Saregama still has its recording and artist development function or A&R (artiste and repertoire). But it has taken a call on the format it wants to bet on, and there is no prize for guessing. Close on the heels of the parent, RPSG Group’s decision to shut the MusicWorld retail chain, Saregama has licensed Sony DADC, the physical format manufacturer, to produce its CDs and DVDs for the next three years.
The CFO G B Aiyeer says, “There was a question of capital allocation. So, we have decided to focus on digital, which is a younger business but gave us 70 per cent last fiscal.” Aiyeer refers to both Saregama’s own portal launched in 2008, and the ties with telecom operators, mobile phone manufacturers, DTH operators and Internet music aggregators who offer myriad means of music perusal such as caller ring-back tones, downloads, subscriptions and streaming.
But digital stores can fold up too. Flipkart, the veteran e-commerce player, closed its Flyte service which sold music titles and albums much like a desi iTunes, but found few takers due to rampant piracy and the absence of easy online payment models.
So, even when Saregama and Tips have their in-house digital teams and partnerships with platform providers, why keep the physical format alive?
After all, retailers are performing dismally in sale of physical formats of music. “We tried eschewing a CD for Race 2 but Twitter burst out in protest, for example,” points out Taurani. Gupta agrees that “cutting a CD” is still the best way to launch music.
More at Business Standard.com
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