Foreword

TMT Predictions 2022

In last year’s TMT Predictions report, we called COVID-19 a catalyst for the trends we were seeing in the TMT industry. Now, nearly two years in, we still can’t escape its impact. But we do expect that 2022 will be about far more than recovering from the pandemic.

It’s true that COVID-19 has accelerated many of the trends we highlight: the lockdown-driven lift in console gaming, churn due to greater competition among streaming video services, the decline in viewing share among traditional TV broadcasters, the increasing adoption of health and wellness technologies, and the growth in 5G and other advanced connectivity for both enterprises and households. But we also look at new and shining opportunities that are emerging regardless of the pandemic. In this latter category sit technologies like RISC-V, bringing the advantages of open source to chip architecture; quantum computing and its cousins, quantum communication and quantum sensing; addressable TV technology that can help expand television advertising’s reach; and nonfungible tokens (NFTs), which offer new avenues for monetizing sports and other media. In fact, sports NFTs started trading after March 2020, but already generate over a billion dollars in trades! Some of this year’s predictions are cautionary. The tech industry has continued to make progress in women’s workforce representation, but sustaining this may take redoubled effort. Men and boys will likely continue to read fewer books than women and girls, with implications for academic achievement and social skills. And stricter AI regulations may be on the horizon, with the potential for restricting or even banning some AI applications.

Yet there are also many bright spots to share. Emerging privacy-enhancing technologies can help address AI’s privacy and security challenges. The easing of the global semiconductor shortage may be in sight, and the billions of dollars’ VCs pouring into new semiconductor companies are a spur to innovation. Smartphones are being used for longer, reducing their environmental impact. And floating solar panels, aka floatovoltaics, are poised to expand the renewable energy mix.

We hope this year’s edition of TMT Predictions both reflects the world we now live in and illuminates the world to come.

Ariane Bucaille

Global Technology, Media & Telecommunications industry leader

Gillian Crossan

Global Technology sector leader

Kevin Westcott

Global Telecommunications, Media & Entertainment sector leader

[i] https://thefederal.com/entertainment/ott-market-expected-to-grow-to-us13-15-billion-over-next-decadereport/

The pandemic has increased technology and digital adoption across industries, and heralded hybrid work environments reliant on technology-led solutions. Consumers are becoming digital savvy, and enterprises more data-driven; they are using digital technologies to serve their customers, employees, and partners. The government’s recent announcement on the Production Linked Incentive (PLI) scheme for the semiconductor and electronics manufacturing industry has garnered interest from global MNCs. PLI has the potential to create an end-to-end ecosystem for manufacturing electronic products. We expect the broader shift to digital to continue in 2022, and drive the industry growth in the future.

P. N. Sudarshan,

Partner and TMT Industry Leader, Deloitte India

According to Deloitte’s analysis, India is expected to reach 1 billion smartphones by 2026 from 750 million currently, which is 75% of the total base compared with 70% as on date. Over the next five years, India will sell US$250 billion worth of handsets domestically. 5G will alone contribute 80% to devices that will be sold in the next five years − that is 840 million 5G smartphones. The recently announced incentive package of US$10 billion to boost semiconductor manufacturing in India will spur handset manufacturing and make India the second-largest smartphone market in the next five years.

Peeyush Vaish

Partner, Telecom Sector Leader, Deloitte India Evolving consumer behavior in view of the pandemic has amplified digital content consumption in India. Audiences are experimenting with genres and languages with regional content breaking out of its traditional boundaries. Greater adoption by audiences, the popularity of international content (such as Korean, Israeli, or Spanish) in India, and the ability to attract a wider audience through subtitles and dubbed content, have broken previously held views on the characteristics of the Indian market and forced many streaming companies to revise their original strategies. Fierce competition is likely to persist in the short-to-medium term with more than 40 service providers.

According to our 2022 TMT predictions, the OTT space is expected to grow at a CAGR of more than 20% to reach US$13−15 billion over the next decade.[i]This growth will be driven by heavy investment in original content, pricing innovations, low data costs, and the rise of short-form content. However, this progression from the early to mass stage might come at a cost to the broader media industry as subscribers, especially in tier-1 and tier-2 cities, may switch to more streaming content from traditional linear TV. We, however, do not expect India to cut the cord. Gaming and commerce are also key to attract and retain consumer attention as well as bring stickiness for media and entertainment players as the battle within the evolving digital world continues.

Jehil Thakkar

Partner, Media & Entertainment Sector Leader, Deloitte India