Even as the availability of film music has been on the lower side during the Covid pandemic, music streaming apps have been able to clock strong growth numbers in terms of listenership.
The platforms now hope this listenership will get converted into a large paid subscriber base, along with enhanced advertising in terms of branded content.
The platforms were able to put together a good collection of podcasts and non-film music content last year, which helped them gain users.
According to Siddhartha Roy, COO, Hungama Digital Media, they witnessed a 31% increase in monthly users across Hungama Network and a 21% growth in time spent. âOverall it's been an interesting growth. If you are aware in terms of creation of content, Hindi non-film music and regional content has been driving that consumption.â
However, Roy said the lack of non-film music on these platforms had an impact on audio players. He said while 90-95% of all music content on players is the same, in India songs are released to drive the audience towards a movie release. But if no movies are released, then why would anyone put out new music.
âIf this property comes back, it will have an impact on the growth. Our consumptions have now stabilised. After the Covid situation happened, two changes happened. Content stopped coming and that led to a certain amount of fall. However, the bigger fall was when the lockdown happened. The consumer habits changed.âÂ Â
âIt's not that massive de-growth happened. There has been progressive growth also but it has largely been stable to organic growth,â he said.Â Â
Citing similar sentiments, Ashish Pherwani, Partner and Media & Entertainment Leader, EY India, said, âAudio streaming is largely based on film music. When those releases fell, streamingâs popularity stayed stagnant. Other types of music such as exercise, non-film music, devotional, relaxation, and podcasts gained popularity to fill the void. With the resumption of films, we should see growth continue in streaming.âÂ Â
Akshat Harbola, Head of Market Strategy & Operations, India, Spotify, said they did see an initial slump in listener activity as people adjusted to the new WFH situation but streaming has now recovered to pre-Covid levels.
On Spotify, audio streaming continues to grow steadily. He said as people spent time at home last year and continue to do so this year, the preference for audio streaming has grown as a means to take a break from screens. Listeners also consider it to be a deeply personal experience based on curation of content, in-app features as well as algorithmic recommendations. âEven more interesting is the fact that more listeners have moved from the free tier to becoming paid subscribers, compared to previous years.âÂ
âWe've been in India for a little over two years, and the future looks very promising. We are here for the long term. While there is a change in the routines of our listeners and the way content is consumed, we will continue to evolve our experience for our users in the market. Spotify created an âAt Homeâ hub with playlists that cater to the routines weâve had since last year. We launched the mobile app in 12 new Indian languages so that more people can use the platform without any language barrier. We increased our original and exclusive content across languages and genres and revamped the desktop/web player as many listeners now access Spotify from their laptops.âÂ
âWhile we donât break down revenues by market, our earnings reports from the past few quarters will show you that India has been an important part of Spotifyâs growth journey. We will continue to strengthen our local team, product for the market, curation and discovery of local artists and creators, and tools for the creative community. This ties back to our audio-first strategy, wherein both music and podcasts, supported by intuitive technology, will keep the momentum strong this year and beyond,â Harbola said.Â
Is this translating into revenue for platforms?
While advertising sentiment was hit across mediums in 2020, what does the spike in Covid cases in 2021 mean for audio players? According to Roy, a lot of brands returned in the second half of 2020, and categories such as FMCG, healthcare, consumer durables, and e-commerce were investing aggressively.
Talking about the impact of the second wave, Roy said we will have to wait and see how the situation unfolds.Â
âWe have to wait and watch because consumers are not necessarily consuming less. Consumption continues to grow. The question is will brands have the ability to use these communities to drive their engagement and their consumption experiences.Â I believe this time around, it's going to happen in pockets. It's not that this is going to be generic for the whole of advertising, because people changed the product and distribution mixes during the Covid pandemic. There's a lot that's happening digitally and because we've got digitally classified consumers, we become an ideal place for the brand to interact because that has a call to action that leads to some form of commerce. In totality, I believe Covid will obviously have an impact but it will happen in pockets and will be temporary.âÂ
Harbola said while there was a slight bump in the advertising business across the world early last year when the pandemic hit, business soon recovered to pre-Covid levels and even grew from thereon.Â
âMany brands work with us for the âstreaming intelligenceâ we provide, which is based on billions of data points that allow Spotify to understand the person behind the device, including their contextual behaviour such as moods, tastes and habits. It offers brands data on actual ad impressions, frequency, reach, and anonymised audience insights (age, gender, device type). Currently, we are working with over 100 brands in India, including media and entertainment companies, especially OTT players, tech players, FMCG and consumer product companies and automobile firms among others,â said Harbola.Â Â
As people grow more and more vigilant about the second wave and the pandemic already affecting peopleâs spending habits and incomes, can this affect the SVOD revenues for platforms? According to experts, the sentiment behind spending on music online is changing slowly in the country. âWhile India has predominantly been a free music market where listeners havenât paid for music (especially online), the general sentiment is changing. In fact, on Spotify, the premium/subscriber business has grown faster than the free tier in the last year or so. Thatâs a clear indicator that if listeners find value in the content, curation, and product experience, they will show a willingness to pay,â said Harbola.Â
âWe understand the challenges of payment in India and so Spotify has several premium plans for the market. Whether you're a student, an individual, a couple, or a family, you can opt from our multiple subscription plans ranging from daily and weekly to monthly and annual. And finally, we are partnering with local brands to be where our consumers are, and integrate Spotify into their daily experiences. We will continue to localise our strategy for India through content, subscription plans, and commercial partnerships,â he said.Â
According to Roy, players must focus on how much people are ready to pay. âI think the consumers are willing to pay but the question is what are they going to pay? Or how much are they going to pay? That's the larger price discovery that's happening in the ecosystem. All of us are driving growth in interest. We are offering various kinds of promotions, packaging and deals to drive consumption. It's all about giving the consumer a tipping point when he moves from free to paid and there is a reason that he does it.âÂ
âWe need to basically accentuate that and be able to play an important role for that habit change to happen. Is India going to be a large subscription market? I guess definitely. India is going to be one of the largest markets in the subscription space. The question is when and how and how each of us as platforms is telling our own story.â
Another platform said the largest number of subscriptions for them is annual. âThe consumer is paying for 12 months in one go. Some feel it is not a paying market but people are actually paying. Looking at video, India has already become a large video subscription market.Â Yes, the yield may be low. But the ability to grow is there.â
Speaking about their plans for recovery in 2021, Roy said they will continue to build on regional markets. He said they will launch 30+ podcasts in different languages and genres. They are bringing all the matrices available for brands to measure the Hungama consumer community. âTill the time our communities are driving the core KPIs for the brand, I believe there is a story to tell. The kind of content consumption and content-rich data we have itself fuels a better quality of consumer profiling,â he said.
âWe're obviously focusing a lot in our tech where we're bringing in better differentiators, better personalisation and better localisation for the content experience and the Hungama music experience to the user. For this, we have partnered with Dolby Atmos music. In this part of the world, Dolby Atmos music service is available with Hungama. Lastly, we continue to build on our loyalty programme. We've had some great successes over the years where we have got a lot of consumers earning rewards, and then being able to burn rewards and sustain merchandise and products. We continue to leverage this in this year.âÂ