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Licensing royalty revenue stands at $5.065 bn in 2010: Survey

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MUMBAI: Year-to-year royalties generated from the sale of licensed merchandise remained fairly stable in 2010 at $5.065 billion despite ongoing softness in consumer spending, according to an annual Licensing Industry Survey released by the International Licensing Industry Merchandisers’ Association (LIMA).

Although the amount of royalties collected in 2010 from the sale of licensed product declined slightly, the positive retail results at the end of last year give cause for optimism and set the tone for 2011.

The survey results were released at the opening session of the LIMA-sponsored Licensing International Expo 2011, the industry’s global event taking place this week in Las Vegas.

Lima’s numbers are derived from results of its annual survey of companies directly involved in the licensing business, examination of public financial documents, and interviews with licensing industry executives, with the goal of providing reliable data to help licensing professionals identify trends and growth opportunities.

Lima president Charles Riotto said, “The Lima 2010 royalty revenues survey underscores our industry’s continuing strength and resilience against a backdrop of unsteady retail sales. Despite a 1.9 per cent decline last year, licensed products clearly hold an appeal for consumers.”

Anecdotal responses to the survey indicate a more positive business environment with indications that 2010 was a transitional year as the country started to rebound from the recession. Respondents noted that especially in the second half of 2010, decision making and deal making began to increase. They also saw a steady increase of retail sales, licensing opportunities with new kinds of retailers and a broader array of channels with significant progress seen with mid-tier, department stores and specialty/big box retailers.

Nearly half (47 per cent) of licensing industry royalty revenues are generated in the Character segment, which includes characters from all portions of the entertainment business. This segment declined by just one per cent in 2010.

Other major segments of the licensing industry include Corporate Trademarks/Brands, accounting for 16.7 per cent of the business, Fashion (13.6%), and Sports (12.7 per cent).

The music sector is the only category that showed an increase (4.5 per cent), a result of strong sales of music merchandising tied to concerts and events as well as revenue from online and mobile devices.

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