almost 50% of movie revenue coming from North America. The US has consistently performed better than other countries in the film industry. That is mostly attributed to the dominance of Hollywood in film production.
It has been argued that film giants push smaller independent entities out of the market, but the internet has been the great equalizer of the 21st century. Unknown to many, the motion picture industry now thrives on the rising popularity of video games, toys, and clothing sales. A closer look at the recent international box office revenues indicates that merchandise and licensing have nearly surpassed music videos and films in pure revenue.
The Music Industry
The music industry has consistently shown positive growth over the years. Thanks to streamlined at-home recording and user-centric content platforms online, there is more music being produced than ever before – and audiences are listening closely.
Globally, more than 90% of people listen to some form of music daily, while music videos remain popular among 60% of the population. Expectedly, most music consumers are of the younger generations, especially on streaming platforms and social media.
Considering live shows, merch, and crossover content, the music industry is probably larger than all the others combined. Additionally, the internet has made it easy for music to be shared among people worldwide, so further growth is inevitable. We look to industry icons like Mark Gillespie to pioneer new business opportunities for music artists and bring untapped talent into the spotlight.
Gambling is a minor component of the entertainment industry, gaining traction with new demographics through the internet. Interestingly, gambling is the oldest of all forms of entertainment but seeing a significant resurgence. For example, online sports betting has seen record numbers in recent years due to mobile accessibility and ease of use.
There is a form of gambling in almost every country now, though it remains well regulated. In the United States, Atlantic City and Las Vegas are major gambling spots, though casinos and sportsbooks are opening nationwide slowly but surely. Even video games now include some gambling elements, which raises ethical concerns for children and parents alike.
The entertainment industry is diverse and highly differentiated. Every product is unique and has distinct audiences. Additionally, entertainment products are impacted by seasons, timing, and fleeting trends. As the industry continues evolving, some elements are bound to be affected negatively or positively in light of world events.
Of course, global markets are not about to stop consuming entertainment products. It is estimated that revenues from the industry will be well into the trillions by 2021. Thinking about investing or participating in the entertainment industry? The space is competitive but indeed big enough to accommodate your ideas.