The modern face of the media and entertainment sector globally has experienced a massive change in recent times. The digital nature of the way that we access news, movies, music and TV shows now has opened up a whole new front in this industry.
The figures around the media and entertainment sector certainly reflect the health it is in. In the UK alone, a recent report from accountancy giants PwC forecasted that it would be worth £72bn by 2021. This was up from a similarly impressive £62bn in 2016. The same healthy figures can be seen in media and entertainment around the globe, as US-based Netflix has shown with 109 million members in 190 countries.
What does all this mean as an investor? The state of the industry and the money inside it suggests that there are some great opportunities to be considered.
Investment ideas for media and entertainment in 2018
If you have some money to invest, then this is a growth sector that certainly should be thought about carefully. With many believing that it will only grow as the years increase due to new technology helping us to connect more with it, getting in now could be a wise move.
Here are some areas within the industry that make interesting investment ideas:
- Tech-based funds – of course, many investors will look at buying stocks and shares in media and entertainment companies to profit. While this is one option, it may also be worth thinking about investing in funds instead. While there are no current funds that contain exposure to actual media or entertainment companies as such, you can invest in more tech-based ones that deal in providing services for businesses in the sector. The beauty here is that you have a good contingency against one company dropping in price as the others will hopefully make up for it.
- Film industry – one interesting investment to look at is the film industry. The UK film industry, for example, is currently on the up and re-establishing a globally positive reputation. Edgar Wright’s Baby Driver took around $226m at the box office despite only costing $34m to make. This is a great return for the investors who were behind it and shows just why many are putting their money into film now.
- Blockchain-based companies – one new development that many think will greatly impact media and entertainment is blockchain. This cutting-edge technology provides an open and transparent system to facilitate things such as payments online. Many think that this is an area that will take off quite soon, so it might be worth investing money now. Try to look out for blockchain-based media and entertainment businesses or those that may provide key services to businesses in the sector.
- Online gaming – online gaming is a massive sector in which to get involved. Currently, it generates $13,551m in revenue annually and is fast becoming the major way that people enjoy video games. From online casino games to multi-player battle royales, they connect with millions of consumers worldwide. This makes the companies that develop the games or the platforms that people play them via online an investment opportunity to consider.
- Online streaming platforms – whether it is TV, films or music, online streaming is a big player in the sector now. It is how many consumers choose to access their media channel of choice. If you are thinking of investing money into media and entertainment, then online streaming platforms such as Amazon Prime are definitely worth considering. With their popularity only expected to increase, it could see a good return on your initial outlay.
What about virtual reality?
One area that many believe will take off in the coming years is virtual reality (VR). VR has long been talked about as the next big breakthrough in entertainment with uses for it in gaming and how TV and movies are viewed. This makes it one area within entertainment that could be worth investing in now to see handsome returns. From companies making VR games to the equipment needed to use it, investing in stocks here or helping to fund VR start-ups could make perfect sense.
Investing in a growing sector
Naturally, the above is only advice on potential areas within the sector to consider investing in. It is vital to perform your own research and due diligence before actually investing real money.
Whatever niche within media and entertainment you may decide to invest in though, there is no doubt that the whole sector is on the up at the moment. With more people than ever using the latest technology to stay entertained at home or on the commute to work, it seems that this will only continue into the future. This means that investing some money into the industry now could prove a wise move.