India set to enter an era of revolution in live sports, semiconductor chips, AVOD, and 5G

• The Indian semiconductor market is expected to reach US$55 billion by 2026
• Indian sports market is estimated to touch US$100 billion by 2027 from US$27 billion in 2020, a CAGR of over 20%, or about twice as fast as the global sports market
• Satellite broadband and communication service market in India is expected to grow and expand with the developing use case horizon and the exponential growth in data consumption

National, 27 February 2023: Amidst strong global headwinds on the economic front, India is set to emerge as a major player in the 5G revolution, semiconductor and chip technology, live sports, and AVOD with private deployment networks likely to take off in a big way during 2025-2028 period, according to Deloitte’s 2023 TMT (Technology, Media, and Entertainment, Telecom) predictions.

Technology sector prediction – an exciting time for India’s semiconductor industry
Deloitte predicts the Indian semiconductor market to reach US$55 billion by 2026 with more than 60% of the market being driven by three industries—smartphones and wearables, automotive components, and computing and data storage. With growing demand, the industry is poised to play an important role in enhancing the global value chain, as it will expand to a market size of US$85 billion and generate employability for 600,000 by 2030.

“The semiconductor chip shortage over the past two years has amplified the importance of this industry and exposed the underlying risks in the value chain, owing to geopolitical threats, fluctuating demand from original equipment manufacturers (OEMs), natural disasters, and economic sanctions.

These factors, however, also present a unique opportunity for India, positioning it as the next big manufacturing destination. Driven by key factors including an increase in semiconductor content, the advent of 5G and IoT, and data storage requirements, the sector will also attract investment, talent, and bi-lateral relations focusing on supply chain, resilience, and localization setting in India”. said P. N. Sudarshan, Partner and TMT Industry Leader, Deloitte India.

He added, ‘’The ambitious proposal from the Government of India (GOI) regarding the Production Linked Incentive (PLI) and Design Linked Incentive (DLI) package is expected to attract investments and establish India as a center for semiconductor manufacturing. We anticipate market and portfolio, manufacturing, R&D, and talent as the dimensions for growth prospects by 2026.”

Media sector prediction: Live sports – The thrilling emotions strengthen valuations!

According to Deloitte’s analysis, the Indian sports market is estimated to touch US$100 billion by 2027 from US$27 billion in 2020, a CAGR of over 20%, which is about twice as fast as the global sports market. We predict that the success of new talent in sports and government initiatives will accelerate the growth of diverse sports in India. Additionally, the rising popularity of NFTs, merchandise and IP-related sports commerce among sports persons and fans, especially Gen Zs, is expected to benefit a diverse range of sports.

Furthermore, while television will remain to be relevant, digital will roar, and ad pricing may witness slow growth or even a plateau. However, an increasing focus on the sports infrastructure ecosystem, sports commerce, and international sports are some trends that will remain steady in the Indian sports market.

Jehil Thakkar, Partner, Media and Entertainment Sector Leader, Deloitte India, said, “This year’s prediction brings in the trend of live sports' increasing value with each new season. A key reason for that is the rising interest in allied consumer monetization models in every country, such as fantasy sports apps, NFTs, and social media revenue.

As the Indian sports market grows, it is essential to keep an eye on digital growth and infrastructure development, given that the Indian sports market is predicted to grow twice as quickly as compared with global markets”. He added, “This year’s 2023 TMT predictions also highlight how the Indian entertainment industry has embraced the OTT ecosystem with open arms, leading to a surge in hybrid models.“

“The hybrid model offers a balancing act, providing access to a high-monetization user base and a wider audience that may eventually convert into monetizable users.”

Telecom sector prediction: 5G’s promised land finally to arrive

The economic impact of 5G is driven by cross-sector contributions leading to productivity and efficiency gains through the deployment of 5G use cases across industries.

The growth of 5G Standalone (SA) networks is expected to witness and further accelerate private network deployment. Satellite companies are also at the forefront of innovation in communication technology, developing next-generation, powerful, high-throughput Ka-band satellites, increasing coverage area and utilizing cutting-edge technologies for secure connections.

Peeyush Vaish, Partner and Telecom Sector Leader, Deloitte India, said “India's push towards advancing its telecom and data center infrastructure, coupled with the availability of a multitude of approaches for private network deployment, presents a great opportunity for enterprises to utilize edge computing and 5G technology to enhance their operations, agility, and competitiveness.

According to Deloitte’s assessment, as the 5G private network ecosystem continues to evolve, stakeholders need to collaborate and create India-centric use cases that demonstrate the technology's impact across industry verticals. The potential benefits of 5G private networks in sectors, such as manufacturing, retail, agriculture, transportation, and health care cannot be ignored. It is time for Indian enterprises to explore the possibilities and take a leap in their digital transformation journey."

Deloitte’s predictions mainly capture the critical roles of these technologies in our hyperconnected world and underscore India’s strong ecosystem to support the growth of digital, blurring the lines between urban and semi-rural.

Other highlights include:

1. India’s rendezvous with satellite broadband: India reached the highest wireless data consumption per user in the world with average monthly wireless data consumption per user reaching 16.4GB in 2022. Deloitte predicts that this figure is only projected to triple to ~54GB per month by 2028. Additionally, we also project India's satellite broadband service market size to reach US$1.9 billion by 2030, at a CAGR of 36%.
2. 5G standalone networks can transform enterprise connectivity: The economic impact of 5G could potentially be US$450 billion by 2040, driven by cross-sector contributions for productivity and efficiency gains through 5G use case deployment across industries. Telcos are expanding their 5G reach at a commendable pace, extending their enterprise connectivity and private network-based offerings. In addition, a multitude of approaches available in India for the deployment of private networks, and the existence of both stand-alone and non-stand-alone modes, will drive the proliferation and adoption of 5G private networks.
3. M&A in Software-as-a-Service and agri-tech enterprises would be the theme of deal activities in 2023: Heading into 2023, funding and M&A activity in India are expected to gather steam and ramp up substantially. While the deal flow in gaming M&A is likely to accelerate globally, M&A activities in the Indian gaming industry could be limited, owing to regulatory challenges and social norms. Deloitte predicts that M&A activity in the Software-as-a-Service (SaaS) space, and in impact sectors such as agritech, is expected to emerge as key investment themes in India's Technology, Media, and Telecommunications industry. Key SaaS verticals expected to garner interest from financial as well as strategic investors in 2023 are cloud-native, Hyper Intelligent Automation (HIA), Web 3, and verticalized SaaS solutions. Industry estimates reveal that the Indian agritech sector is poised to become a US$34 billion market by 2027, growing at a CAGR of 50% over the next five years, a steep rise from the current US$4 billion market size. Start-ups in this space raised around US$4.6 billion in 230 deals in FY22, from US$2.1 billion in FY21, with the total start-up count closing at 1,300 in June 2022.
4. Balancing content and cost-effectiveness: AVOD revenues in India grew much faster than in developed markets, as customers were willing to opt for the flexibility to watch content across multiple platforms at a lower price. OTT accounts for 7-9% of the overall media and entertainment industry, and this share will continue to accelerate in the foreseeable future. In addition, India’s OTT market revenue was about US$2.35 billion in 2022 and is expected to reach almost US$5.3 billion by 2027. SVOD revenue is expected to grow at a CAGR of 19% to reach US$2.9 billion in 2027 from US$1.2 billion in 2022.

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This press release has been issued by Deloitte Touche Tohmatsu India LLP.
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