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Spotify just knocked in India’s fast-growing market
Now Spotify has got 1 million users in India including both free and paid Premium accounts, as a representative for the company confirmed Six days ago the streaming platform silently arrived in India amid a legal skirmish over whether the launch would consist of the catalogue from Warner Musics publishing arm
HIGHLIGHTS
- Spotify hits 1 million subscribers in India
- Spotify’s 1 million-user milestone represents a small fraction of Indian streaming market
- Spotify is slightly undercutting Apple by offering its subscription for 119 rupees
Now Spotify has got 1 million users in India including both free and paid Premium accounts, as a representative for the company confirmed. Six days ago the streaming platform silently arrived in India amid a legal skirmish over whether the launch would consist of the catalogue from Warner Music’s publishing arm.
Usually, Spotify doesn’t release these kinds of early metrics, so it’s not possible to say how this 1 million-user milestone loads up in comparison to other territory launches. But, that number can be looked at in the grander context of the Indian streaming music market.
The total population of India’s is 1.34 billion, but only about 150 million, or about 11 per cent, subscribe to a music streaming service, as per a report by Deloitte and Indian music-industry body IMI published earlier this year. Of this 150 million, less than one per cent of subscribers pay for a subscription and about 14 per cent have a packaged subscription like Amazon Prime, or through a mobile contract. The remaining 85 per cent of the population stream music with free subscriptions. Whereas 1 million is a large number, Spotify is reaching less than one per cent of the Indian music streaming population, and it has probably signed up few paid subscribers.
The minority that does pay for music services in India don’t pay much. For example, an Apple Music subscription in India will cost around 120 rupees, or $1.69, when compared to $9.99 per month in the United States. Spotify is leaving behind Apple by slightly charging lesser than what Apple is offering in its subscription for 119 rupees, or about $1.67, along with flexible pre-paid plans that range from a single-day pass to six months of access.
While keeping this all aside, India is considered to be music’s “sleeping giant,” with the world’s second-largest smartphone market and reducing data rates that see millions of new people sign up for online services every month. Recently the CEO of Gaana, Prashan Agarwal said Quartz he expected the industry to grow to almost 400 million consumers within the next two to three years. This is unlikely to be tied up with a similar surge in revenue. The existing gap between music streaming and value in India is so huge that companies should expect to continue to rely on ads and telecom subsidies as primary sources of revenue.
How Spotify grows in India past the launch frenzy will be telling. Its entry, in general, is late to the game, and it faces rigid competition from the likes of Apple Music, Amazon, and Google Play, alongside local services like JioSaavan and Gaana, which dominates with about 80 million users, which is about half of India’s active music streaming market. It’s also difficult to tell how much the tracks missing from Warner/Chappell Music have impacted the number of people who have signed up for Spotify in India. According to a Nielsen report, the top genre consumed in India is Bollywood, followed by other ‘Indian film music’ then the Indian pop and next comes the Indian regional folk and Western pop stand in the fifth position.
Currently, Spotify is in a row with Warner over renegotiations for its global deal, which is preventing music from Warner’s publishing catalogue from appearing on Spotify in India. Barry McCarthy, Spotify’s chief financial officer, admitted as much in an interview last week. “It’s not really about India,” McCarthy at a Morgan Stanley conference told on stage. “It’s about leverage and renegotiation of the global agreement.”
A according to Spotify the fight began when Warner, “revoked a previously agreed-upon publishing license for reasons wholly unrelated to Spotify’s launch in India.” Spotify then tried to avoid a direct deal with Warner by using a controversial amendment in Indian law, which says “broadcasters” can obtain a license for copyrighted works even if the copyright owner denies use. Warner then issued an injunction, which led Spotify to launch in India without the catalogue from Warner/Chappell Music, the publishing side of Warner Music.
