UK to ‘overtake Germany’ as Europe’s largest media market

The UK is set to become the biggest entertainment and media market in Europe, overtaking Germany, according to PwC’s latest Global Entertainment & Media (E&M) Outlook 2022-2026.

UK E&M revenue is expected to reach £83 billion this year. PwC’s report predicts that the UK market will achieve growth of 4% annually over the next four years, the second fastest growth rate in Western Europe. UK E&M revenue for next year will see the UK become the leading market in Europe and by 2026  revenue is anticipated to generate £97 billion, according to the report.

The UK will continue to be the leading market for over-the-top video in Western Europe and the third largest market globally after the US and China, says the report.

Overall UK OTT video revenue is forecast to reach £3.6 billion this year before growing at 6% p.a. over the forecast period

PwC also predicts that virtual reality and mobile augmented reality revenue will almost double during the forecast period. The UK will remain the largest VR market in Europe, Middle East and Asia and the growth for the sector is forecast to be driven primarily by video games content with the sector set to build on the success of the Meta Quest 2 headset.

Advertising will drive revenue in the UK’s mobile AR market with branded filters becoming more of an important vehicle on photo and video-sharing apps.

Spending on internet access, both at home and on mobile in the UK is forecast to grow at a CAGR of 5%, driven by mobile internet access which is forecast to overtake fixed broadband access next year and then beyond and by the end of the forecast period to account for 53% of total internet access revenue.

Internet advertising revenue is forecast to grow to £26 billion this year and by 6% a year to 2026 which will equate to just over a third of overall E&M revenue.