Music streaming services in India — The turning point is here.
The music streaming industry in India has come a long way since its infancy in the 2000s. It had a history beset with piracy problems, licensing issues and slow growth due to low internet penetration in India until the last decade.
The initial set of basic music streaming services mainly consisted of internet radio playing 24/7 Bollywood music. Then came full-fledged on-demand Indian music streaming services like Hungama, Gaana and Saavn by 2010. These had a wide repertoire of Indian music in various local languages.
The music streaming scene then underwent a sort of revolution with the advent of cheap smartphones and 4G mobile data services by 2015. Finally, the influx of global players with huge libraries such as Apple Music, Google Play, Amazon Prime, Spotify and Youtube Music have cemented India’s position as a hot market for on-demand music streaming services.
Product adoption curve and personas of users
The Indian music streaming market has now reached a level of maturation where most established players have crossed “the chasm” in the product adoption curve, which in product management parlance means a crossover zone from an early stage, failure-prone product and to a successful one. Thus, the overall propensity to fail is quite low but the new players still have to conquer the early market.
Innovators: The first set of people to use your product. They usually include open beta testers, tech reviewers and internet enthusiasts who keep a tab on the music space and are the first ones to test new products.
Early Adopters: These are usually audiophiles and music aficionados who are passionate about music streaming in general and wish to experience any new product that launches in this sector. These users are typically younger in age, have a higher social status, have more financial ability, advanced education, and are more socially forward.
Early Majority: These are users who usually look for tried and tested options with proven value. They are influenced by the blogs and reviews posted by the Innovators & Early Adopters. They are mostly tech-savvy millennials who own smartphones and audio gadgets, wouldn’t mind paying a subscription fee and have a penchant for the latest global music trends. They form a significant chunk of the user base.
Late Majority: These are people with a high degree of skepticism and who wait until a majority of society has adopted the product. They need more convincing than just good reviews of a new product. They won’t easily adopt a new product until they have a real need for it or there are no other alternatives and are convinced it’s of great value.
Laggards: These are people who are are typically averse to change and are the last ones to adopt a product. They are mostly advanced in age, stick to old technology and traditions or have low social status and financial fluidity.
Streaming music scene in the overall recording industry
Indian consumers spend nearly 21.5 hours a week listening to music, compared with the global average of 17.8 hours, according to a report by Deloitte and the Indian Music Industry (IMI). The report also mentions revenues from digital consumption contributes nearly 78 percent while physical sales accounted for only 7 percent out of the overall music revenue of INR 850 crore. About 75 percent of smartphone users listen to music on their phones, 86 percent of which use on-demand streaming. All these factors coupled with cheap smartphones and even cheaper data rates makes it an enormously compelling market for all the global streaming giants to step in. In fact, the Indian music streaming market is already among the top 20 in the world.
Factors affecting the rate of product adoption
A factor improving the rate of product adoption is personalization of music based on listeners' preferences and past listening history. Streaming music services like Apple, Spotify and Youtube provide personalized playlists and music recommendations based on machine learning as their biggest product differentiators. The availability of localized content based on folk music, local films and regional languages is another significant driver of growth.
The main challenges affecting the rate of product adoption are piracy in the form of stream ripping and free downloads, licensing issues with record companies leading to smaller song libraries, price-sensitive Indian users who might not be ready for premium paid subscriptions, poor network coverage and persistently slow mobile data connections.
Growth Hacks
The freemium, ad-supported models used by JioSaavn, Gaana, Spotify and Youtube Music alleviate to a large extent the hesitation of price-sensitive Indian users towards paid subscriptions. The value proposition of listening to any song on-demand for free has proved irresistible.
After a trial period, many users do get enticed into signing up for premium features like higher quality ad-free music, unlimited skips, non-shuffled play and offline listening. Also, these hacks help in combating piracy as users get free access to huge music libraries in a hassle-free way.
The close integration of Spotify with social media like Facebook and Tinder satisfied users’ tendency to share what they listen and helped increase loyalty. Also, tie-ups with TV, car audio and speaker manufacturers have built a strong ecosystem.
To tackle spotty mobile data connections and less powerful budget smartphones, Spotify recently released a Lite version for emerging markets like India, Brazil and many others.
Conclusion
The music streaming market in India is booming and the entry of Spotify and Youtube Music recently has made it much more exciting. Whether the local players will survive depends on how much they’ll improve their products in terms of user experience, library size, smart use of AI for recommendations and building loyalty through great value and partnerships.
Sources:
https://www.statista.com/outlook/209/119/music-streaming/india
