MUMBAI: India's media and entertainment industry grew 12% in 2013, according to a new report which also sees the digitisation and expansion of regional media offsetting a decline in ad revenues last year.

The study, from consultants KPMG and trade body the Federation of Indian Chambers of Commerce and Industry (FICCI), suggested the total sector was worth Rs. 92,000 crore in 2013.

It suggested that media and entertainment firms had shifted their focus from revenue growth to profits, and were paying more attention to operations and efficiency.

Jehil Thakkar, KPMG India's head of media and entertainment, noted the challenging macroeconomic environment and argued that the industry had performed much better than many others.

He said that while growth in TV ad revenues had slowed there had been a compensating increase in subscription revenues. There had also been some movement of advertisers from television to print due to the advertising cap restricting TV advertising time to no more than 12 minutes per hour.

While growth in the print sector had been steady overall, growing at a CAGR of 8.5% to Rs. 24,300 crore, English language publications had seen lower advertising expenditure while regional titles had benefited from assembly elections in five states in December, the report added.

But one publisher was sceptical of the electoral effect. "The growth is largely led by ads from commercial enterprises, and [the] impact of political advertising in enabling this growth is very minuscule, since it comes at loss of opportunity vis-a-vis government advertising," Pradeep Dwivedi, chief corporate sales and marketing officer at Dainik Bhaskar Group, told Livemint.

He expected that the coming year would see a continuing polarisation of advertising expenditure, with the top couple of titles in each market gaining a disproportionate share of spending.

Digital advertising was growing faster than any other category, as the report noted the internet user base had increased 73% to 214m in 2013, with almost two thirds of these (61%) users going online via mobile devices.

Separate figures from GroupM, a media agency network owned by WPP, showed digital advertising increasing at 30% in 2013 and a predicted 35% in 2014. At Rs. 2,520 crore, however, these ads accounted for only a small share of the media and entertainment industry total.

Data sourced from Livemint; additional content by Warc staff