Russian Entertainment & Media Industry worth $27.9 bn by 2011

28 June 2007 — Russia’s entertainment & media industry (E&M) had the highest growth rate in Europe in 2006, according to PricewaterhouseCoopers Global Entertainment and Media Outlook: 2007–2011. The industry grew by 7.1%, with the cumulative annual growth rate in 2007–2011 forecast at 6.9%. PricewaterhouseCoopers valued the Russian E&M market in 2006 at $19.9 bn, to reach $21.1 bn this year.
Internet advertising and access had the highest spending in Russia (and globally), coming to $3.7 bn. This will continue to be the fastest growing segment for the next five years, expanding at 20% a year on average. The television distribution market was second in terms of growth, at 18.3% a year. Book publishing will have the slowest growth rates (3.1%), in line with international trends. The casino and recording segments will slow on average by 22.7% and 7.7% respectively.

E&M segments in Russia

Filmed Entertainment
Spending in filmed entertainment (box office and rentals in various formats) grew in 2006 by almost 13% to $703m, of which $412m were cinema box office takings, an 18% rise on 2005. The box office market is expected to more than double in size over the next five years to $941m. The segment as a whole will be worth $1.4 bn.

Television, radio and out-of-home advertising
The Russian television advertising market in 2006 was worth almost $3 bn—28% higher than in 2005. The forecast for 2007 is growth to $3.7 bn. Radio advertising grew at an even faster rate—total sales in 2006 were $350m, a 40% hike on the previous year. Analysts expect growth to slow, but to remain at the relatively high level of around 3.6% a year. Out-of-home advertising saw much lower growth rates. In 2006 this segment was worth $1.1 bn and growth in 2007 is forecast at just 9%, much lower than in previous years. This fall-off is expected to continue, the segment growing by just 2.7% to 2011.

Print media
Newspaper purchases in Russia amounted to $1.5 bn, with advertising spending increasing by 19% to reach $345m in 2006. The print advertising market is expected to grow at 6.4% a year on average. Due to changes in advertising legislation, the Russian magazine advertising market will see healthy growth. In 2006 advertisers paid around $700m for space in magazines, and the market is expected to reach $800m in 2007. Magazine purchases in 2006 came to $286m, while the compound annual growth rate over the next five years in this segment is forecast at just 4.4%.

Book publishing
Russia’s book publishing sector had a volume of $1.88 bn in 2006. The cumulative annual growth rate (CAGR) over the next few years will be small, at just 3.1%. Fiction, entertainment and children's books make up half the market, educational books 35% and business literature 15%. These market shares will continue in the future.

Internet advertising and access
PricewaterhouseCoopers estimates show that Russia had 11.5 million dial-up Internet subscribers and 2.5 million broadband users in 2006; the latter group is expected to grow in the next five years by almost 50% a year. The Internet will expand primarily through broadband, with subscribers expected to number 17.5 million by 2011. Dial-up households will drop in number, but not significantly. Consumer spending on internet access in 2006 was $3.6 bn and is expected to grow on average by 18.7% over the next five years. By 2011, Russia will represent two-thirds of total spending on Internet access in Central and Eastern Europe.

Notes to Editor
1, For additional information please contact Vera Totskaya, PR Manager, or Olesya Kuzminskaya, PR Assistant Manager.
2, About the Outlook
PricewaterhouseCoopers Global Entertainment and Media Outlook: 2007–2011, the eighth annual edition, contains in-depth analyses and forecasts of 14 major industry segments across five regions of the globe — the United States, EMEA (Europe, Middle East, Africa), Asia Pacific, Latin America, and Canada – plus a Global Overview. It is available in hard copy or electronically (PDF) for US$995 on our website. The Global Overview is available separately for US$95 in hard copy or electronically, and individual segment chapters are also available for US$95 in electronic format only.
3 About PricewaterhouseCoopers PricewaterhouseCoopers provides industry-focussed assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders. More than 140,000 people in 149 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.“PricewaterhouseCoopers” refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.