Exclusive Interview with Mr.Shridhar Subramaniam

First of all Congratulations on acquiring the music rights of SAAWARIYA!!!

According to industry sources, the music of Saawariya is so extraordinary that Sony BMG's Senior Management team from Hong Kong had to be flown in to acquire the final deal.
Tell us something about this coveted acquisition of yours??

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Saawariya actually is the first production for SONY PICTURES WORLDWIDE in India. It’s a very big deal for Sony Worldwide. Internationally it marks our entry into the local production market in a very big way. The Film, The Director, The Script and the Budget are all larger than life. So it’s a big commitment from Sony BMG India to the India market and the Indian Entertainment. To that extent yes it’s a very large acquisition and we have done it.
In fact people flew in not just from Hong Kong but also from the US to try and see how best we can use the sound track to project Indian Music to a global audience using the Sony clout, be it Sony Pictures, Sony Computers, Sony BMG, Etc. So we are very excited about it.

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'SAAWARIYA' Review

Listen To The Songs

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In the Indian market, SONY BMG has always been a consistent performer on the Bollywood as well as on the international music scene.

Tell us more about this Shridhar – Secret - Mantra that has grabbed a considerable Indian Market share within a very short span of operations? How do you read the Indian music listener so perfectly?

I don’t think it’ll be right to say that there is something like a secret mantra. Sony music & now Sony BMG has always had a consistent approach to the Indian Market. We have been here for exactly 10 years.
15th Aug 1997 was our first global Indian release which was Rahman’s VANDE MATARAM. Our first soundtrack a year later was KUCH KUCH HOTA HAI. So we began on a very ambitious, on a very proud, a very prestigious outthought of what we had. Since then we have always followed that virtue. A lot of people have called us a boutique label, in the sense that we don’t do a lot of local products. We do only 7, 8 or 10 local products a year. But they are all very high quality, very high profile, something that we as a company are proud of. Our products and songs have made India and Indians proud of.
So if you look at the last ten years that we have been here, we actually made some amazing soundtracks, be it LAGAAN, or Rang De Basanti, or be it Kuch Kuch Hota Hai or Kal Ho Na Ho. Some of our projects have actually been landmarks in Indian Entertainment.
Also we have actually followed that up with some pretty aggressive pop projects, be it Kailash Kher, or be it something like a DANCE Masti or be it Abhijeet Sawant from the Indian Idol, which was the first Indian reality TV show.

So we have been at the front of a lotta things. But I think that the real mantra is that YES we haven’t done too much, we have done a few but they have been precious ones.

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Related Article (The Financial Express: July 12, 2007) - Sony Corporation is targeting two billion dollar revenue from India operations in next two years.

Your growth has been phenomenal.
Would you like to tell us about SONY BMG’s future projections and strategies for the Indian Music Market??

Yes absolutely.

I think Sony has obviously got very aggressive plans here in India in every aspect of its vertical businesses. And obviously music in Indian Entertainment is a big chunk and I think Sony is one of the few companies in the world that has its hands in every aspect of the entertainment, be it on the software side or on the hardware side, be it in computers, games, movies, music, etc.
I think very few companies can manage to do that. And I think in India, that synergy will probably become some sort of a case study as to how such a synergy can work in the entertainment market.
So there’s a lot of commitment from the Sony Management towards the growth of the Indian Market. Yes 2 billion is possibly the first step.
And in India if you see Sony has got a beautiful blend on both the hardware and the software side. I think in India if you say SONY, people will say the Vaio Laptop or the Bravia TV set but in the same breath they will tell you SONY Pictures or Sony BMG. So it’s a beautiful blend of both the hardware and the software side.
So I think you will see a pretty aggressive, unique development on both the Sony businesses in India.

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The music industry in India has reportedly been facing turbulent times in the past few years. In such a scenario do you see some kind of consolidation or Mergers & Acquisitions taking place?

I think its obvious. See Sudhir, Currently the Indian Music Market is 120 to 130 million US$. We have something like 300 music companies operating in the market. It’s a very fragmented market in the terms of language. There are music companies which make music in only one language and then there are companies which make music in 14 to 15 different languages. So its obviously a very fragmented market. And the first thing that’ll happen in that kind of a market is consolidation. And Consolidation has to happen in the Indian market and will happen soon.
The biggest music company in India has a market share of 18 to 19 percent. Whereas internationally the biggest music company will probably have a market share of 35 percent. So there is a lot of room for consolidation. And of course very soon you will see Indian companies consolidating, international companies consolidating.
So basically we will land in a situation where we will probably have 8 to 10 music companies in the next 12 to 18 months all of them having predominantly a national footprint.
In fact we have been here in India for 10 years and we have pretty much been in the Hindi music market. The Hindi music market is about 50 percent of the Indian music market. We have not operated in the South, we have not operated in the Punjabi repertoire or the Bengali repertoire or even in the Maharashtrian repertoire for that matter. So to that extent we are a very big company but a very small part of the big Indian Music Market.
So I think the first thing that’s gonna happen is a lot of companies are going to create a national footprint but there will be fewer companies as we go forward.

