How mobile and kiosks are transforming delivery of music

In the first part of our series on digital music, we wrote about how music companies are exploring the Internet for sales. In this, the final part, we look at how digital kiosks and mobile phones are changing the way music is sold.

Several music companies have started experimenting with digital kiosks for selling music. Saregama has tied up with Nokia to vend music by setting up kiosks across 25 Nokia stores in four Indian cities. Mango Digital Music Vending Machines (DVM) Network has plans to launch 50 DVMs across Chennai by 2008 and bring that number up to 400,000 all over India by 2010. And all Planet M stores will enable buying of songs by setting up digital music kiosks in their retail outlets.

Though the concept of digital kiosks is still new and yet to be implemented fully at the ground level, clearly these companies are reaching out to the consumer. And that’s not surprising given the poor quality of PC penetration and broadband access. It however remains to be seen if consumers will download music on the move. Ajay Mehra, CEO, Times Retail, has an answer: “Consumers will go to kiosks to get the new tracks, while those interested in a whole album will probably buy a CD.” Mehra says that each kiosk costs about Rs 1 lakh to set up. Planet M allowed in-store digital music downloading at the end of July 2007.

IMI signed a deal with Sydus, a mobile and media streaming company, in May 2007 to digitise its collection of more than 500,000 songs from the past 60 years. Sydus will let its subscribers listen to digital music on mobile and web platforms through OnDemand (a downloadable application) as well as a free music service backed by sponsors.

Is mobile the answer?

Full song downloads and music derivatives downloads have been around in India for quite some time now, thanks to telecom companies like Airtel and Hutch. Airtel, for instance, offers full music download at Rs 20 and music video download at Rs 30. In July 2007, Airtel launched a subscription based mobile music service called Music Station that lets subscribers access a database of 10,000 songs in 17 regional languages.

PS Parasurama, head, content and new product development, Bharti Airtel, says, “We regularly tie up with a range of technology partners, content aggregators, content developers and music labels, whether national or international. Overall, we have 100-150 partnerships with music labels such as T-Series, Saregama, Magnasound and Tips.” He claims that the company has received 90 million downloads so far, and gets a million downloads a month.

Music downloads (ringtones, ringback tones and full song downloads) constitute 10 per cent of VAS revenue in the mobile sector. There is no denying that newer formats like digital music through mobile phones have created an impact, though the transition to full song downloads will take some more time.

However, there are certain issues here. Technologies like bluetooth and infrared make it easy for mobile users to share music illegally. DRM (digital rights management), which does not allow copying or sharing of music, is the most preferred method of combating piracy. And, of course, bandwidth issues (and the wait for 3G) are crucial factors that will drive the emergence of full song downloads on mobile.

While kiosks are still catching on, the 170-million strong mobile population points to the clear advantage of the mobile phone as a music device. “The new digital kiosk system will help music companies in earning more revenues in the long run. The mobile phone is becoming like an iPod, and for the first time non-physical sales of music are happening via mobiles,” adds Lazarus. The future for music sure sounds sweet – as long as it can be downloaded.