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netflix: No Netflix-like slowdown in content consumption in India: Saregama MD Vikram Mehra

While Netflix reported a dip in its subscriber base for the first time in a decade and YouTube’s ad revenue growth disappointed Wall Street analysts, music label Saregama’s Managing Director Vikram Mehr says there’s no such stress on the streaming business in India.

“Our YouTube views and OTT streams have actually gone up in the last few months. A large part of music listening and video viewing happens when people are traveling back and forth from office. So, we don’t see content consumption going down in India,” he says in an interview. Edited exceptions:

Your revenues have been growing consistently. How sustainable is the momentum in FY23?
The results have been positive and encouraging indeed. The foundation of this growth is the ever-expanding global and Indian digital ecosystem, wherein more and more people are consuming content in a legitimate way through their smartphones. If you combine that fact with Saregama’s efficiency and expansion initiatives across business verticals, there is every reason to believe that the growth will not only sustain but also improve. The focus is on investing aggressively on new music content, films and web series under Yoodlee and technology and data capabilities to improve monetization efficiencies.

You had earlier projected a growth of 22-25 per cent in revenue over the next 3 years. What are the key growth drivers you see ahead?

The biggest pillar of Saregama’s growth is our music licensing business. The sub-drivers for this growth within the music space are:

  • Saregama’s high investments in new music across languages
  • Growing popularity of retro content due to easy access through digital and consumer’s movement to legitimate sources of music listening.

Additionally, the vertical films and series under our brand Yoodlee is riding on the wave of consumers moving away from pre-programmed TV content to on-demand content through OTT stores. OTT has exposed Indian consumers to higher quality storytelling, and Saregama’s operating structure of sharing profits with writers and directors helps us to excel on this front. Furthermore, the live events’ space is scaling up at global level, and we are making moves there as well. With Covid impacted supply and demand position slowly correcting itself, we expect Carvaan to start reverting to its original stats and position.

Would it be correct to say that a large part of Saregama’s growth is directly dependent on the growth of digital consumption in India?
Saregama is the only company that has hedged itself across digital and physical. So as long as people listen to music or watch series / films, Saregama will keep growing.

Both YouTube and Netflix have disappointed investors in their latest quarterly results by reporting a slowdown. Do you think the growth rate of the streaming industry in India will slow down a bit as well as we are back to offices, schools and malls?

Actually, no. Our YouTube views and OTT streams have actually gone up in the last few months. A large part of music listening and video viewing actually happens when people are traveling back and forth from office. So, we don’t see content consumption going down in India.

What is the outlook on growth of streaming platforms in India and the shift towards subscription-based services?

Content streaming is growing leaps and bounds in our country. This comes from both growth in the number of unique users as well as numbers of songs heard per month. Lockdown has resulted in a new segment of customers joining the streaming world ie, 50+ age segment which has gotten forcibly exposed to the magic of streaming by their kids / grandkids, and now they can’t get enough of it. We believe that streaming platforms in India have to make their transition towards subscription sooner than later. It will not only benefit them and the music labels, but also the artist economy. And the success of DTH platforms, and VoD app shows, with Indian consumers now ready to pay for quality and better experience.

How is Carvaan’s conversion to a platform service shaping out? What is the projection in terms of how much recurring revenue you can generate from both subscription and advertising?

We are surprised by the engagement levels seen by the podcasts put on Carvaan 2.0. With lockdown effects slowly waning, we will see more action on Carvaan the platform side.

How much of your focus is on the regional space? Is that going to be the growth driver for the next few years?

Regional space has been booming and it remains untapped to its full potential. There’s a substantial investment we are making across all leading Indian languages. We are aggressively acquiring film and non-film music across Telugu, Tamil, Malayalam, Bengali, Bhojpuri, Punjabi and Gujarati. This will be further extended to 3 more languages ​​this year. And as a symbiotic move, we are also investing in films across these languages.

Can you tell me what is your plan for the live events business?

Live events are a natural extension of our music business. In an entertainment crazy country, we believe there is a big scope for well-organized live business, wherein both customers and performing artists get a fair value proposition. We have been keen on entering the live events space for a while now. Our first event kick started with Diljit Dosanjh, and it was a huge success. We are now taking his concerts from him to the US and Canada. We also plan to launch our Disco Dancer musical play around X’Mas this year.

Any acquisition plans?

Yes, we are keen to acquire/ partner with other music labels, especially in regional space.


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