[Reader-list] Article on Music e-tailing /Prashant Pandey

[Prashant Pandey]

Music e-tailing in India will kick off in a year

Ashish K Tiwari / DNA
Sunday, October 23, 2005  20:02 IST

Leading players in the Indian music industry are getting serious about
making their repertoire available for download in the domestic market,
at a cost though.

While companies like Saregama India, Universal, Sony-BMG Music, etc,
have already made their music available in the international markets
(through sites like www.itunes.com and www.napster.com) for download
at a cost per download, the approach didn't gain momentum in the
Indian market so far.

Non-availability of Internet connections, at desired speed for fast
download, across the length and breadth of the country was an issue
which delayed the entire process. Besides, making available the entire
music repertoire in a digitised format was another aspect which had to
be dealt with to start the process.

Kulmeet Makkar, chief executive - music, Saregama India Ltd, said,
"The fraternity has been considering online distribution of music as
an option to maximise reach and revenue for some time now. With the
telecom boom, broadband services getting better and majority of the
music being digitised, an online distribution model can be expected
soon."

The domestic music fraternity, along with the Indian Music Industry
(IMI) - an association to protect the interests of the music industry
in the country, is believed to have designed a tentative revenue model
for online distribution of music that needs to be finetuned. In fact,
according to a source, the music industry is expected to arrive at a
business model in six to 12 months.

Savio D'Souza, secretary general of IMI, said, "We have been
discussing about this mode of music distribution in India and would
come out with some concrete details after taking into account every
aspect related with this."  V J Lazarus, head of IMI which is based in
Mumbai, was not available for comment.

The total size of the Indian music industry is estimated to be about
Rs 1,000 crore. Of which, piracy contributes to the tune of Rs 450
crore. The organised market of film music in India is Rs 400 crore
while non-film music is around Rs 100 crore. Approximately 90% of the
revenue for the music industry comes from the sale of CDs and
cassettes. Over 9% is shared between ring-tone sales and royalties
from Phonographic Performance Ltd while online retailing is under 1%.

The primary reason behind this minuscule percentage of online sales is
illegal download. According to industry observers, there are over 600
URLs that facilitate illegal download of Indian music and legalising
music download at a cost is being viewed as a strategy to deal with
it.

"Illegal download of music is our biggest concern as of now and we are
taking necessary steps to curb it. In fact, IMI is aggressively
working towards making these websites dysfunctional, thereby boosting
revenues for the industry," said D'Souza.

Pioneering the e-tailing approach, Saregama India made its music
available online through the company websites, www.saregama.com and
www.humaracd.com, way back in 2000.

The sites offer a selection of 25,000 songs. One could get a personal
compilation of songs in the range of Rs 275 to Rs 375 for a CD
(shipment cost extra) with the option to customise the look of the CD
as well.

"Though revenue from this initiative has been small as compared with
CD and cassette sales, we see a great potential in this service in the
prevalent market scenario. We are in the process of reviving this
facility making available majority of our music repertoire in the
digitised format which was not the case earlier," said Makkar.

Starting October 1, Universal Music has begun selling its Indian music
repertoire in the international markets through music retailing
websites like 'itunes' and 'napster' at 99 cents per download. "We are
in the process of working out a revenue model for the Indian market,"
said Rajat Kakar, managing director, Universal Music (India) Ltd.

As an experiment, Rediff has recently started selling music online in
India with the launch of singer Sanjay Maroo's album for online music
download. All the 11 songs of this album are available for download
for Rs 10 per song.

Jasmeet Singh, vice-president of product marketing for Rediff, said,
"Normally for any download, the process has to be routed through IMI.
But in this case, the singer approached us for online distribution of
his music and we decided to take it forward.

We'll have to wait and watch for the response and if the figures look
good we will look at regularising it provided the artiste holds online
distribution rights of his/her songs." Singh has been in talks with
IMI and feels that a single-window licence from the association would
help to a great extent in e-tailing Indian music.

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Forwarded by Prashant Pandey