The increase in targeted broadcasting hours by cable and satellite TV, availability of low cost internet access, penetration of mobile devices along with the growing popularity of streaming video has catapulted the demand for animation, VFX and gaming. In addition, the demand for Animation and VFX content to power immersive experiences such as Augmented Reality and Virtual Reality is growing exponentially.
The total value of global animation industry was US$ 259 billion in 2018 and is projected to reach a whopping US$ 270 billion by 2020.
There is a significant increase of the global animation, VFX and games production taking place in a globally distributed mode.
The rapid advancement of technology has made animation, VFX & games available to the masses, and this industry has become one of the fastest growing segments in the global media and entertainment market. Production work is becoming collaborative, global and seeking support from cost effective and quality conscious studios in Asia. This is a model which is increasingly being tapped by content producers.
MARKET SIZE
Most of the segments in the animation industry are growing at the rate of 2% YoY. The spend on special effects as a percent of production cost is about 20%-25%. The traditional form of content viewership is giving way to a sharp increase in streaming video consumption. The size of streaming market for animation content was US$ 2.9 Billion in 2018 and is growing at an annual rate of 8%. The size of global video gaming industry was US$ 96 billion in 2018. Global eSports industry is growing at the rate of 30% YoY & is predicted to be a billion-dollar industry by 2019.
STRATEGIES, TRENDS, OPPORTUNITIES, GROWTH FACTORS
Consumers are consuming more immersive content across channels such as ultra-high definition TVs, tablets and smartphones to head mounted devices. There is a growing appetite, compelling demand from Global consumers for High Definition Visual Experiences.
The need for engaging visual effects and realistic animation is ensuring studio include more animation and VFX shots in films.
Animation, VFX and games content is being consumed not only on Netflix, Amazon, Hulu and Twitch, but also on YouTube, Twitter and Facebook. With the growing internet penetration and access to multimedia devices, customers are spending more time on streaming digital content. Streaming video is the fastest growing segment distribution channel for animation and is witnessing double digit growth and the same is expected to continue for the next few years. This growth is attributed to the exponential growth in the number of online video viewers throughout the world. Cloud computing is playing a key role in character rendering and modeling processes as cloud based rendering of animation films is more effective and efficient as it reduces the time and cost compared to traditional rendering.
Cloud Gaming services which are growing at an exponential pace would need the right pricing model to both drive adoption and generate sufficient returns for platforms and publishers. The availability of low cost micro-payment systems is allowing users to pay for access or download small quantities of digital content and is the key for online games market to grow. Artificial Intelligence and Machine Learning based techniques are being used for in-game analytics, customer acquisition, retention, cross sell, churn, classify player behavior etc.
Popular eSports tournaments have rich spectator interactions and immersive fan experiences for in-person and online viewers. Micro-segmentation of fans is emerging as eSports leagues and tournament are consolidating various genres, platforms and viewing experiences by careful customer segmentation, targeting and positioning. China has become a leader in eSports and several tournaments are organized throughout the year with millions participating in both online and offline modes.
Thus, with easy accessibility to low cost internet, the growth of technology and rise in demand for content it is only imperative studios will need to deliver top class products and continue improving on their deliveries.
