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Private FM hits music industry badly

08-November-2002
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Private FM hits music industry badly

The Music industry in India is experiencing the blues once again. The launch of almost a dozen private FM stations has hit the records business. According to the music companies, FM stations are responsible for drop in sales of audio CDs and cassettes.

A drop of 30 to 35 per cent of the total sales in the past nine to 10 months is what Saregama India managing director Abhik Mitra indicates.

Right now, private FM companies offer the international experience as an explanation. An official of a leading private FM station says: ‘‘It is a worldwide phenomenon that growth of FM radio initially hits the sales of records and CDs.’’ But over a period of time, FM triggers records sales, he adds. So, if this trend applies to India as well, the records industry of the country is expected to experience a boom within a few years, he adds.

Even if a boom in records sales comes in a few years, the music industry is not ready to sit quietly till then. For instance, the Phonographic Performance Ltd (PPL), which administers the broadcasting/ telecasting and public performance rights of its member companies’ sound recordings including music cassettes and CDs, is in litigation with private FM radio players.

Music, incidentally, forms the big chunk of the content that private FM stations play. Private FM licencees are not allowed to broadcast news and current affairs programmes. They, however, can air sport, traffic, weather and city updates. An FM player gives an approximate breakup: In a typical 60-minute slot, there are advertisements of around 10 to 12 minutes, spoken words of 8 to 10 minutes and the remaining is music.

The survey was conducted by NFO-India recently, when PPL approached it for the same. Purpose of the survey was to understand the effect of launch of private FM stations on the listening time and sales of records. In the past six months or so, the duration in which most of these private radio stations have come into operation in cities as diverse as Mumbai, Lucknow, Indore and Bangalore, sale of records/audio CDs/tapes has dipped, according to the survey. Ahmedabad, Pune and Vizag are the other cities where private FM has a presence.

Take for example, the findings on purchase of records. The survey, which covers three segments—household, personal car owners and taxi drivers, shows that the average number of records bought per month has dropped from 3.2 (five months before the survey) to two. City-wise, the dip in records sales is like this: in Mumbai from 3.2 to 2.4 per month, in Indore from 3.1 to 1.7, in Lucknow from 2.6 to 1.7, and in Bangalore from 3.7 to 2.4. When seen in money terms, the average spend on records per month has dropped from Rs 130.60 earlier to Rs 80.70 post-FM radio.

While listenership of radio has increased significantly across centres, that of records has witnessed a drop over the past few months. Interestingly, the maximum impact of private FM has been felt in Indore and minimum in Mumbai.

In a score of 30, representing each day of the month, Mumbai is seen at 22 pre-FM, and at 25.6 post-FM, in terms of radio listenership. The frequency of listening to records in Mumbai has however remained unchanged at 22, even after five private FM stations have come into existence in the metro.

In comparison, Indore shows much more swing. From 17 earlier, radio listenership is up to 29.1 in this city at the time of survey. As for records, the listenership is down from 25.1 to 19.1. In Bangalore, radio listenership is up from 19.7 to 26, and records listenership down from 21.2 to 19.4. Overall, radio listenership is up from 21.2 to 27.4, and records listenership is down from 22.8 to 20.6.

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