While the internet is frequently associated with George Orwell’s 1984 dystopian novel, a better association might be with William Shakespeare’s “everyone’s a stage” phrase from As You Like It. The expression is representative of the creative sector on the Internet today, more so of the global music industry.
Technology has democratized the music industry globally. Easy access via smartphones allowed people around the world to listen to new releases and songs at the same time. Ad-supported streaming services allow listeners from Brooklyn to Birmingham and Bhopal to Brisbane to play the same song for free. Music today truly knows no boundaries between languages and new genres strike a chord across nationalities. The success of songs such as Puerto Rican singer Luis Fonsi’s “Despacito” and Nigerian artist Ckay’s “Love Nwantiti” – which topped the international IMI charts in India for several weeks last year – testify to the reach streaming services. K-Pop is now a multi-billion dollar company and is listed on the NYSE. Congratulatory messages to K-Pop group BTS on their ninth birthday on June 13 are just another indicator of the popularity of this music genre.
Indian music is also experiencing a democratization, although to a much lesser extent. “Why This Kolaveri Di” in Tamil, “52 Gaj Ka Daman”, a Haryanvi track, and Shershaah’s Punjabi soundtrack have all crossed 1 billion music streams.
Globally, more than eight billion dollars have changed hands due to mergers and acquisitions in the music industry since 2020. However, the Indian music ecosystem has seen a trickle of global investments. Unlike “Despacito”, K-Pop and “Love Nwantiti”, Indian music has not reached global heights and is almost non-existent on the world stage or on international charts.
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Despite a rich talent pool, outdated laws imposing legal licenses for radio and television broadcasts – there is also the threat that such licenses will be extended to internet services – have created an atmosphere of uncertainty. Ambiguity in the records of copyright societies – associations formed of authors and other owners of original works that have the power to grant copyright licenses – and confusion in the rules relating to royalty collecting societies are great obstacles. The misuse of safe harbor provisions also erodes value for all stakeholders in the music industry.
All of this hampers the investment plans of record companies who prefer to stick to genres that work – movie soundtracks, for example – leaving no money for talent development in new genres or deeper investments. in traditional genres. It also deters new players willing to enter the Indian market. Copyright reforms could create a climate that encourages strong investment in all genres of music across the country. With 26 languages and 20,000 dialects, it’s not at all difficult for the next “Despacito”, “Gangnam Style” or a group like BTS to originate in India.
Let’s take a step aside to examine the reason for the introduction of statutory licenses in 2010: to support a nascent private radio industry. However, in 2019, radio was Rs 3,500 crore and recorded music an industry of Rs 1,200 crore. Here, David feeds Goliath. Moreover, streaming services, given their high valuations, do not need financial support through legal licenses.
The music industry parallels the pharmaceutical industry, the start-up sector and portfolio management services. According to the IFPI, $5.8 billion is spent worldwide each year on creating new music and discovering new talent, which is akin to the pharmaceutical invention of new blockbuster drugs. Similarly, significant investments will be needed to discover new genres and talents across languages in the Indian music space. In the traditional and regional Indian space, returns on investment are meager due to low ad spend and subscriptions. Consequently, even the most enterprising record labels or enthusiastic investors have no incentive to invest in regional and traditional music markets.
Telecommunications Minister Ashwini Vaishnaw has spoken of putting India on par with China and South Korea, which boast a robust 5G network. He spoke of an ecosystem in which telecom operators themselves would be free to set prices based on their understanding of consumers. We hope for a similar vision regarding copyright licensing for the music industry.
The creative community benefits the most when there are benefits to be shared. A vibrant music ecosystem will bring new investments at all levels, from new genres to concert halls. I-Pop could enable job creation and create on-demand economy opportunities. And, of course, soft power is priceless currency.
The writer is chairman and CEO of the Indian music industry