India’s evolving popular music landscape

September 2010

Music producer, Atul Churamani, Vice President of Saregama India Limited, has been a driving force in developing the popular music market in India. This profile by Michael, P. Ryan, PhD, Director of the Creative and Innovative Economy Center of the George Washington University Law School, offers some interesting insights into the challenges associated with the evolving commercial landscape for popular music in India.

Atul Churamani is one of India’s foremost popular-music innovators. In the 1980s, he helped international music sales take off in India by synchronizing the Indian release of albums by artists such as Michael Jackson and Madonna with their international release and by distributing them on high-quality, attractively packaged cassettes. With the arrival of MTV1 in India in the 1990s, he created Indian music videos for the channel and established the Indian pop-music marketplace. In 2005, his King Khan compilation album of Indian music remained in the German charts for 12 weeks and broke into the top 20 list of hits. That same year, the American band Black Eyed Peas adapted music by one of his songwriters to produce “Don’t Phunk with my Heart.” It became the most popular song in the world for that year. Mr. Churamani wants the world to listen to Indian music and he wants mobile phone makers and other businesses to be his distributors. He is one of India’s B2B2 music innovators.

Making and selling music has never been more challenging. As Mr. Churamani notes, “When I got into the business it was about selling recordings in particular formats. Who now cares about CDs? I sell our music on cell phones. But, it’s not a catalog deal,” he continued, “it’s an exclusive deal – my best new music and artists are available only on one brand of cell phone. Now, we have a million sellers, again.”

(Photo: Atul Churamani)

For a long time Mr. Churamani was an “A and R guy” in the music business that is, his job centered on selling the artist and the repertoire to consumers on physical formats like vinyl records, music cassettes and compact discs. “But,” he notes, “my job has evolved to become very different now. I am bullish about artist concerts and events that sell our artists to consumers, but otherwise the B2C3 model no longer works. We in the music business are now in the B2B model.”

An economics graduate from Delhi University, Mr. Churamani was initially a journalist, writing about sports, film and music for the Weekly Sun, a New Delhi-based youth magazine. But, he soon became more interested in getting involved in the business of music rather than merely writing about it, so in 1987 he joined Mumbai-based CBS Gramophone Records and Tapes India Ltd.

Having had a taste of life with an international record label, he went on to join a start-up that had acquired the Warner Music license for India to become one of a team of five at Magnasound India Pvt. Ltd founded by Shashi Gopal in 1988.

Innovator of the Indian music marketplace

Magnasound revolutionized the Indian market for Western music. “There were two basic problems in the Indian music marketplace: first, not just Indian music, but even international music was sold on poor-quality cassettes; second, music from Britain and the U.S. was released months after it was released in their home markets. By then the pirates had already saturated the market. We changed that,” Mr. Churamani explains.

As the exclusive Indian licensee for Warner Music (then called WEA International), Magnasound’s strategy was to release international music to the Indian market at the same time as it was released internationally and to distribute it on high-quality and attractively packaged cassettes at premium prices. This innovative business model paid dividends, for example, making Tracy Chapman’s debut album a huge hit in India. The Indian market for legitimate international music rose dramatically.

In 1991, the News Corporation Star Network introduced MTV to the Indian marketplace. MTV had plenty of music videos featuring U.S. and British performers, but none presenting Indian performers. “At the time,” Mr. Churamani explains, “70 percent of the music marketplace was film music. The Indian music market is still tied closely to Bollywood, for that matter. So, the opportunity was there to make Indian music videos, but that was only the beginning.”

The following year Magnasound produced two music videos. “We did one video for Jasmine Bharucha, an Indian girl singing in English and a second one for India’s first rap act in Hindi, a guy called Baba Sehgal. The videos were hits and Baba’s album Thanda Thanda Pani, became a 750,000 seller because of the video. It was unprecedented; no Indian pop album had ever sold so many copies. We created the Indian pop music marketplace because of MTV and Channel V, the Star network’s equivalent to MTV.”

Mr. Churamani explains, “we introduced completely new sounds to Indian music. Cool grooves, fresh voices. We found good-looking young artists. Then we produced the music to Western music standards and sold it on high-quality cassettes in great packaging. Our album Made in India outsold the top-selling Bollywood film soundtrack of the time! We sold 2.5 million copies of the album. That number was unheard of in Indian music – legitimate cassette sales, anyway.” A string of Indian pop music hits and stars followed and the pop music industry grew to occupy a significant segment of the music marketplace.

