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have also wavered, from $74.0m in 2012, to $61.5m in 2013, to $55.1m in 2014 and to $57.5m last year.

Subramaniam says that this digital decline is largely a result of the closure of Nokia’s unlimited download MixRadio service, which was very popular in India, as well as a massive fall in revenue from ringback tones (RBTs) on the back of government regulation.

“The biggest digital product, which was the RBTs [80% of digital market] has declined by over 60% in these years because of strict government regulations with regards to multiple consumer

consent requirements before the service can be activated,” he explains.

That kind of decline is hardly good news. But if you accept that mobile personalisation is unlikely to be the future of digital music consumption, then this reverse is perhaps not entirely unwelcome. What’s more, Subramaniam sees a bright future for music streaming in India.

“India will never be a download market,” he says. “We are a mobile-first and mobile-only market; 98% Android, 0.5% credit card penetration and so on. We have leapfrogged from a cassette market to a scalable ad-

supported streaming market. India has close to 40m unique monthly users of music streaming services.” Mobile data costs in India are falling, he adds, and will continue to do so, while engagement with music streaming services

MARKET PROFILE India

With close to 40m unique monthly users of streaming services, not to mention the world’s largest youth popultion of 356m 10-to-24-year-olds, India’s potential as a streaming market is huge

STATS f Population 1.25bnd GDP per capita $6,200h Internet users 237.3mc Broadband connections 18.8mi Mobile subscriptions 944m Active smartphones 191.1m Active tablets 15.2m Sources: IFPI/CIA World Factbook

INDIA

If you want to find the next 500m users [of streaming services], you’re not going to find them in the US or UK,” Rishi Malhotra, CE of streaming service Saavn, told music:)ally

at the start of 2016. “You’re definitely going to find them in India. It’s very important to a lot of people.”

Malhotra’s optimism was well founded: his company had secured $100m in investment six months previously and had just announced it had passed 18m monthly active users and 250m song streams a month. More recently Saavn (right) revealed this June that Guy Oseary had invested in the company, with the Maverick CEO talking of his excitement at reaching India’s 1.25bn residents.

Perversely – and in a way that seems to rather sum up the topsy-turvy world of the Indian music industry – Saavn’s announcements came as recorded music revenues in India appeared to be experiencing a protracted downturn. Recorded music revenue in the subcontinent has fallen for the last three years according to IFPI figures, down 7.6% in 2013, down 17.4% in 2014 and down 7.0% last year.

The main reason for this, according to Shridhar Subramaniam, president of India & The Middle East at Sony Music, is the massive decline in the physical music market, with annual CD sales falling from 34.5m units in 2011 to 21.4m in 2015. But digital revenues

India will never be a download market. We are a mobile-first and

mobile-only market” – Shridhar Subramaniam, Sony Music

“

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has increased by 300% year-on-year. India also has a number of strong local

streaming services, including Saavn, Gaana, Hungama and Wynk. The latter (below) has created particular interest, thanks to its alignment with a telco – it was launched by Bharti Airtel in September 2014 – a strong start in the market, which saw it record 5m

app downloads in its first six months, and its ability to make Indian consumers pay for streaming, albeit relatively small amounts (from 29 Rupees [$0.43] to 120 Rupees [$1.79] a month, depending on the package).

International services are much less prominent, however. Spotify has yet to launch in India; Apple Music is available, but

has struggled in a strong Android market (even though the Apple Music app is available for Android devices); Guvera has

MARKET PROFILE India continued...

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RECORDED MUSIC SALES(Volume, million units)

DIGITAL MUSIC REVENUE BY FORMAT(In US$ millions)

0

10

20

30

40

50

2011 2012 2013 2014 2015

Other physical

0

5

10

15

20

25

30

35

Paid subscriptions /freemium stream

Single-track downloads

Ad-supported streams

2011 2012 2013 2014 2015

CDs Mobile personalisation

been experiencing its own internal problems.Vijay Nair, founder and CEO of Indian

media and entertainment company Only Much Louder, says, “Apple Music has not really taken off because the iPhone itself is just about gaining in India and Android is far ahead in that game. I do believe services like Spotify can work in the near future among a certain high-spending audience. Nobody has catered to that category of fans yet in India and Saavn is the only one actively focusing on that.”

Subramaniam believes that foreign streaming services can work in India: “But other than Nokia – none have since then.”

The exception to this rule is YouTube, which is booming. The company announced in March that overall watch-time was up 80% year-on-year, with mobile watch-time up 131%. At the same time YouTube revealed that 63% of its Indian users watch music videos on the platform, a legacy of the close links between the music and film industries in India.

Mandar Thakur, COO of Times Music, says that Indian labels have embraced YouTube with open arms. “Do we make money from YouTube? Sure,” he says. “It is very rare that you will find a record label here that doesn’t have a Content ID deal or advertising deal with YouTube, or that doesn’t have their own channel.”

Piracy, of course, continues to be a massive problem – Subramaniam estimates more than 100m people side-load pirated content onto their devices in India – but the Sony executive believes that the rise of streaming will help to curb piracy. “Once these streaming services reach 150m monthly uniques, we will see piracy diminish substantially,” he explains.

Double these 150m uniques to 300m – and let’s not forget, India has the world’s largest youth population, with 356m 10-24 year olds – and the effect will be even more dramatic.

“We are three years away from being a $500m market,” Subramaniam concludes. “This will happen once we scale to around 300m monthly users. The ARPU from the Indian consumer will not increase, but we can certainly increase the number of consumers using legitimate services. We believe that the digital advertising dollars will support this growth and help consumers had a frictionless transition from piracy to legitimate consumption.” :)