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U.S Entertainment and Media Spending to Hit $720B in 2020

First time internet ads would surpass TV broadcasting, according to PwC

The internet is poised to surpass TV in advertising dollars for the first time according to Pricewaterhouse Cooper’s annual “Global Entertainment and Media Outlook” report. Forecasting the outlook of consumer spending and advertising revenues for 2016–2020, PcW’s report predicts that the U.S.’ entertainment and media spending to reach a total of $720 billion by 2020; 2015’s spending was $603 billion per the report.

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Internet advertising in the U.S., according to PcW, is the largest in the world, earning $59.6 billion in revenue for 2015. By 2017 PcW expects internet advertising to earn $75.3 billion, which would overtake TV advertising’s projected revenue of $70.4 billion. PcW indicates that TV advertising is still seeing a growth from year to year — with a projected 2.8% compound annual growth rate (CAGR) for 2017 — the internet’s is simply growing at a much faster rate, with PcW’s report projecting 9.4 CAGR to $93.5 billion by 2020. China’s market looks to have a higher CAGR at 14%, but PcW expects the U.S. to remain the largest market in terms of revenue.

Mobile advertising is one of the key contributors for internet ad revenue, with PcW saying it makes up 34.7% ($20.7 billion) in 2015. Those numbers are projected to rise to 49.4% by 2020. Mobile video internet ad revenue is forecast to have the biggest growth from $3.5 billion in 2015 to $13.3 billion in 2020. PcW points to the planned rollout of 5G networks to boost mobile consumption of video.

In addition, PcW’s outlook for TV and video revenue shows a potential increase of 0.5% CAGR from $121.4 billion in 2015 to $124.2 billion by 2020. Some areas of interest include the growth of video on demand and OTT services. Electronic home video sales’ $11.2 billion eclipsed box-office sales ($10.2 billion) in 2015, two years ahead of PcW’s 2015 Outlook report’s projections.

PcW’s “Global Entertainment and Media Outlook 2016–2020” report also looks at cinema, video games, newspaper publishing and live experiences.

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