BookMyShow, which sells movies, concert, and events tickets online among others, launched a free music streaming service in September this year. Through its Jukebox, app users can stream free music and talk shows. Business Today recently caught up with Aditya Kuber, the company's AVP of Audio Entertainment. Why did the company enter a space already crowded with players such as Saavn, Gaana, Hungama, Wynk, Apple Music, Google Play Music, and possibly Amazon, which could launch a music service for Prime members soon? Here's what we found.
1. The Indian music industry is shifting to digital consumption because of cheaper data rates and growing smart phone usage. The KPMG India - FICCI media and entertainment (M&E) report of 2017 stated that in 2016, the Indian music industry clocked INR12.2 billion in revenues and it could grow to INR 25.4 billion by 2021, a CAGR of 15.8 per cent. "Digital music currently generates an estimated revenue of over 70 per cent of the overall size of the music industry while synchronisation, performance rights and physical channels contributing the remaining share". The report also mentioned that 2016 saw "a spike in the music streaming volume with around 50-60 million active monthly users on music streaming applications".
2. BookMyShow has a captive user base - according to the company, it has over 25 million users, a majority of whom search for and buy movie tickets. Over 75 per cent of its business transactions are driven by movies. It sells more than 10 million movie tickets a month. One-third of the tickets PVR sells are through BookMyShow. A music streaming service could substantially boost the time users spend on the app - a key metric watched by investors today. Kuber says 30 minutes could be the average a user would spend listening to a music streaming app. Their talk shows can be an hour long.
3. The company wouldn't say it but a music streaming service is one way to future-proof the company against emerging competition such as Paytm. Sales of movie tickets through Paytm spiked post demonitization.
4. It is a difficult market to differentiate considering that every streaming app is exposed to similar labels. BookMyShow thinks it can differentiate because of its talk shows - sort of podcasts ranging from news packages and sports shows to horror and comedy. The company is also producing original content; there are 25 original shows right now on the platform.
5. Companies have struggled to monetise digital music. Piracy has been a bane. BookMyShow's monetisation would hinge on advertisements. A free service could be the right carrot for more people to get hooked to streaming.