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News |  18 Feb 2013 18:33 |  By RnMTeam

2013 to be very challenging for SIMCA

MUMBAI: Amidst reports that digital is the future of music industry, the dark truth is that the south Indian music industry is struggling at different aspects to enable sustainability in the long run. With streaming services holding a bigger stake than downloads, garnering revenues has emerged as a hurdle along with constant battle with digital piracy.

Even as physical piracy has comparatively reduced in the south Indian music industry, it has been taken over by digital piracy with a maximum share being attributed to the growing consumption on mobile resulting in mobile chip piracy.

Speaking with, South Indian Music Companies Association (SIMCA) joint secretary Rajesh Dhupad, “If the size of the Indian Music Industry is Rs 575 crores (as reported by earlier), then I would peg the south Indian music industry between Rs 200-300 crores. However if you include the pirated market, it would be much more because the total piracy industry on the internet is around 95 per cent.”

While overall in India, piracy contributes 75 per cent of the music industry, it is a huge figure in Tamil Nadu followed by the markets in Kerala.

Dhupad states that physical piracy has reduced and comprises of only around 30 per cent of the industry, but it is not having a positive impact as the piracy on digital and mobile platforms has steadily increased and now comprises of around 70 per cent of the industry.

“The industry is omnipresent everywhere and today music is primarily consumed on mobile which comprises of 70-80 per cent of all music heard today. While the physical piracy has decreased, the overall piracy in the market has increased due to mobile,” he added.

Today, there are three main methods of getting content, namely legitimate downloads through CDs, pirated downloads from the internet and the third, which is the majority, is from mobile chips. Every time a consumer buys a new phone, the seller offers a memory card with a pack of songs for a sum of around Rs 200. While this encourages piracy, the music industry earns nothing from it.

Aiming to curb this form of piracy, SIMCA in association with South Indian Digital Music Management (SIDMM) enabled licensing of music on the mobile platform through Cell Muzik. The organisation provided licenses to the shopkeepers on a yearly basis and then collected revenues from them.

Apart from that, they also conducted several raids with the anti-piracy wing in Tamil Nadu, but the results have not been very impactful. With the government and state agencies not supporting the initiatives taken by SIMCA, the signs of change are pretty weak.

Dhupad claimed, “Hundreds of crores are being lost through piracy and the conviction rate is also very poor so our raids are also having no impact. The pirates caught are easily let off without any conviction and just have to pay a fine of Rs 2000 or spend a night in jail. Many a times they get prior information and our raids prove ineffective.”

While large sums of money are being lost due to rampant piracy in the south, revenue making has also emerged as a challenge with streaming services being the preferred choice of consumers over download sites. Because of the move, the southern music industry has not been able to generate any money from downloads as they are not happening in a accountable quantity.

“The truth is that money is only coming in from sites like Nokia Store, Flipkart and Ovi. The others are mainly into streaming, while other download sites are showing negligible progress,” he pointed out.

With streaming services providing the latest music to consumers for free, labels are also not producing qualitative music as it is not viable for them in the long run. Although many industry players claim that a paid ecosystem needs to be brought into force to enable the industry to sustain in the long run, Dhupad expresses that the culture of buying music online has not yet evolved in India and people still need to be made aware of it.

He said, “The music industry can’t survive with these models, people need to get used to pay for music. The industry won’t survive free of cost. New music is freely available online free of cost, so it does not help the industry and neither will new music be viable.”

A thoughtful solution to the predicament could be pushing for paid subscription models for free streaming services in the long run, where listeners have to pay a certain amount to hear songs. The move needs to be enforced as the ad revenues will not help streaming services or the industry to sustain in the long run.

Highlighting the growth of the industry in 2012, Dhupad stated that it was a mere 15-20 per cent through the digital and mobile platforms. 2013 is stated to be a very challenging year for SIMCA as they have decided to go to the operators directly, and there will also be hectic activity regarding content management which is expected to show good results.