KPMG: India's Music Business Should Double by 2019

Posted at April 28th, 2016 | by Shivani Goel | in

KPMG, one of the biggest professional service companies in the world, has formed a new report based on the Indian music business. According to the projections, India’s recorded music business should nearly double in the next 5 years and will be bringing in an annual income of around 19 Billion INR by 2019.

If India was at that level today, it would be within the Top 10 biggest music markets in the world ahead as opposed to it’s current 20th position. As of 2014‘s figures, our industry is valued at approximately 10 Billion INR.

Overall though, the numbers are not very positive on India as a legitimate music market. Download revenues have decreased about 25% and subscription streaming income has been almost cut in half. There is a lot of migration from paid platforms to free streaming services which have gone up in value over 100%.

 

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The KPMG analysis shows the cash bifurcation as: 55% from digital music (downloads and streaming), 20% from physical, 10% from public performance and 20% from TV and Radio (also presumably performance royalties, but split out). They acknowledge that 2014 was “a tough year for the music industry” in India due to a 30% decline in physical sales as well as caller ring back tones. Piracy is at it’s peak and apparently only 1%-2% of music is consumed legally. If even a small percentage of this activity can be curtailed in this super-populated country it would be optimistic news for out music business.

Devraj Sanyal Managing Director and CEO, Universal Music Group South Asia says, “The future of the music business is clearly moving towards streaming services. Players like Hungama, Gaana and Saavn – plus international platforms like Rdio and Guvera who are already here and the certain entry of the other big global players – will decide the quantum of the future freemium and paid user base of music listeners in our region.”

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Independent music artists still struggle to make a mark and compete with Bollywood music which captures 81% of the market, and piracy continues to plague the industry. To match the aforementioned projections, KPMG deduces that these key industry challenges will have to be straightened out.

“As more and more Indian users have begun paying for music consumption, and labels like T-series, Rajshri and Aditya Music have eased up their licensing policies, these issues are most likely to be addressed in future.”

Source: KPMG

 

Shivani Goel

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