Hungama becomes Bollywood gateway

Hungama Digital Media Entertainment Pvt Ltd, which has digital rights to 75 per cent of the music from Bollywood films and controls 40 per cent of the entire Indian digital music market, has signed Apple and Sony, supplying the media giants with Indian tunes for their online stores. It also sells songs directly to listeners through its own smartphone applications and websites.

The company's catalog of more than two million songs is a gateway for music purveyors to tap into Indian affection for movies and their scores worth $2 billion that depict everything from champagne-soaked nightclub parties to domestic disputes.India, a nation where 800 million people live on less than $2 a day, is also now the world's fastest growing smartphone market, according to market researcher IDC. That's a potentially huge yet challenging market for the music industry. Consumers there are used to paying only a fraction of the download price charged in Europe and the US Hungama is able to sells songs for as little as Rs 1 (2 US cents) apiece.

"Music is very much a poor man's medium too," said Vipul Pradhan, head of India's Phonographic Performance Ltd. "India's content providers have realised the line for impulsive transactions is much lower in markets like India," he added.

Discounted iTunes
Even within those constraints, Indian consumers are increasingly buying their music on smartphones, often low-cost devices that use Google's Android operating system. Handset sales may rise 61 per cent to 26.5 million units this year, according to an estimate from Canalys, a consultant with offices in Singapore.

The country's internet users will more than double to 348 million by 2017, according to a forecast from Cisco Systems Inc. The music industry, which grew 11 per cent in 2012, will more than double in size by 2017 to Rs 2,250 crore, according to KPMG. Put it all together, and big media companies see an opportunity. So they're doing business with closely held Hungama to offer Indian fare as well as Western tunes. Cupertino, California-based Apple introduced a discounted version of its iTunes store in December. Apple offers songs such as the Beatles Hey Jude for Rs 15. The songs are among the most expensive in India, but the cheapest among iTunes stores around the world.

Sony, Nokia
Sony and Nokia Oyj have also opened digital content stores for mobile users in India where they can download songs and other applications.