Animation Market By Type(3D Animation, Stop Motion, Flipbook Animation), By Application(Media & Entertainment, Automotive, Others), By Revenue Stream(Over-the-Top (OTT), Advertising, Sale of Tickets, Others), By Industry(Media and Entertainment, Education, Retail, Others), By Region And Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends, And Forecast 2023-2032

Animation Market Size, Share, Trends Analysis

The global animation market was valued at USD 399.1 Billion in 2022. It is expected to reach USD 779.0 Billion by 2032, with a CAGR of 7.1% during the forecast period from 2023 to 2032.

Rising demand in media and film industries and advancement in technologies are two primary forces driving growth in the global market. The surge in demand for OTT is due to the internet penetration globally and new technological advancement which is used to create high-precision IoT networks are other factors for market growth.

Animation has an immense demand in the video gaming industry and is one of the essential components of contemporary game development. Animation is like giving life to the virtual characters and environments that have become important in developing immersive and realistic games.

A key animation industry opportunity lies with the Gen Z demographic worldwide based on data showing 74.2% of those ages 18-24 play video games regularly across 5 major countries. Additionally, video games rank as the top entertainment activity for Gen Z spanning the US, UK, Germany, Brazil, and Japan. This signals strong appeal for interactive animated content.

Given Gen Z's impact on future entertainment technology and content, their preference for games and digital animation creates rising demand for animated entertainment catered to young adults. From video game design to animated series, there is growing global market potential to engage Gen Z consumers through various animation mediums focused on their interests. Capturing Gen Z attention represents a major animation growth area.

Animation can be used to improve any game quality from simple and traditional 2D animation to modern and complex 3D animation. 2D animations are the most basic type of motion film which use bitmap graphics and are not as sophisticated. 3D stop motion is creating realistic 3D characters and objects that can work together within any virtual environment. 3D animated films require much more work than 2D animations and that is the reason why CGI companies are choosing 3D stop motion for gaming.

The media and film industry, playing a vital role, heavily utilizes CGI on digital platforms for promotional purposes, engaging audiences with high-quality content and immersive content. Companies like Walt Disney led in releasing animated films, illustrating the power of animated films in creating limitless characters and worlds. These films allow storytellers to explore narratives impossible with live-action alone, often incorporating Artificial Intelligence in Animation to enhance storytelling.

Animated films have become one of the favorite and popular films among all age groups. Filmmakers use CGI to discover complex themes and ideas that may be difficult to narrate in live-action but easy in animated films. For example, "Grave of the Fireflies" is a Japanese animated war film that tells the story of the impact of war on civilians.

The motion picture has allowed the filmmakers to develop a creative, stylish yet realistic story of the horrors of the war that left a strong impact upon the audience. Cartoon has provided a platform for creative themes and ideas through which narrating a story has become easy. Advanced technologies will continue to expand which will contribute to the market expansion during the forecast period.

Animation Market Dynamics

Media and Entertainment Industry Expansion Fuels Animation Market Growth

Media and entertainment's rapid expansion is a primary driver of growth in the global industry. As this sector flourishes, there is an ever-increasing demand for various animated movies, TV shows, and web series content - not limited to traditional markets but globally spread across various cultures and languages. The resulting surge in demand for animation services stimulates investments in animation studios and technological advancements, leading to a dynamic and competitive market environment. The long-term prediction is a sustained growth trajectory for the market, bolstered by a continuously evolving media landscape and the increasing global appetite for diverse animated content.

Growing Demand in Evolving Economies Boosts Animation Market

The burgeoning demand for animation in evolving economies significantly contributes to the growth of the global motion picture market. As these economies grow, there's an increase in disposable income and digital penetration, leading to higher consumption of animated content. This trend is particularly pronounced in countries with a young demographic profile and enjoys a strong appeal. This growing demand is encouraging both local content creation and international collaborations, diversifying the market and fostering innovation. The anticipated long-term impact includes the emergence of new animation hubs in these economies, further enriching the global motion picture landscape.

Technological Advancements Propel Animation Market Forward

Technological advancements, particularly in cloud computing and mobile solutions, are pivotal in driving the global animation market's expansion. These technologies enable more efficient and flexible cartoon production processes, making high-quality animation more accessible and cost-effective. Cloud computing allows for enhanced collaboration among global teams, breaking down geographical barriers in animation production. Meanwhile, mobile solutions are expanding the distribution channels for animated content, reaching wider audiences through smartphones and tablets. These technological strides are not only enhancing current production capabilities but are also shaping the future of motion pictures, with an emphasis on accessibility, collaboration, and innovation.

Limited Access to Advanced Technology Restrains Global Animation Market Growth

The global animation market's growth is significantly hindered by limited access to advanced technology in certain regions. The motion picture requires sophisticated software and hardware that may be prohibitively costly or hard to source in certain regions around the world, creating a technological divide; only those in regions with robust infrastructures can fully participate and contribute to the global animation industry. As a result, the market's growth potential is curtailed, and the diversity of creative inputs is limited, impacting the overall richness and variety of global CGI (Computer-Generated Imagery)content.

