Ernst & Young: interactive media at a tipping point

Interactive media has recovered best from the recession, according to a report.

Canadian interactive media is at a tipping point.

Ernst & Young, in a 2010 industry survey of 89 companies comprising 10 media and entertainment sectors, argues interactive media is the fastest-growing segment of the media industry as advertising and consumer spending rebounds in 2011 and users increasingly access information and entertainment via internet-based formats.

‘It’s all about content, and while that’s nothing new in the industry, this time, it’s becoming clear that the majority of future revenue both from advertisers and consumers will come from services rather than products,” Neal Clarance, leader of Ernst & Young’s media and entertainment practice, said in the report.

“So everyone – from venerable newspapers to social media networks to conglomerates – is scrambling to find new and innovative ways to marry content with distribution channels,’ he added.

Interactive media is also profitable, the industry report pointed out.

Ranking overall profitability over a five-year period for a range of entertainment product, the Ernst & Young report said cable operators secured margins of 37.6%, but were closely followed by interactive media platforms at a 34.6% margin.

Away from the pipes, content producers were least profitable, with film and TV productions, music and electronic games each posting a 10.6%  profit margin.

From Playback Daily