Hong Kong entertainment and media industry growth will slow to 2.3% in 2024, PwC forecasts
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Hong Kong leads the world in B2B market driven by trade shows
Hong Kong, 31 October 2024 – According to PwC’s “Global Entertainment & Media Outlook 2024 to 2028” Hong Kong summary, Hong Kong’s entertainment and media (E&M) revenue saw a slight increase of 4.5% year-on-year in 2023. The market is forecast to slow to 2.3% and reach US$12.87bn in 2024. Projections show E&M in Hong Kong will have a steady compound annual growth rate (CAGR) of 2.06% between 2023 and 2028, with revenue expected to reach US$14bn in 2028.
The business-to-business segment is on course for higher growth than its global and Asia Pacific counterparts between 2023 and 2028. However, the growth of printed media continues to lag, as digital advertising has become the dominant channel.
Cecilia Yau, PwC Chinese Mainland and Hong Kong Media Leader, said: “Hong Kong’s Entertainment and Media revenue has been shifting from consumer spending to advertising spending, as the rise of digital platforms and streaming services has led to a change in consumer behaviour. Many E&M companies are pivoting towards subscription-based models, which has led to a decline in revenue from the sales of physical media. As consumers are increasingly seeking personalised and immersive experiences, E&M companies should provide high quality content and services that are attractive to consumers and drive spending.”
OTT (over-the-top) video
Hong Kong’s OTT market has grown rapidly in the last two years, reaching US$371mn in 2023. The market is expected to continue to expand at a 5.7% CAGR to reach US$491mn in 2028. Subscription streaming services represents close to 84% of total OTT revenue in Hong Kong for 2023, and is on course to increase to over 85% in 2028.
The streaming market in Hong Kong is competitive, with a number of international streaming giants such as Netflix, Disney+, Amazon Prime Video, and Apple TV+ competing with local services such as ViuTV and MyTV Super. Amid developments, OTT service providers are launching apps that feature coverage of popular live sports, such as the English Premier League and the UEFA Champions League.
Business-to-business
Hong Kong’s business-to-business market, including trade shows, trade magazines and business information, was the fastest growing in the world in 2023, making a year-on-year gain of 21.4%, equating to US$814mn. It is expected to grow at a high CAGR of 3.55% from 2023 to 2028, driven primarily by trade shows, outperforming the global average of 1.86%.
Trade shows accounted for over half of the business-to-business market in Hong Kong. Having a delayed recovery, the trade shows market in Hong Kong reached US$447mn with 45.9% growth in 2023, and is projected to grow at 5.5% CAGR, to attain a value of US$585mn in 2028. The two largest global organisers have 17 events scheduled for 2024 in Hong Kong, including Aero-Engines Asia-Pacific, Retail Asia Conference & Expo and property show MIPIM Asia Summit.
Internet advertising
Internet advertising dominates the advertising market in Hong Kong. Faced with challenges from the local consumer market, the Internet advertising in Hong Kong will grow moderately at 3.7% CAGR, from US$1.6 bn in 2023 to US$1.9 bn in 2028. Retail paid search Internet advertising will be the key driver of growth in Internet advertising, increasing at a CAGR of 10.06% from 2023 to 2028. This growth is buoyed by the acceleration of e-commerce and a rise in online shopping. Concurrently, there is greater willingness among consumers to engage with content online.
Live music
Hong Kong’s live music market has rebounded, with revenues expected to reach US$201mn in 2024, well up on the US$121mn reported in 2019. It is set to continue to grow in the years ahead at 2.3% CAGR, hitting US$216mn in 2028. Coldplay has announced to hold concerts in the newly completed Kai Tak Sports Park in 2025, which is expected to further boost the market.
Traditional media
Advertising revenue contributed by traditional media continues to shrink. Printed publications will see a drop in revenue of 1.54% CAGR to US$101mn by 2028, while traditional TV revenue will decline at a 0.4% CAGR to US$563mn by 2028.
Conversely, broadcast TV advertising revenue in Hong Kong is forecasted to grow at a 0.84% CAGR, reaching US$359mn by 2028. This trend reflects the ongoing reliance on TV to reach broad audiences, alongside increasing advertising investments from local brands and businesses.
Generative AI
Having exploded onto the scene in the past couple of years, generative AI (GenAI) brings major implications— opportunities and challenges—for companies across E&M industries. PwC’s most recent CEO Survey shows that over two-thirds of Asia Pacific CEOs foresee substantial impacts of GenAI on their companies, workforce, and markets within the next three years.
So far, much of the discussion surrounding AI in E&M has focused on reducing and controlling costs—rather than advancing new revenue streams. GenAI-driven text generation tools can translate concepts into stories and generate credible human dialogue, turn text into visuals and storyboards, and create animated 3D models from 2D videos or static images. GenAI can also add value in post-production by enabling quicker and easier editing.
Beretta Ching, E&M Industry Partner, PwC Hong Kong observed: “As we look ahead, industry participants will have to focus on how this powerful technology can lead to greater value creation. GenAI offers users a powerful flywheel for experimenting, iterating, and scaling new solutions and processes. In advertising, GenAI can be used to quickly develop creative approaches for different contexts—and then to iterate and refine rapidly in response to consumer attention and uptake. If GenAI can be harnessed to offer fresh experiences and create new revenue streams, the growth potential will be even greater.”
Notes
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