Latest Updates

Sumit Opposite Kareena
Saif Versus Nawaz
Qaidi Band Versus Lucknow Central
Priyank Sharma To Debut

Singing The Blues

While India ranks 20th among the world’s biggest music markets in terms of value, why aren’t we singing a happy tune? Shweta Kulkarni explores

zadfregr

There’s no denying that music is the backbone of the entertainment industry in India, yet the music industry is still to find its perfect melody. Before we delve into why business is not what one hoped it would be, take a look at the projections made by KPMG in a report compiled in 2015.

Based on information from the Indian music business, in association with FICCI (the Federation of Indian Chambers of Commerce and Industry), the report ranked India 20th among the world’s biggest music markets in terms of value. It said that by 2019, the Indian music industry is expected to achieve the Top 10 spot.

This prediction was music to the ears but, sadly, it was off-key. The fact is that with a steep drop in physical sales and limited revenue generated by music streaming services, the music industry is not showing any growth.

Atul Churamani, Managing Director, Turnkey Music & Publishing, points to some key challenges that have curtailed the growth of the industry in India. “While the rest of the world is seeing growth in terms of numbers, I don’t think we have had growth here. We have had a flat year, rather, the numbers are slightly depressed.”

Churamani cites a couple of reasons for this state of affairs. “One reason is the almost total collapse in physical sales. Interestingly, markets in Europe still have 50-60 per cent of their revenues coming from physical sales. And when physical sale collapse, it takes a lot of digital streams to make up for the loss of one CD,” he remarks.

“We have an issue because we have almost no physical sales, shops have shut, and people don’t really buy music online as everything is shifting to streaming. And while the streaming business is good, YouTube has become a significant contributor to the music industry… Caravan, Gaana… They are all trying but it is still a challenge to get people to pay for subscriptions to listen to music.

“Moreover, advertising in terms of streaming services is still in a very nascent stage. As an advertiser, you are probably happy to put your money into television rather than go with a streaming service. So, it’s going to take at least a couple of years for it to stabilise and start generating the revenues we are hoping for,” Churamani explains.

He adds, “The KPMG report in 2010 said the Indian music industry was worth Rs 950 crore and would grow 17.6 per cent by 2013. In 2013, the industry was at Rs 960 crore, up Rs 10 crore from 2010. In 2013, they said it would be Rs 1,350 crore in 2017, and in 2017, the report doesn’t even have music in it!”

The industry, which once boasted a turnover of Rs 1,150 crore in the late ‘90s, is now reeling under abysmally low numbers. However, Vinit Thakkar, Senior Vice-President, Universal Music India, is optimistic.

“I believe the music industry is on the cusp of change and this change is taking place on account of many factors. First and foremost, with greater penetration of data, greater penetration of smartphones, greater adoption of data, dropping data prices… the consumer has started consuming a lot of media and entertainment content online. Music is probably one of the core items that individuals consume digitally.

“Then, you have different avenues or platforms; there are several streaming players that offer really good experiences to consumers. There has been a big shift in the way music is being consumed. And because of all this, I believe growth is imminent. More and more people are consuming music digitally,” explains Thakkar.

He points out that this is only considering the traditional side of the music business; there’s also the live and events side to consider. “We have noticed that, in the last couple of years, the number of people attending stand-alone concerts and music festivals is increasing with every passing year. People are willing to pay for experiences and are consuming music in return. So, at one end, the digital ecosystem is changing, and there are avenues or platforms where people can consume content either on their devices or in the form of live experiences,” he reveals.

Thakkar points to the most powerful catalyst for the change in music consumption patterns. “Over 52 per cent of people in our country are below the age of 30. When you look at all this, I strongly believe that growth is imminent and the music industry is on a trajectory of growth from here on. Overall, there’s an upswing in international music consumption. We are seeing this trend across streaming partners here, and I am confident that this will only grow further. The influx of international acts touring the country is also testimony to this exciting growth area,” he avers.

Mahendra Soni, co-founder & Director at SVF Entertainment, shares Thakkar’s optimism. “I think this is the best period for the music industry because of the kind of revenue music gives us. Let me give you an idea of this. We make an almost 20 per cent profit from music. We don’t invest in music. Music is part of films. And there are almost 40 streams from where you can make money.

“Usually, with every medium, if you make a film you have one satellite, one digital and one music. With music, there are multiple players on each platform – telco (both domestic and international), OTT operators, digital stores like the Apple store and so many more… wherever you can download it. Then, there’s licencing, which is a broadcast licence; then to sync such as Sa Re Ga Ma Pa, Indian Idol etc. Then publishing, which is IPL (Indian Premier League). Then, you go to shop rights, then radio stations. Toh ek gaana hit ho gaya toh kitne paise milte hai? It’s such a big market but you need to deliver a hit.”

Delivering hit numbers is crucial to the music business. Like any other industry, quality content ensures good returns. Ratan Jain, Bollywood producer and co-founder of Venus Records and Tapes, says a soon as we start creating good music, growth will follow. “Music created in the ‘90s is still popular. The problem the music industry is facing today is that there is no great new music coming in. In India, we have only film music; the non-film music scene is not big. That’s why, popular music is always film music. And in the last few years, very few films have had really good music,” Jain points out.

