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Indian music industry report takes aim at safe harbours

Complaints about the music industry suffering from a ‘value gap’ are far from just a western affair. Indian music industry body IMI has published a report exploring why the film industry in India has grown so much bigger than the music business, despite their close links.

With IMI estimating that 70% of recorded music in India is film-based, it’s a valid question. “Despite this symbiotic relationship, today the film industry is valued at 19,100 cr., while the music industry is valued at a mere 1,500 cr,” notes the report’s introduction – that’s around $2.5bn and $198.9m respectively.

A couple of reasons why IMI thinks the music industry has been short-changed are very specific to India: non-voluntary licensing of recorded music for radio airplay, and the waiving of public performance fees for weddings. However, it also takes aim at a global industry bugbear: safe harbours for ‘intermediary’ user-generated content platforms.

The report suggests that the ‘value gap’ here is between 506 cr. and 700 cr. a year ($67.1m-$92.9m), plus another 361-500 cr. ($47.9m-$66.3m) from a combination of digital piracy and “unauthorised content on short form UGC apps”.

Overall, IMI’s pitch to the Indian government for the music industry is that “had it been allowed to operate with free market values” India could have been the world’s 10th biggest recorded music market in 2019, rather than 15th as it was ranked by the IFPI for that year.

There are other important factors in how the Indian music industry is growing. For example, journalist Amit Gurbaxani wrote for us in October about the challenges of the industry being over-reliant on film music; and a streaming ecosystem still dominated by (pandemic-vulnerable) ad-supported models.

Still, IMI’s new report is a useful guide to what its key lobbying goals are in one of the key ‘high potential’ markets for the global music industry. Shifting towards independent / non-film music and growing the streaming subscriptions businesses are tasks for the industry to tackle, but when it comes to safe harbours and radio / wedding licensing issues, it needs to make its case to the government. Music Ally

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