As Internet penetration in India is growing at a rapid speed, Consuming music and audio content methods have changed drastically. It is surprising how deeply technological progress has influenced the (digital) music market.
Music Streaming industry revenue touches US$244m in 2020 and is expected to show an annual growth rate (CAGR 2020–2024) of 8.3%, resulting in a market volume of US$334m by 2024.
The changed era of cassettes to CD’s, MP3 to online music download to music streaming. Listening to music has gone through several different phases.
Music Streaming platforms offer unlimited access to their music libraries for a monthly subscription fee (without any advertising) Later, introduced premium plans for users who are comfortable in paying money to get rid of advertisements and unlock additional features like offline mode.
At present, the Indian market is dominated by Times Internet-owned Gaana, JioSaavn, Apple Music, YouTube Music, and Sweden-based Spotify.
When any new technology arrives in the market, people embrace it at different levels, based on their personality traits. Some individuals are inevitably more open to adaptation than others. This idea was proposed by Rogers, through
According to Rogers, not everyone has the same motivation for adopting a new idea. He identifies the following five types of adopters:
- Innovators adopt something simply because it is new. They love exploring for the sake of exploring and are willing to take risks, even if those risks result in failure.
- Early adopters are often opinion leaders. They are similar to innovators in how quickly they adapt, but they are more concerned about the coolness factor and maintaining their reputations as being ahead of the curve on new ideas.
- The early majority and the late majority are the critical mass that ensures adoption. The early majority looks for productivity and practical benefits more than coolness or reputation. The late majority is similar but also expects a lot of help and support before they are willing to commit.
- Laggards, as the term implies, are slow to adopt. They are the most resistant to change and do so only when forced to adopt because everyone else has.
Factors and challenges which affected the rate of music streaming service adoption
Price Factor Paying for the subscription is a challenge when people are accustomed to listening to music at no cost all these years. However, even with the cost slashed down, conversion remains less. If we glance over at India, only 1% of all streaming users pay for premium subscriptions directly.
Internet speed is a challenge for the people who live in Tier 2 and Tier 3 cities. With the Digital India campaign Government of India is constantly working towards improved online infrastructure and by increasing Internet connectivity or making the country digitally empowered in the field of technology. An annual rise of 18% growth in access to internet connectivity, reaching around 627 million highly influencing people to have access to music streaming apps. Players like Jio changed how access to the internet can be extremely cheap for the next billion users
Apart from the internet service provider themselves, the speed of connectivity is a major influence on music streaming apps
Competitors If the subscription price is slashed down among the existing competitors it will be really challenging to find a loyal customer base.
Streaming Alternatives According to Nielson, 94% of the online consumers in India listen to music and 71% of them say that music is an important (or very important) part of their lives. Still, the country has a base of 26% users to the streaming platforms. The point is streaming services are just one of the consumption channels available to the Indian consumer and not necessarily the most attractive option.
Piracy When it comes to off-screen consumption, the biggest streaming alternative is pirated services. According to the latest surveys, 76% of internet users admit using pirated content in the last three months.
“To sum up, the Indian market is well-positioned to grow the streaming user-base in the coming years. India’s streaming music market is now 200 million strong — but hardly anyone’s paying for it”
The numbers indicate that India‘s music-loving junta, which consumes Bollywood (Hindi cinema) and regional cinema music primarily, prefer ad-supported free music service, instead of premium quality streaming or extra features.
India’s current $200 million music-streaming industry is estimated to touch $400 million by 2023 but it won’t be a one-player game.
Music streaming Platform
Most of these apps are in land-grab mode. Right now, their focus is to increase their monthly userbase — then they’ll concentrate on getting subscription numbers up. Apart from that, there are two main reasons why not many people have migrated to the paid model: lack of credit card penetration and slower-than-anticipated migration from pirated apps or services to the legit ones.
Wynk, JioSaavn, Hungama, Apple Music, Google Music, Amazon Music, Spotify, Youtube Music are a few of the major names in the Indian Music Industry.
Subscription service plans — Music Streaming partners
- Wynk — ₹99/month
- JioSaavn ₹99/month
- Gaana — ₹99/month,
- Apple Music — ₹120/month
- Google Music- ₹99/month
- Hungama- ₹99/month
- Amazon Music ₹129/month
- Spotify — ₹119/month
- YouTube Music — ₹99/month.
Growth hacks for faster adoption
1. As of today, the most prominent solution to monetizing streaming services are bundled telecom offers. The concept is easy, the premium subscription is offered as a “free” bonus on top of the mobile data plan. That works on two levels. First of all, it allows attracting new paying users into the streaming ecosystem, by selling them a service on a “feels like free” basis. Secondly, streaming subscriptions synergize nicely with the telecom services, since access to the premium raises user’s data consumption
2. Providing access to regional music primarily targets listeners who only listen and understand their language. This is a great hack for adopting the rural population of India as well as market segments for the age groups of greater than 40.
3. Podcasts are another way to make users shift who listen to audiobooks or regular podcasts on a dedicated app like audible or apple podcasts to apps like Spotify.
4. Music streaming apps also provide insights to artists and a profile of their listeners — as well as providing a medium to sell their merchandise and events tickets via the app.
5. Sponsoring concerts or music festivals could give them great traction to grow into Indian markets.
6. Music streaming apps could partner with specific music labels and distributors in order to bring artists signed with them on to the platform thereby increasing the number of listeners based on their fan base
7. From a behavioral perspective, India is not a recommendation-oriented streaming market, but rather relies more on search and discovery, particularly around popular Bollywood actors and music directors. Hence, one of the most important features for successful streaming services to include is a cross-media search.
The first job is to engage directly with the new listeners through access models and cheaper plans, but once the customers are acquired into the free world, companies need to think more seriously about how to up-sell the subscriptions.
With the telecom infrastructure reaching the foremost remote parts of the country, cheap data plans and governmental support are the only options. There is no reason for the current digitization trend to slow down. And if it persists India will reach the 80% penetration figures very soon. It means that within the next few years the addressable audience of streaming will double.