He reasons that the ‘90s had super-talented composers like Nadeem-Shravan, Bappi Lahiri, Anu Malik, Rajesh Roshan and Jatin-Lalit, and back then every film had five to six songs, most of which were good. “That era is almost over. Now we have many music directors in one film, doing different songs, item numbers and recreated songs, Still, we have barely two to three memorable songs. In the recent past, Ae Dil Hai Mushkil had some really good numbers but, other than that, we haven’t had many memorable songs. The worry is not that the music industry is not doing well; the problem is that we are not creating good songs.”

There’s another challenge that’s much tougher to tackle – music piracy. Experts say that 99 per cent of music consumption is illegal. This is an obvious obstacle to the growth of the music industry. Says Ratan Jain, “There is a lot of music being downloaded illegally even though, legally, the charges are low.”

Churamani doesn’t mince words when he says, “The joke going around is that if legit services are giving it free, then piracy main kya problem hai? But the fact is piracy is rampant and can’t be easily controlled. The challenges we have in India are that there is no physical sale, a very low update on subscribers as well as very little advertising in streaming services. So, we face challenges from the user, we face challenges from pirates and we face challenges from advertisers.”

True enough, the lack of advertisers to generate revenue further muddies the waters. According to Churamani even the pricing of music needs to change if we are to drag ourselves out of this predicament. He says, “I was in London recently and I bought a physical CD there. On average, I pay 5 pounds for a CD, or Rs 400, while an Amazon Prime subscription for an entire year is Rs 600. So something is clearly wrong with the way music is priced.

“You have a subscription from Apple at rs 120 a month for streaming 10 million songs. A CD with just 20 songs costs a lot more. So there are many challenges that need to be addressed.”

He believes that streaming services need to limit the offers they have for subscribers. “If I listen to jazz music, why would I look at a Bollywood collection; and if I want Bollywood, I should subscribe to it separately. If I am willing to pay, rest assured, I will be willing to pay for what I want. Why would I be willing to pay for something I don’t want?

“Music doesn’t work like that. If you listen to the blues, try as I might, I will not be able to make you listen to bhajaans. Music is an acquired taste and a very personal choice. So it is foolish to offer so many songs all in one go. All one is doing is devaluing the music.”

Churmani cites an interesting example. “When physical music was sold, the store made money when they sold CDs and cassettes. So their aim was to sell. When they made a sale, we made money. Now, digital stores have taken the place of physical stores but digital stores are not necessarily interested in selling music. They want people to visit their store, toh free main aap aajao, ya saste main subscription lelo, to attract advertisers.

“And one way to get people to come to the store is by offering free music. So, straightaway, the store is not in alignment with the music business, the music label or the artiste and producers; it is devaluing. On the other hand, physical stores were trying to raise the value of the music. This inherent conflict in the business needs to be addressed.”

Soni too is positive about the growth in the industry, “We have around 800 songs in our library and we intend to take that to 2,000 in the next three years. It is going to grow and the music industry can sustain the losses of the entire year. You have good years and you have bad years. How do you sustain yourself through your bad years? Then there’s revenue from YouTube. So many people do cover versions of songs, and, eventually, everything is music.”

Despite the flux and uncertainty, the experts are optimistic but no one’s venturing any predictions. Says Thakkar, “It is very difficult to say what kind of returns one can expect because the shift is still taking place. When you look at people’s consumption habits, we know there is a lot of music that is consumed across the pirated platform. However, the good news is there is also a huge number of customers who have moved from consuming music on pirated platforms to legitimate streaming services, even though many of them are consuming on a free tier, which is an ad-supporter tier and are yet to pay for a monthly subscription. All indicators are pointing in the right direction and monetisation is likely to take place very soon.”  

Shweta Kulkarni
Collection Chart
As on 22nd July, 2017
FilmsWeekWeeklyTotal
Jagga Jasoos1
42.71Cr
42.71Cr
Shab
1
17.33L
17.33L
Love Icon1
1.81L
1.81L
Ghanta Chori Ho Gaya
1
20K
20K
War For The Planet Of The Apes**114.20Cr14.20Cr
MOM*27.46Cr28.17Cr
More

Featured Video

Most Viewed Articles

Today

Last 7 Days

Last 30 Days

Twitter

Box Office India's Twitter avatar
Box Office India
@boxofficeindia

Check out the First Day First Show Collections of #Mubarakan #Udaipur t.co/g6yZlOVQ5W

Box Office India's Twitter avatar
Box Office India
@boxofficeindia

Check out the First Day First Show Collections of #Mubarakan #Kota t.co/Ag51mgACWJ

Facebook

Instagram

This Week’s Issue

TRADE GUP

  • Sumit Vyas to play opposite Kareena Kapoor Khan in Veere Di Wedding.
  • Qaidi Band versus Lucknow Central.
  • Bhoomi will release on September 22.
  • Priyank Sharma to Debut.

IN CONVERSATION

  • The Mubarakan boys – Anil Kapoor and Arjun Kapoor In conversation with Box Office India
  • Team Baaraat Company in conversation with Team Box Office India
  • Arpita Mukherjee has lent her voice to a heartfelt song Haathonmeinthhehaath in the film Mubarakan.
  • Aman Trikha has lent his voice to Shah Rukh Khan for the song Butterfly

STRAIGHT NEWS

  • Ajay Devgn, Arbaaz Khan to Dub
  • Priyanka Chopra Is Special Guest
  • Official Statement from Producer Prernaa Arora.
  • KriArj Entertainment Join Hands with Reliance Entertainment