Strong growth in entertainment and media sector

The Dutch entertainment and media sector is expected to grow by an average of 4.6 percent annually from 11.8 billion euros in 2006 to 14.8 billion euros in 2011. PricewaterhouseCoopers (PwC) announced these conclusions at the PICNIC conference in Amsterdam that started yesterday . The sale of Dutch games in 2006 has been overrun by music carriers

The Dutch entertainment and media sector is expected to grow by an average of 4.6 percent annually from 11.8 billion euros in 2006 to 14.8 billion euros in 2011. PricewaterhouseCoopers (PwC) announced these conclusions at the PICNIC conference in Amsterdam that started yesterday .

The sale of Dutch games in 2006 has been overrun by music carriers. And the share of the internet on the advertising market will increase significantly in the coming years, because the many internet users via broadband are more interesting for advertisers.

According to PwC, the Dutch entertainment and media sector benefited from the economic upturn and grew by 4.4 percent in 2006 against 3.1 percent in 2005. This is the fastest growth in the past five years. The segments video games and internet advertising market stand out in terms of percentage growth. Conversely, the turnover from the sale of music recordings again showed a decrease in 2006.

Digital distribution is the main driver of growth within the Dutch entertainment and media sector, says John Middelweerd, chairman of the Dutch entertainment and media practice of PwC. Internet penetration per household is the highest in Western Europe with a percentage of 78.8 percent measured in 2006. Investments in infrastructure by telephone and cable operators will enable higher broadband speeds in the future. The games market and the internet advertising market in particular benefit greatly from this in the coming years.

In 2008, the growth of digital distribution will compensate for the decline in physical distribution. In 2011 the vast majority of the income from music recordings will be achieved through digital distribution. As a result, income from music recordings will increase slightly in the longer term.

In the next five years, more revenue will be obtained from the sale of games than from music recordings. The introduction of a new generation of consoles for video games led to an increase in expenditure of 17.1 percent in 2006 to 13.3 percent in 2005. PwC expects the total Dutch gaming market to increase from 369 million in 2006 to 541 million. euro in 2011, an annual average growth of 8 percent.

Within the Dutch gaming market, console games (games for the game console) have the largest market share by 43 percent. The market for online video games grew by 20.3 percent in 2006 to 130 million euros. The still relatively small market for portable games (Portable Playstation) grew by 19 percent in 2006 to 25 million euros.

The total advertising market is finally over her dip. After a few bad years at the beginning of this century and a slight upturn in 2004 and 2005, the advertising market recorded 5.6 percent the fastest growth figures in the past five years. Moreover, this upturn is expected to continue over the next five years with an annual average growth of 4.5 percent from 2.9 billion euros in 2006 to 3.6 billion euros in 2011.

Advertising via the Internet quickly becomes more popular. The advertising revenues will increase further because the many internet users via broadband are more interesting for advertisers. Incidentally, nearly a third of the advertising market still comes from television advertising. Dutch television generated some 900 million euros in advertising revenue in 2006, an increase of 5.9 percent compared to the previous year.