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PwC survey: Kenya’s entertainment and media revenue to rise to Sh619.7 billion in 2028

Generative artificial intelligence (genAI) promises efficiency and productivity gains, while also disrupting business models across and between multiple industries

Kenya’s Entertainment and Media (E&M) markets revenues are projected to reach Ksh 619.7 billion (US$4.8 billion) in Kenya at the end of the forecast period, up from Ksh 490.6 billion (US$3.8 billion) in 2028.

According to PwC’s Africa Entertainment and Media Outlook 2024–2028s, E&M markets in Kenya as well as those in Nigeria and South Africa, the other two countries covered, are showing resilience against a backdrop of global macroeconomic instability. All the three African markets saw revenue growth ahead of the global average of 5.0% in 2023. Growth was strongest in Nigeria, at 15.0%, while South Africa and Kenya saw increases of 11.7% and 5.8% respectively,

Over the next five years, the report says E&M revenues in all three markets are expected to rise ahead of the global average of a 3.9% Compounded Annual Growth Rate (CAGR). E&M revenue in South Africa will increase from R295.3 billion (US$16.1 billion) to R363.2bn (US$19.8 billion). In Nigeria, the market value will grow from US$9.0 billion in 2023 to US$13.6 billion in 2028.

Some segments in these territories, such as live music, have finally recovered to surpass pre-COVID revenue levels. Other sectors, like internet advertising, are achieving impressive scale, while ongoing infrastructure deployments and rapid growth in data usage will fuel demand and drive fixed and mobile service revenue growth.

Linear value chains are disaggregating in favour of digital ecosystems. The global content boom from streaming growth has stalled. Generative artificial intelligence (genAI) promises efficiency and productivity gains, while also disrupting business models across and between multiple industries. It all adds up to widespread uncertainty and a growing imperative for business model reinvention. PwC’s 27th Annual CEO Surveyreveals 57% of E&M CEOs, versus 45% of all CEOs, believe their current business model won’t be viable in ten years.

The report says that going forward, emerging technologies will continue to disrupt and transform E&M. AI is set to significantly impact the industry by enhancing content creation, recommendation and production processes. GenAI can quickly convert ideas into images, stories or scripts, while AI-powered analytics will drive production choices and improve user experiences. Technical advances like network optimisation and automated customer support can reduce costs.

Meanwhile, the 5G rollout is continuing in Africa and 5G E&M use cases for the technology span areas such as cloud gaming, video streaming and VR. Africa has a younger population compared to many other regions. This demographic is more inclined towards digital and mobile platforms, driving growth in sectors like mobile gaming, esports and over-the-top streaming (OTT) services.

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According to the report, the total E&M market in Kenya is expected to grow at a 5.2% CAGR, with internet advertising and OTT leading the way. Kenya’s internet advertising market is projected to be the fastest growing in the world at a CAGR of 17.4%.

In South Africa, the most established market, with a projected CAGR of 4.2% through 2028. Growth is expected across all segments other than print media. OTT and internet advertising will see some of the highest growth rates, supported by stable internet connectivity and 5G adoption. Video games and esports remain a segment to watch, promising promising strong future growth.

The report adds that Nigeria is one of the fastest-growing E&M markets globally, with an 8.6% CAGR. The fastest-growing E&M segments through 2028 in Nigeria include internet advertising, video games and esports, OTT and music, radio and podcasts. Internet advertising revenue is expected to more than double between 2023 and 2028.

Unlike many global markets where fixed broadband is prevalent, Africa’s E&M growth is primarily driven by mobile services due to low fixed broadband penetration. The expansion of 4G and 5G networks is crucial for connectivity, with mobile subscriptions significantly outpacing fixed broadband. South Africa and Kenya will reach a tipping point where 4G subscriptions overtake 3G by the end of 2024, while in Nigeria, this is expected by 2026. Consequently, Africa lags one technological generation behind the global trend, where 5G is expected to overtake 4G by 2027.

In line with global trends, video leads as the largest content category in South Africa, taking an 82.2% share of all data consumed. Social video is the main growth driver within the video sector, with platforms like TikTok and Instagram growing in popularity in the market. In Nigeria, games also make up a significant share of data consumed.

“E&M is a realm in which real-life, in-person, increasingly tech-enabled experiences—music performances, theatre, cinema, sports and more—matter a great deal. Live music and events are rebounding strongly post-COVID (a trend seen both globally and in Africa), with notable performances and festivals across the continent. Despite challenging market conditions, the OTT market in Africa is still growing, with significant investments in infrastructure and content. The number of OTT subscriptions is projected to increase despite recent subscription price increases and the removal of free subscription tiers. South Africa is set to add nearly 1.6 million additional OTT subscribers by the end of 2028,” says the report.

