MUMBAI: The digital market in India is currently growing at a very rapid pace and is expected to propel to greater heights with newer forms of consumption coming in. Aiming to encash on the opportunity, the space has recently seen a lot of players entering and offering an innovative experience to consumers. Inspite of rising opportunities, revenue earning is now emerging as major challenge for most players.
The digital music market in India is broadly classified into streaming and downloads services, which cater to different needs of the modern consumer. While the market continues to grow and the content consumption drives up too, major sources of revenue have remained as advertising, subscription and paid downloads.
Recent reports also suggest that music is the main driver for digital platforms in India like YouTube, and with a larger number of services entering the market, the business models too need to evolve.
Speaking with Radioandmusic.com, Hungama Digital Media Consumer Business & Allied Services COO Siddhartha Roy said, “The consumption on digital has begun and it continues to grow at a very fast pace. The market is big enough for all of us to play as India’s digital story is just beginning. The content consumption is growing and the internet will reach millions more people this year.”
Identifying the opportunities the market presents, newer players like iTunes entered into the space recently, and are further helping the legitimate music market to move ahead. Other existing players like Flyte, Dhingana, Saavn and more also contribute a major share through their unique product offering.
Moreover with consumption on the mobile platform increasing too, the opportunities opening up are just immense. Many reports also state that FY 13-14 will see around 35-40million devices being sold, further fuelling growth.
“The digital market is surely going to benefit with players like iTunes. We are the largest strategic partners for them and a large number of audiences are now using the iPhone and iPad which is a closed ecosystem in itself. The pricing is also very decently done keeping in mind the Indian audiences, thus drawing large traffic,” he pointed out.
Inspite of seeing very positive signs ahead; there are still some hidden hurdles the digital music market has to face too. While piracy still remains to be a continuous battle for aggregators, revenue generating streams also need to be constantly explored.
The growing consumption is driving aggregators to build greater connectivity with their product and improve the bandwidth offering as well. But, Roy claims that the customer now wants to own the content and is willing to pay for it. In order to sustain themselves in the long run, business models need to evolve and there needs to a push towards a paid ecosystem.
He elaborated, “There is a lot of investment being made in products but the returns are not as much. Even the advertising margins get stretched as there is a lot of inventory, so we need to push for a paid ecosystem now to help us get more returns and need to fuel revenue through subscriptions. Another thing we have to understand is that the customer today wants to own content and is willing to pay for it. He thus calls for downloading instead of streaming services.”
With free services not stated to help the market or the players grow in the long run, most platforms are now turning their services into paid subscription models as well. While Hungama’s Artist Aloud has recently announced paid services across platforms, Saavn too was stated to announce its paid subscription model. Not staying far behind in the race, tech giant Google’s YouTube India too is all geared up to launch its paid subscription model soon.