UK to continue as Europe’s leading entertainment and media market
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Editor
| 27 June 2023
Despite the general economic travails and cost of living crisis, the UK is still set to maintain its position as the leading entertainment and media (E&M) market in Europe over the next four years according to research from PwC.
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According to the Global Entertainment & Media (E&M) Outlook 2023-2027, overall UK E&M revenue is expected to reach £85 billion in 2023 with growth forecast at a compound annual growth rate of 4% over the next four years to generate revenue of £100 billion overall by 2027.

However, amid the overall gains, PwC warned that the rate of growth is expected to fluctuate year-to-year given variable economic conditions. It noted that growth rates are somewhat muted by sluggish consumer spending, which is pushing companies to reset expectations, refocus inward and seek ways to recharge growth.

Drilling deeper within the video sector, subscription video-on-demand (SVOD) revenue is forecast to grow from £3.6 billion this year to £4.7 billion by 2027. In 2025 it is forecast that SVOD (£4.2 billion) will overtake TV subscriptions (£4.1 billion) in terms of revenue reflecting a shift in audiences from linear to streaming. The major SVOD players continue to invest in content rights and original productions to maintain popularity with customers. However, PwC also believes that the rising presence of advertising-based video on demand offers consumers the chance to switch away from subscriptions models.

Overall advertising revenue in the UK is expected to be £35.7 billion in 2023, within which digital captures the lion’s share. TV advertising remains a significant medium but has faced more challenging circumstances. It is expected to decline by 3% in 2023 as budgets have tightened, but then recover with 4% growth in 2024 (£4.8 billion).

“2022 was a challenging year for the UK entertainment and media industry as the economy struggled to return to normality. In the midst of continued change and disruption, the industry reassessed its strategies and refocused on core operations,” said Mary Shelton Rose, partner and UK technology, media and telecoms leader at PwC commenting on the study. “For years, the overarching story in E&M has been a technology-inspired shift to digital and mobile. But this year, very quickly, a new force is coming into focus: Generative AI. Going forward, leaders must evaluate and embrace the potential power of AI holistically as an enabler for productivity and creativity.”

Going forward, the Virtual Reality market in the UK is expected to see steady growth in the next four years, driven by the rising popularity of VR gaming and immersive video experiences. PwC also sees strong growth for OTT video, video games and internet advertising.