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It adds that the global shift towards digital and mobile platforms is reflected in Africa: mobile gaming dominates, with fast-paced growth in esports. Uniquely, Kenya’s traditional gaming revenues still exceed mobile in 2023 and will retain their lead throughout the forecast period.

“While internet advertising is growing globally, Africa—particularly Nigeria and Kenya—is experiencing exceptionally high growth rates. This is driven by increasing Internet penetration and the adoption of digital platforms. Globally, advertising is projected to account for a significant portion of E&M industry growth. Internet advertising is set to lead ad spend, with AI and retail search influencing the segment. Retail search advertising accounted for 27.3% of paid search revenue in Nigeria in 2023, driven by a strong local e-commerce sector.”

The PwC report ranks South Africa as the most well-established E&M market compared to Nigeria and Kenya and will therefore see the slowest growth over the forecast period, at an overall CAGR of 4.2%. Growth is expected across all segments aside from newspapers, consumer magazines and books, which is a segment that is also seeing declines in many other global markets due to its reliance on print.

OTT, cinema and internet advertising are expected to be the fastest-growing metrics but for very different reasons. Ongoing infrastructure development and greater 5G adoption will help improve connective stability, fuelling growth in OTT and internet advertising. International blockbusters will help drive the cinema industry in South Africa, which has been experiencing a challenging few years and is starting to show steady recovery to pre-pandemic revenues by 2027.

“South Africa’s resilient E&M market will see significant growth in OTT and internet advertising, driven by stable connectivity and 5G adoption, but must adapt to business model reinvention amidst digital ecosystem shifts and AI disruptions,” says Alinah Motaung-Tshabalala, PwC Africa Entertainment and Media Leader

On the other hand, Nigeria has one of the fastest-growing E&M industries, driven by its population of over 230 million, with a median age of 18.1 years. This predominantly young demographic represents significant consumer potential for the E&M sector. Additionally, government investments aimed at expanding its footprint across various industries further contribute to this impressive growth rate. It is widely acknowledged as Africa’s leading E&M hub, home to the world-renowned Nollywood movie industry, which produces around 2,500 films annually. Nigeria will see the fastest growth over the forecast period, compared to South Africa and Kenya, at an 8.6% CAGR.

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The fastest-growing E&M segments through 2028 include internet advertising, video games and esports, OTT, and music, radio and podcasts. Internet advertising revenue is expected to more than double between 2023 and 2028, which will be fuelled by Nigeria’s broadband plan that aims to provide effective broadband coverage to 90% of the population by the end of 2025.

“With a youthful population eager to embrace innovation, Nigeria’s entertainment and media industry can harness the power of genAI to capitalise on this disruptive force, unlocking new opportunities for growth and development,” says Udochi Muogilim, Technology, Media and Telecommunications Leader, PwC Nigeria

Kenya remains the smallest of the three markets but will see solid growth of a 5.2% CAGR over the forecast period. All segments will see increases through 2028, with internet advertising and OTT expected to be the fastest. Kenya is expected to have the fastest growing internet advertising market in the world between 2023 and 2028, with an increase at a 17.4% CAGR pushing total revenue from US$163mn to US$365mn.

“Kenya’s E&M industry is poised for remarkable growth, with the world’s fastest-growing internet advertising market and a leading position in mobile game spending driven by rising smartphone accessibility,” Laolu Akindele, Technology, Media and Telecommunications Leader, PwC Kenya, says.

4G subscriptions to overtake 3G by end 2024 in South Africa and Kenya
South Africa and Kenya, mobile subscriptions split by type, 2019-2028 (mn)

Fig. 2

The connectivity category is the largest contributor to the E&M industry globally and in Africa. Fixed broadband penetration rates are very low across the markets covered. In Nigeria, less than 5.0% of households have a subscription to fixed broadband, while penetration is at just 10.4% in Kenya and 46.3% in South Africa.

“Growth is, therefore, coming from the mobile sector, which is supported by consumers continuing to adopt 4G packages and the expansion of the 5G rollout. Both South Africa and Kenya will experience a key tipping point by the end of 2024, when the number of 4G subscriptions will overtake 3G. Nigeria will lag these two markets, reaching this tipping point in 2026. Globally, 4G has led the mobile market for several years and 5G is expected to overtake this category in 2027,” it adds.

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