Why closing of Flyte by Flipkart is many steps backward for music industry

It’s only last year that Flyte, music library akin to iTunes was launched in India. Few , very few people was actually interested in news about buying music legally. Rest all continued with piracy route.

And it’s no wonder within a year , the service is closed since there is no traction from buyers to this new concept of paying for music. Digging deep into this , it is alleged that there is a minimum guarantee money that needs to be paid to music label irrespective of whether music is sold or not. And this amount seems to be higher than the income made by service and hence it was not profitable for Flyte to continue the service.

And some are not believing that to be the case and how better advertising could have helped the service gain more traction.

Music Industry is non-existent without movies

First , let us try to understand the music industry in India.Music industry is nothing more than  complimentary to movies made in India. Music industry as stand alone doesn’t even exist in India. Unlike Western countries where music industry is independent from Hollywood , in India is totally dependent.

Movies use music – songs and videos  as a way to market their movies. And movie industry is quite happy to keep it that way and songs getting played repeated in FM, TV Channels,Youtube and through few streaming sites for free like Saavn and Gaana. And then there is CD sales which is struggling to find relevance in this digital world.

In this current scenario , the only time a consumer cannot legally listen to music is when they are travelling and do not have unlimited data plans to stream music all the time. Why streaming music in India is not a viable proposition has been detailed here to great extent.

Music on the GO ..

So challenge is to sell music to users who has already plenty of options to listen to same music absolutely for free but with riders like advertisements inserted or not getting to listen to music on demand and wait for TV channels or FM stations to play music .

Finding the music that you love

1.Try to locate new music to download – it takes quite some time to find pirated music as many sites get closed often and you need to find new site. Sites like iTunes and Flyte provides a neat way to locate music and play it easily.

2.Managing it across devices. So at home , one want to play it from your laptop or through home theater connected to mobile or internet TV or listen to it while travelling around using mobile. So the music needs to be available and be in a device that is always connected. Stand alone USB or external disk will not help in listening to new music every day as and when it releases. So a tablet or mobile is perfectly suited for this.

3. Cost – this is where it gets tricky. People  need music when they are are on the go and there is nothing available free other than streaming sites with consumes data. Users can rely on FM to play songs that one wish to hear or travel without listening to music.

Question is about how much a user would be willing to pay for this little span of time when there is no option to get free music. Yes, am totally discounting people who do not have access to internet. Also the word piracy diminishes and make people less guilty because there is a host of free music already available that can be accessed when they have internet.So argument is that if i have unlimited 3g , im entitled to free music but when users don’t have it, i dont have an attractive option. Why this exclusivity ?

Music labels need to first concentrate on getting people to first embrace this one stop shop model for buying music. Cost should never be a deterrent for people who are coming with loads and loads of pirated music in hard drive collected over years.

I have spent around 600 Rs in flyte to buy music over a period 6 months. Average cost for song that is released newly is 15 Rs.Some people argue that is good price. But from user perspective, this mean a new album can cost 75 Rs and if they are ready to spend 200 Rs for a month  , they can buy around 3 albums at max.

Subscription Model for Downloading music

Above model does not entice people to get on boarded to paying for music – for some one who is listening to music for free all their life to get started. Money that needs to be paid for convenience of single point of purchase is not worthy of  the money spent.So they continue to indulge in piracy.

Now bring in an option like this : Pay 200 Rs per month on a subscription basis and let users download 100 songs maximum as free beyond which nominal rates will apply. Options like this can change entire equation. So it means 2 Rs per sound and they can download 12-15 new albums every month.

This model can pave for music by new artist to get noticed and be enjoyed . This low pricing will act as a music discovery service and can be big boon to artist and music labels alike . The limited scope to which Indian music is subjected to will expand significantly and can lead to a new music revolution.

Similar pricing in streaming music is being tried out by Saavn with a hybrid offline option which is not very clear as to how it works out. Anyways streaming service domination is dependent on telecom operators and it cannot be relied in entirety.

Of course this can severely put pressure on music labels and there can be huge pricing mismatch between CD pricing and digital music. But it is given that people who buy CD do it as a hobby or passion for music. They do not mind the price of CD vs price of digital music and consider it as a collectors item.

Bundle value add features 

So an exciting entry point , very low cost is what makes people get started on buying music. This strategy cannot help music labels to even break even but then what other option to they even have? Music labels can think about integrating the caller tune service provided by telecom operators into digital music. Buy music here and get the same song set as caller tune can be interesting value proposition to consumers. Musicians in India are paid not by music labels but movie producers and hence they should not be impacted by this.

Flyte pricing has led to it’s poor traction and closure. Now people who paid for music or now left without any option but to move back to pirated music.It’s high time that music label realize this and price music atrociously cheap so that people first get boarded on listening to music legally.

India is one of countries where smartphones are sold at record pace. And the young school going kids of today has to be constantly fed with the fact that music is easy available and all that it takes is few hundreds of their pocket money monthly to listen to them.Sadly other than iTunes which targets premium users, there is no single alternative that is not yet popular in India. And this is a bad news for music labels and not for customers .

Longer the music labels realize this fact , more and more generations will continue with piracy. It is not about what price music labels can work with for them to break even or get profit but about what price consumers are willing to pay for something which is otherwise freely available when they are connected to internet.

Will they wake up and smell coffee ?


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