Digital music is streaming to success: Ficci KPMG

Growth in music consumption (both online & mobile) is expected to drive over Rs 20 bn revenues for music industry by 2017

 

The music industry has gone through drastic changes as the industry has been on a digital overdrive for the past several years and digital music is streaming to success with higher web penetration coupled with rising influence of social media.

The FICCI-KPMG Indian Media and Entertainment-Industry Report 2013 indicated that 2012 was the year of discovering music as consumers finally showed some indication of broadening consumption beyond bollywood as other genres showed vibrancy.

Technology enabled personalization in music discovery through various mobile and internet apps while cloud storage assisted in managing the content swiftly.

Digital tunes are now being played like never before contributing 57% to the Rs 10.6 billion music industry which grew pie 18% Y-o-Y.

While the TRAI guidelines restricting the automated renewal of Caller Ring Back Tones (CRBT) dampened the growth momentum - achieving a 16% Y-o-Y growth against our expectation of 18%.
 
Revenues from digital platforms are expected to gradually gain pace and grow at a CAGR of 21.7% over 0the next five years. By 2017, digital revenues will contribute 72% to the music industry’s revenues.

This growth will be on  the back of availability of faster broadband speeds and the uptake of subscription based online music services. Growth in music consumption (both online and mobile) is expected to drive the music industry to revenues of over INR 20 billion by 2017.

Social media continued to blur borders and promote music consumption, thereby fostering talent unlike before. More and more independent artists were able to find an audience and also monetize their content, albeit in a small way, the report said.   

Jehil Thakkar, head of media and entertainment, KPMG in India, said, “Digital and broadcast video are driving growth in the music business. Performance licenses also saw growth. These will continue to drive the industry forward and over the medium term, more than compensate for the loss of revenue from CRBT and radio revenue”

Live music performance also came into its own and provided a platform for audience engagement to both established artists as well as budding talent.

According to the report, the industry is now gearing to take the digital audience to the next level by offering enhanced and affordable music services online and on mobile devices.