India today ranks among the top five economies of the world when assessed in terms of purchasing power parity. Adding to this outlook is the fact that the average Indian is showing a greater propensity to indulge and entertain himself. The Indian entertainment Industry is thriving on the current economic upswing and is currently estimated to be INR 222 billion. Propelled by innovation across its value chain and a series of enabling regulatory actions the entertainment industry is expected to grow annually at almost 18 percent to reach INR 588 billion by 2010.

The entertainment industry has been aided by the fact that India has been the second fastest growing economy in the world. In 2004 it grew by 8.2%. In terms of purchasing power parity it is already the fourth largest economy in the world. Major companies are of the opinion that it will become a key market in the years to come. As the Indian economy continues growing, the Indian middle class has also expanded significantly. Compared to the other nations, the 300 million strong Indian middle class allocates a higher percentage of its monthly expenditure on Entertainment. There is an increase in the direct consumer spends on entertainment and advertising revenues have also been on the rise. The entertainment industry is now at an inflection point. The earlier phase of growth has run its course. Now the industry is ready to enter a second stage of growth powered by the twin engines of technology and an enabling regulatory
environment. The increasing penetration of technology is a major force shaping the entertainment landscape today. It will completely revolutionize content delivery as well as the viewer ship experience. Due to the imminent impact of these and other technologies, the successful media and entertainment companies will be the ones that are prepared for their disruptive effects on their models and the industry structure.