According to the latest "PwC's Global entertainment and media outlook 2018-2022 report", Hong Kong's digital revenue overtook non-digital in 2017 on advertising and consumption spend at US$4.5billion and US$4.3bn respectively. It goes on to forecast a compound annual growth rate (CAGR) of 5.1% at US$5.8 billion in revenues by 2022, citing biggest growths in OTT video, e-sports, video games and most importantly, internet advertising.
This segment will grow at 9.9% CAGR to reach US$732m by 2022 – a surge thanks to the 90% mobile internet penetration in the city. No surprise, mobile internet advertising will be a major contributor to, if not dominate, the percentile jump: it's speculated to account for 39% of the total revenue and is expected to grow at 14.1% CAGR to hit US$285m by 2022.
OTT video saw a revenue growth of 14.1% CAGR, a full 4% higher than the global growth of 10.1% between 2017 and 2022. According to the same report, the OTT video market is propelled by consumer content demand, lower prices and portability preferences. It is expected to rise with increasing mobile access and connections.
Video Games and E-sports
Valued at just over US$1bn by 2022 from a 4.9% CAGR, video game advertising generated USD$791m in revenue last year, all due to Hong Kong's large and thriving market that allows unrestricted access to overseas games, unlike China. Within these numbers, 60% of the total revenue stems from social and casual gaming, the majority of which take place on smartphones powered by strong broadband speeds in the city. Though small in comparison, e-sports is making its dent in the city, attracting the likes of game developers, advertisers and sponsors in formats of sponsorship and media rights.
Source: Perspectives from the Global Entertainment & Media Outlook 2018–2022 - PwC