High Production Costs Restrains Global Animation Market Growth

High production costs are a major barrier to the growth of the global animation market. Creating stop motion, particularly of high quality, is a resource-intensive process involving skilled artists, advanced software, and sometimes costly hardware. These factors contribute to significant expenditures, making it challenging for smaller studios or independent animators to enter the market or sustain operations. Additionally, the increasing expectation for sophisticated, high-quality stop motion further drives up production costs. This financial barrier not only limits market entry but also restricts innovation and experimentation within the industry, as players may be inclined to stick with proven, less risky formats and stories.

Animation Market Segmentation Analysis

Type Analysis

3D animation represents the majority share of the animation market, due to its realism, depth, and dynamic visual appeal. 3D animation's widespread adoption across movies, television shows, and video games attests to its dominance. Technological innovations in rendering, motion capture, and 3D modeling have improved its quality and efficiency - leading to greater application across industries and accelerating this segment's expansion. 3D's rapid rise is further propelled by an ever-increasing demand for high-quality visual content across entertainment as well as other industries.

Stop motion and flipbook animation, while niche, are revered for their artistic and traditional values. 2D animation, despite being overshadowed by 3D animation, remains relevant, particularly in contexts where simplicity and cost-effectiveness are paramount. These segments contribute to the diversity of the market and cater to specific audience segments and artistic preferences.

Application Analysis

The media and entertainment sector is the primary application area for animated film, driven by the burgeoning demand for animated content in films, TV shows, and online platforms. The proliferation of digital platforms and the global reach of animated content have significantly expanded this segment. The versatility of stop motion in storytelling and its cross-cultural appeal solidify its dominance in this sector.

In the automotive sector used for design visualization and marketing. Online education utilizes animated films to create engaging and educational content, a trend that has accelerated with the growth of e-learning. The 'Others' category, encompassing sectors like healthcare and architecture, uses animated film for simulations and visualizations. While smaller in comparison to media and entertainment, these segments are crucial for their specialized applications and contribute to the industry's expansion.

Revenue Stream Analysis

OTT platforms represent the largest revenue stream for the animated film market. Streaming services such as Netflix, Amazon Prime, and Disney+ have led to an explosion in demand for animated content. Their global reach and investment in original productions are major contributors to its rapid expansion.

Advertising uses animated films to create compelling and memorable commercials, contributing significantly to the market. The sale of tickets for animated movies, particularly in cinemas, remains a substantial revenue stream, although it faces challenges from the increasing dominance of OTT platforms. The 'Others' category includes merchandising, DVD sales, and syndication rights, which, while declining, still play a role in the overall revenue landscape.

Industry Analysis

The media and entertainment industry is the cornerstone of the animated film market. This segment leverages animation in various forms, from blockbuster movies to animated series and web content, driving substantial growth in the industry.

In education, stop motion is increasingly used for creating interactive and engaging learning materials. The retail industry utilizes animated films for product demonstrations and advertising. These industries, while not as dominant as media and entertainment, are pivotal in diversifying the application of animated film and contributing to its overall growth.

Animation Industry Segments

By Type

• 3D Animation
• Stop Motion
• Flipbook Animation
• 2D Animation

By Application

• Media & Entertainment
• Automotive
• Online Education
• Others

By Revenue Stream

• Over-the-Top (OTT)
• Advertising
• Sale of Tickets
• Others

By Industry

• Media and Entertainment
• Education
• Retail
• Healthcare
• Manufacturing
• Others

Animation Market Growth Opportunity

Rising Viewership of Media Content Offers Growth Opportunities in the Global Animation Market

An increasing viewership of TV shows, movies, and other forms of media content is one of the key contributors to global animation market growth. Recent years have witnessed an apparent increase in media consumption across various platforms including streaming services and traditional television, which may be attributable to increasing content diversification as well as global accessibility of media sources. Animated content, known for its universal appeal across age groups, benefits immensely from this trend. Recent data indicates a steady rise in the popularity of animated shows and movies, signaling robust opportunities for expansion in production, distribution, and technological innovation within the animation industry.

Increasing Adoption of Animation in Education Fuels Market Growth

The growing use of animation in educational settings opens up significant opportunities for the global market. Educational institutions and content creators are increasingly turning a tools to enhance learning experiences. Animated content can simplify complex concepts, engage students more effectively, and cater to various learning styles. The recent shift towards digital and remote learning environments has further accelerated this trend. The demand for high-quality, educational animated content is rising, not just in traditional academic settings but also in online education platforms and corporate training programs, suggesting a broadening market scope and potential for innovation in educational stop motion.

