The document discusses the Indian music industry and the potential for musical.ly in India. It notes that while the Indian music market is growing, it still lags significantly behind the US market in revenue. It also discusses how local leaders like T-Series dominate the market due to their production of Bollywood music. The document then covers the rise of streaming services in India and opportunities for musical.ly to grow its user base, engage users, and monetize the platform through advertising, promotions, microtransactions and other means. It proposes partnerships and licensing models to help control costs and protect the platform from copying by competitors.

1. The Indian
Music Industry
&
musical.ly

2. The Great
Indian Circus
Let the show begin

3. › India has now become the second-
largest smartphone market in the world
› Estimated to reach 500 million users by
2020
› Data rates have fallen drastically
enabling increased data consumption
› Even then..

4. 300,000,000$
In Annual Revenue
The size which the Indian recorded music business will reach in
2019, which may seem a lot but it is just...
4%Of the US recorded music business (2016) revenue which earned
7,650,000,000$

5. Local Leaders
› The Big 3 in music – Sony Music Entertainment,
Universal Music Group, and Warner Music Group
– have little say in India
› The market is ruled by players like T-series, Zee
Music, Times Music, etc owing to the moats they
have created by ruling one thing..

6. ...Business of Bollywood
› Bollywood accounts for 80% of the Indian music
industry revenue
› Local leaders – produce Bollywood movies, have
artists signed to their labels, and promote them
as playback singers – creating a virtuous cycle
which entrenches them against foreign
competition

7. The Higher Authority
› Government regulation also has a part to play in
low penetration of International music
› Where FM radio provided support in US and
other countries, All India Radio completely
regulated the radio market until 1999
› Thus, foreign players have a huge gap that they
need to cover

8. Copyright conundrum
› Until the Copyrights (Amendment) Act 2012, producers used to
pay a one time fee to composers and songwriters who then had
no authority on their work
› The new law now assigns non-transferable rights to the artists
for a period of 60 years
› IPRS, registered in 2017, is a society which looks after violations
where licensees do not pay royalties to composers/lyricists
› There is still no clarity of scope of IPRS because of long term
copyrights for artists still being in a nascent stage in India
› PPL and Novex are some other societies which look after
royalties for playing recorded music publicly

9. Rise of Streaming
› Music Streaming in India recorded 27% revenue
growth in 2017
› Major Players – Saavn, Gaana, Wynk, Hungama
and Jio Music
› Revenue Model – Advertising and Subscription
› Subscription packages are around Rs 100 per
month

10. Rise of Streaming (contd.)
› International music is the fastest growing
category in online streaming
› Bollywood’s share in streaming dips to 60%,
leaving room for International, Regional, and
Indies to grow and be discovered
› Piracy is still the biggest threat to the industry

11. Streaming Model
› While Saavn and Jio license music on a minimum
guarantee, Gaana and Hungama pay royalties on
streams
› A play is counted as a stream if the time
duration exceeds 10 seconds
› The market industry standard on royalties is
0.0011 cents per stream (7 paise per stream)

12. Independent artists and events
› With platforms like YouTube giving access to
everyone, independent artists are on the rise.
› On YouTube 500 creators have more than 100k
subscribers, 14 have more than 1 million
› Movie producers are giving opportunities to new
artists
› Mumbai, Bangalore, and Calcutta are rife with
local underground communities, with artists like
Nucleya and DJ Ritviz being shot to fame
› The industry still needs to be more open to this
talent

13. The way for
Growth, Engagement, &
Monetization
musical.ly

14. Audacity of Copying Well
› Features don’t differentiate
› Samsung copied Apple by launching full screen
phones
› Instagram copied Snapchat Stories
› Facebook has now launched a lip-syncing
functionality on live video
› What differentiates Musical.ly that will protect it
from this threat?

15. Climbing the ladder
Launch of
musical.ly
Creating
live.ly and
other
products
Extracting
value from
the
ecosystem
First
Delivering an
orthogonal product
that appealed to an
underserved
market
Second
Leveraging the
position to create
an array of
products to expand
the total
addressable market
Last
Increase the
service’s revenue
potential through
this huge unique
user base

16. Growth & Engagement
Reaching our audience
Introducing musically Originals
by partnering with up & coming
bands.
Focusing on India’s Top 15 cities.
Sponsor college fests, and local
music events.
Preloading the app on OEMs
through platforms like Digital
Turbine
Verbal.ly
YouTube, Snapchat and
Instagram lack platforms where
Influencers can connect with
Brands.
This gap is being filled by
platforms like GrapeVine.
Musically can inititiate to fill this
gap on an intimate level to
attract more influencers.
The goal is for them to migrate
from other platforms to Musically
Engaging our audience
Monthly contests and giveaways.
Brand and movie promotions

17. Monetization
Native
Advertisements
Musically can now
leverage its user base and
the new UI to introduce
native ads on the
platform.
Ads can be short format
(5-10 secs) which don’t
hinder the experience of
the user
Movie
Promotions
With big budget movies
on the rise, and films
regularly crossing
landmark revenue figures,
producers are looking to
invest in a promising
platform for promotions.
Actively engaging
audiences through film
dialogues and songs
trumps over passively
watching movie trailers
and posters
Brand Sponsored
Posts
Musically has a young
audience with a skewed
female audience.
Brands with this target
audience have an
opportunity to engage
with them.
Musically needs to tap
these brands to unlock
this huge revenue
potential

18. Monetization (contd)
Micro
Transactions
Instead of following a pure
subscription model or a pure
advertisement model,
Musically can introduce micro
transactions.
Musers or creators can buy
exclusive Songs, Stickers,
Filters, & Masks for minimal
cost (few cents).
Will be great for launching
Brand sponsored stickers
Event
Promotions
With the rise of independent
bands and the local music
scene, Event organisers are
looking to reach out to a
larger audience.
Musically can partner with
major events like NH7
Weekender or Sunburn, and
with city specific events

19. Cost Control
Licensing Model
Instead of licensing music on
fixed guarantees, Musically
can follow the Gaana model
of paying royalties based on
streams.
A tie-up with a music partner
like Saavn, where Saavn Pro
users can access a wider
catalogue will help reducing
direct content deals with
Music labels
Barter Deals
As mentioned before, the
Indian music industry works
on producers creating
Bollywood movies and them
having the music rights.
A barter where musically
promotes a movie in
exchange of music rights –
perpetual or limited – is a
win-win

20. Some notes for Business Plan
› The Business Plan for Musically is for the
next one year
› Licensing cost is based on royalties
being paid per use of a music piece
› Fixed costs can be discussed internally
› Figures are conservative, and derived
from assumptions

21. THANKS!Mehvish Quadri
Mehvish.quadri10@gmail.com