This success, however, was cut short by the fact that “the film industry took our music stars, the composers, producers, arrangers, lyricists and singers. Soon Bollywood film music began sounding like and, in fact, sounded better than the pop music being created. And so the recorded pop music business perished,” Mr. Churamani explained. “Interestingly though, the singer loses out to the actor in the film who is seen on the screen singing the song. That is the power of Bollywood. So, we had to do something new with our artists to make them stars.”

Mr. Churamani continued, “we focused on concerts, on live stage performances. We started by managing a couple of artists like Shaan and Shubha Mudgal, which helped us build profiles for the artists as well as earn revenues for the company at a time when physical sales were beginning to decline. The fact that concert earnings are a far greater revenue earner than CD sales wasn’t news but as music companies we had never bothered with that part of the business. One of Magnasound’s biggest stars, Daler Mehndi, earned a pittance in music royalties compared to his show income but Magnasound never got a share of that revenue stream,” he explained.

B2B Indian music marketplace innovator

In 2002, after a stint with Virgin Records, Mr. Churamani joined Kolkata-based Saregama India Limited, founded by EMI music in 1901. With offices around India as well as in London, New York, and Kuala Lumpur, he began establishing a global network of sub-publishers to work with the company’s rich and extensive catalogue. He was convinced that the world was ready to enjoy Indian music as never before. Today the company is publishing across all continents, reaching out to Western audiences through its licensing, sampling and publishing deals.

When commenting on the future of the music industry in India, Mr. Churamani remarked,
“We must do 360-degree deals now. The business is about exploitation of the music in various ways… now music companies must look at making revenues from television, radio, and music publishing. That is why we sign the artist as a performing artist for concerts.”

Sonu Niigaam performs with the City
of Birmingham Symphony Orchestra
(Photo: Saregama India Limited)

Having set up Saregama’s digital business in both the Indian and overseas markets, this dynamic entrepreneur is looking for additional opportunities for monetizing the company’s music assets.

Mr. Churamani explains, “Though we have a good Copyright Act, enforcement is an issue. People don’t pay for usage of music. And today, this loss of revenue really hurts. So we have to stand up for our rights and file copyright lawsuits against hotels and radio for not paying for our music. But you can’t live your life filing lawsuits against everybody,” he said. “In addition, technology has changed the way people consume music and you can’t fight technology. The worrying part is that there are too many people using music for free and, even when it is paid for, the music value chain has been lost. All along the chain there isn’t enough money for people to make a living off music.”

In spite of these challenges, Mr. Churamani is optimistic about the future of music in India and around the world. “It’s a question of seeing the opportunities for sustained growth. Look at the number of mobile phone subscribers in India and the growth of those numbers by an astounding 12 million a month. Today, every handset is being advertized as a music player. So there’s an obvious answer to the issue of not selling CDs in large quantities anymore.”

He believes that mobile phone companies can personalize their music offerings to make handsets more attractive to consumers, “It’s all about exclusivity,” he said. “We recently had an album called Time Travel by one of our biggest acts, Sonu Niigaam, embedded on the Nokia 5130 model as an exclusive deal, before the release of his album on CD. It looks like we have entered the era of the million-seller once again,” he beams. “I’m really keen to do more like this with the mobile. I can sense huge numbers in the offing.” He expressed his doubts about the ultimate viability of the subscription model that some think is the next big thing. “Nobody listens to millions of songs; I don’t think people will pay to get access to a million songs that they don’t listen to.”

Mr. Churamani is keen for Indian music to cross-over to other cultures in other countries rather than merely be sold in the Indian diaspora. In 2008, Saregama teamed Sonu Niigaam with the City of Birmingham Symphony Orchestra for a series of three concerts in the U.K. They sold out weeks in advance. As the broadcasting rights were licensed to Sony TV, the performances were watched around the world. The overwhelming success of these concerts prompted them to organize a four-concert tour of the U.K. with the same orchestra called “Remembering Nusrat.” This too was a sell-out.

Given its success in the U.K., Mr. Churamani is eager to extend this collaborative strategy globally. Pointing to the Oscars and Grammy Awards won by A.R. Rahman for best musical score for Slumdog Millionaire, he concludes, “we are now finding the right canvas for Bollywood music to go global – and for Indian music in general to appeal to the sensibilities of the Western ear.”

1  MTV - an American network based in New York launched in August 1981. The original purpose of the channel was to play music guided by on-air hosts known as VJs (video jockeys).
2  B2B – business-to-business
3  B2C – business-to-consumer

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