Animation Market Regional Analysis

North America Dominates with Majority Market Share

North America, holding the largest market share by region, significantly influences the global animation market. The region's pioneering role in technology and content creation, combined with a strong culture of storytelling, drives its market dominance. The U.S., in particular, is home to globally recognized studios like Disney and Pixar, whose innovative approaches and wide-reaching franchises have set industry standards.

The market dynamics in North America, characterized by market revenue estimates indicating substantial investment, are shaped by high investment in technology, including CGI and 3D animation, and a large, diverse audience base. The integration of animation into various media platforms, from television to streaming services, further expands its reach. Additionally, collaborations between North American studios and international partners have broadened the market's scope and influence.

Europe: A Hub of Creative Talent and Diversity

Europe's animation market is distinguished by its rich tradition of storytelling and a diverse range of styles. European animation studios are known for their distinctive artistic approaches that often combine traditional techniques with cutting-edge technologies. This diversity, coupled with collaborations across countries, fosters a dynamic and innovative market environment.

Asia Pacific: Rapid Growth and Expanding Influence

The animation market in Asia Pacific is growing rapidly, driven by increasing demand for animated content and advancements in technology. Countries like Japan, South Korea, and India are significant contributors, each with their distinctive styles and burgeoning industries. The region's large, young population, coupled with growing digital penetration, creates a vast audience for animated content. This demographic and technological shift positions Asia Pacific as an emerging powerhouse in the global landscape.

Animation Industry By Region

North America

• The US
• Canada
• Rest of North America

Europe

• Germany
• France
• The UK
• Spain
• Italy
• Russia
• Netherlands
• Rest of Europe

Asia-Pacific

• China
• Japan
• South Korea
• India
• New Zealand
• Singapore
• Thailand
• Vietnam
• Rest of Asia Pacific

Latin America

• Brazil
• Mexico
• Rest of Latin America

Middle East & Africa

• South Africa
• Saudi Arabia
• UAE
• Rest of Middle East & Africa

Animation Market Share Analysis

In the global animation market, the prominent players listed collectively contribute significantly in terms of diversity, innovation, and strategic positioning. Adobe Systems Incorporated and Autodesk Inc., with their powerful software suites, are pivotal in shaping the technological backbone of the industry. Their tools have become synonymous with professional creation, highlighting the market's dependence on cutting-edge software solutions.

Corel and EIAS3D, though smaller in scale, contribute significantly through niche offerings and specialized tools, catering to specific needs within the process. MAXON Computer and SideFX, known for their robust 3D animation and visual effects software, underscore the industry's constant push toward realism and high-quality graphics.

Smith Micro and Newtec Inc., with their focus on user-friendly and versatile solutions, reflect the market's expanding base of amateur and semi-professional animators. Videocaddy and Animation Sharks, operating primarily in the realm of service provision, highlight the growing demand for outsourced animation services, indicative of the market's global interconnectedness.

Triggerfish Studios and GRAFTON, though regionally focused, have made significant international impacts, showcasing the power of cultural diversity and storytelling. Finally, industry giants Pixar, Walt Disney Animation Studios, and DreamWorks Animation demonstrate the immense influence of content creators in shaping market trends, consumer preferences, and the overall direction of the animation industry.

Together, these key companies not only drive technological advancements and creative excellence in the global market but also highlight the varied strategies - from software development to content creation and service provision - essential in navigating this multifaceted and rapidly evolving industry.

Animation Industry Key Players

• Adobe Systems Inc.
• Autodesk, Inc.
• Corel
• EIAS3D
• MAXON Computer
• SideFX
• Smith Micro
• Newtec Inc.
• Videocaddy
• Animation Sharks
• Triggerfish Studios
• GRAFTON
• Pixologic Inc.
• Walt Disney Animation Studios
• DreamWorks Animation
• Zco Corporation
• Trimble Inc.
• Animaker Inc.
• Bondware Inc.
• Exocortex Technologies
• Sony Corporation
• Image Metrics, Inc.
• Newtek Inc.
• NVIDIA Corporation

Animation Market Recent Development

• In October 2022, The Walt Disney Company’s ILM’s Mumbai facility was to operate a complete VFX and animation services pipeline, working on content for the local market to access the Southeast Asian talent pool. The studio is expected to work on VFX and animation projects of varying sizes and scales for TV, film, and streaming, as well as in-person attractions.
• In July 2022, Cinesite announced that it acquired a majority stake in animation & mocap studio Squeeze, located in Quebec City and Montreal. Squeeze is an animation studio located in Quebec City and Montreal with an international reputation. This acquisition was expected to allow Cinesite to increase further its content and service offerings for global markets while bringing mocap and unreal capabilities into the group to service video game and film productions.
• In January 2020, AARDMAN ANIMATIONS LTD, in collaboration with Greenpeace, unveiled a compelling animated film focused on raising awareness about the critical challenges facing the world's oceans. This impactful release not only contributed to increased revenue but also strengthened the company's product portfolio, positioning it for market expansion.

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