With Apple today announcing the launch of the iTunes store in India apart from Russia, Turkey, South Africa and 52 additional countries, it will become harder for users to justify their pirated entertainment libraries on personal devices. Earlier, the iTunes Store in India was mostly a marketplace for free digital books and podcasts.
A KPMG reports suggests that digital music’s share in the overall music market in India will grow from the current 49 per cent to 79 per cent by 2015 at Rs 1475 crore and close to 50 per cent of music revenue in India comes from mobile downloads.
The cost of downloading music from some key platforms (Price/song )
|Nokia Music Store
Offers unlimited music subscriptions, no individual downloads
~10 or 99 DRM free content pieces for ~99
Shridhar Subramaniam, president, Sony Music (India and Middle East) believes that iTunes’ launch will lead to the start of paid download services outside the operator ecosystem. “The experience, range and the market friendly pricing is very attractive so we are confident that the store is going to make a big impact. Over 400,000 songs from our global catalogue is now available to Indian consumers and we expect a great response."
Apple has priced its content very reasonably, with individual songs starting at Rs 7 and music albums starting at Rs 70, than the US iTunes store where tracks cost upwards of $0.99. Apple’s iTunes also allows to rent and download movies. A high definition version of movie like Ek Tha Tiger is available for purchase for Rs 490 and standard version for Rs 290. Users also get the option to rent the title for Rs 120 (HD version) or for Rs 80 (SD version).
In India, Hungama too offers movies and already has a subscriber base of more than 50,000 paid users that is expected to grow 3 times in the next 12 months. Recently Hungama Movies also launched in the Middle East and Singapore and expects to have 10,000 subscribers in the first phase.
According to a FICCI-KPMG Indian Media and Entertainment Industry Report 2012, the Indian music industry clocked 19 per cent year-on-year decline in sales of physical music which was compensated by a jump of 24 per cent year-on-year in digital music consumed last year.
In June this year, Apple launched the iTunes Store in 12 new Asian markets like Hong Kong, Singapore but India was left out from the list. And even though Apple is yet to launch its e-books (paid) in the Indian market, competition like Hungama, Flipkart’s digital store Flyte, Nokia Music Store, etc are bound to feel the heat. Apple’s launch, believe experts, will bring new visibility and emphasis to legal entertainment and multimedia content.
Devraj Sanyal, MD of Universal Music for India and SAARC termed it as a great news for the industry adding that it will help in curbing the piracy futher. “We believe that music should not be given free anyway. With iTunes, and other such services, users will be able to get legitimate music for very small price. We are also seeing a trend of people willing to pay for the downloads with more stringent norms against piracy.”
Even the film producers have a reason to rejoice, as iTunes gives them another way to monetise their library. “The prices for film downloads may not be very high, but its better than consumers downloading pirated low-quality versions. Once the consumers get the experience, they will start downloading more. It is just a matter of mindset, which is changing. And we also get a legitimate share per download. So its a win win for us too,” a senior executive from a film studio said.
According to a report by Deloitte, piracy in the form of physical CD sale and online download is estimated to be around 40 per cent to 50 per cent of the Indian film trade and industry loses Rs 300 to Rs 400 crore a year due to piracy. “Often pirated DVDs are seen much before film prints. India is among the top five countries in terms of piracy. Steps taken to curb piracy include setting up of formal alliances and associations such as Motion Pictures Distributor’s Association of India, Alliance Against Copyright Theft (AACT),” cites the report.
Meanwhile, Rivals like Hungama, which has over 2.5 million pieces of content in the form of music tracks, movies, music videos & dialogues, too have revamped their website and now allows users to stream free as well as buy Indian and International content like music tracks, music videos and stream full length movies. Siddhartha Roy, COO, Consumer Business & Allied Services, Hungama said, “India is a mobile first market and our biggest differentiator is that Hungama.com is available seamlessly across mobile for the Indian consumer. Via our billing integration will all telecom operators, the Hungama.com service is available to a much larger audience.” Hungama has also introduced Hungama Music Cloud Service that allows users to store music virtually and access content via any connected device.
Apple’s local dilemmas
iTunes Store purchases require a valid credit card with a billing address in country and that possibly could be the only hitch for users. That’s where Nokia scores. The Finnish mobile vendor’s Music Store, with over 45 lakh DRM free songs, had recently announced operator billing service along with Vodafone. Nokia Music Store is the first music store in the country to offer integrated operator billing along with credit cards and voucher billing. Nokia Music Store claims that it clocks 1.4 million songs downloads a day. Downloads via Flyte too require users to have a credit card or electronically transfer money into a digital wallet.
Since its inception, Hungama.com claims that it has completed 75 million paid transactions across digital entertainment content in the form of music tracks, music videos, movie streaming etc.
However, on-demand streaming music player like Dhingana that has over 15-million active visitors and 5,00,000 songs, beg to differ on iTunes’ impact in India. “The way forward for music industry is streaming, and music services like Spotify, which are growing at much faster rates than download services have confirmed this,” points Snehal Shinde, co-founder and CEO, Dhingana. Although Shinde admits that Apple’s entry will help reduce piracy, raise consumer awareness about the need to listen to music legally and provide listeners one more avenue to download music legally. “However, streaming and downloads being two different markets, we do not feel it will affect us in any way,” he reasons.