NEW DELHI: Revenue levels in India's media and entertainment sector are due to rise rapidly in the next few years, driven by evolving digital trends and growing expenditure among advertisers.

Ernst & Young, the consultancy, estimated there are 750m mobile subscribers in India, alongside 100m pay-TV households, 70,000 newspapers and over 600 television channels.

It reported that India's media and entertainment industry was worth $16.3bn last year, a figure forecast to hit $18.3bn in 2011, $20.6bn in 2012, $23.1bn in 2013 and $25.8bn in 2014.

Farokh Balsara, from Ernst & Young's media and entertainment team, said: "Having one of the world's youngest populations, high volumes of content consumption, a favourable regulatory framework and growing digital adoption, makes India an attractive investment destination for global media and entertainment companies."

Web penetration has reached just 7% in India thus far, well below the 31% registered in Brazil, 34% in China and 41% in Russia. However, broadband user numbers are set to rise from 17.2m in 2010 to 187m in 2015, with the vast majority utilising wireless connections.

More broadly, Ernst & Young predicted that the "rapid convergence of networks, devices and content" should push India's total quickly upwards in this area.

Smartphones were also anticipated to play a key role in transforming the market, with these devices now starting from a price of $93, measured against an entry point of $267 in 2010.

Some 77% of Indians utilising smartphones have installed approximately 30 apps each. Around 45m people had also sent text messages about their favourite reality shows while watching them on TV, and the country's web users are 64% more likely to view online video than the worldwide norm.

Elsewhere, the analysis revealed India's advertising to GDP ratio stands at 0.34%, versus figures of 0.44% in China, 0.64% in Western Europe and 0.97% in North America. The global average is 0.75%.

Television currently takes 44.5% of adspend, ahead of newspapers on 42%, meaning these two channels dominate the market. Online classifieds are the top digital category, albeit with a value of only $200m.

Rising income and spending levels, as well as greater media use should fuel a surge in discretionary expenditure on leisure and entertainment, and stimulate brand owners to boost advertising budgets.

Ernst & Young further suggested that marketers would soon place a stronger emphasis on second and third tier towns, which account for 73% of urban consumption. Hindi and regional-language newspapers and TV stations are likely to benefit as a result.

Data sourced from Ernst & Young; additional content by Warc staff