Is SONY BMG planning any acquisitions in the Indian Market?

Whether we acquire is probably an aggressive word.
But clearly there will be 2 parts. The first is there will be an organic growth, which will see our entry into local repertoire. We are going to enter the Punjab market, we are entering the south Indian market in the next few months. So you will see us extending our footprint on the organic wave.
Second is probably we will strike partnerships maybe alliances with companies and look at whether we can create our market share to grow even bigger but that’s currently in the plans.
Right now our first focus is on organic growth.

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Since Indian music is so heavily Bollywood inclined, off late the Indian music industry has started hunting for alternate sources of content.

For example TIPS has lately been actively promoting some Paki Artistes, Punjabi artistes etc.

Why is it that we don’t find SONY BMG promoting fresh cross culture artistes who thrive in the Indian market??

I think, it’s not correct that we don’t do cross culture artists. I think what we don’t do is we don’t do a lot of it. We do a MINI of the same thing. Let me give u a snapshot of what we have done.
If you see AR Rahman’s first album was signed by us. If you've seen Shankar, Ehsaan, Loy was signed by us. If you’ve seen Bombay Vikings, that was signed by us. If you see Abhijeet was signed by us, Kailash Kher was signed by us. Talking about Pakistan, the first & the biggest Pakistani band, STRINGS, their album was signed by us. If you talk about UK and bhangra music in UK, Bally Sagoo was a SONY artist. He was a pioneer. If you look at the number of gujrati HIP-HOP albums coming out in the US, they have been signed by us.
In fact our problem is that we are too much of a pioneer, we are too early and we don’t dominate a segment like you say dominating Pakistani music or dominating bhangra music. We don’t do too much of anything. Like we don’t do too much of movies, we don’t do too much of pop we don’t do much of any specific music. But in terms of our tastes and in terms of the kind of music we promote, I can tell you that we are probably the most adventurous company in India in terms of putting up experimental music in India. And not just us every artist in India will tell you that.

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Ever since you’ve lent you've support to The Indian Idol, it has come a long way into its 3rd season.

Supporting ‘The Indian Idol’ is it a strategic decision or is it a compulsion to promote the programme since its being aired on your group company’s channel?

Hold On Sudhir!! Firstly let me clarify this popularly mistaken and misunderstood concept.
Indian Idol came on the back of the success of the international idol or The American Idol. Simon Powel and his company Sicom, they actually work for SONY BMG. His company is owned by SONY BMG. That format is developed by Sony BMG and then we license it to television companies across the world. So our involvement and participation in the reality television show or THE IDOL FORMAT is a lot more than us just going and doing it in front of Television. Its much more than all that. The format is owned by us.

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Related Article (businessofcinema.com, 20th July 2007) – Shridhar Subramaniam says "It is a pleasure and a privilege to be launching the second album with Abhijeet Sawant. Abhijeet is a true inspiration to the common man. He has raised himself to touch the realm of success in a short span. In Abhijeet I truly see a great bundle of talent and an exemplary artist, who has just about started displaying his true capabilities. I am certain that his current album Junoon will be a rage amongst all music lovers."

You have been very vocal in your encouragement to Abhijeet Sawant. Is it a marketing decision to give him that kind of exposure??

Not really. See you must understand that here’s a man who has forty million votes in the most popular television show in India ever. Forty million votes would be the kind of votes the country’s largest party got in the last election.
So, forty million votes is not a small thing. Even today people love him.
U must understand that in reality television shows these stars are created by the fans. Its not that we make a star. It’s not a case where the brand creates a star but a case where the fans create a star. So our responsibility goes to the artist in the sense of “keep pushing them”.

Do these singers last? Are we going to see the same kind of support as that extended to Abhijeet to the other contestants as well??

See I think invariably the established and the old school of thought people would say how can a talent hunt singer be viable to the industry. They would say ' he is just a gimmick.'

But lemme tell u something that i think. If the guy is a gimmick, he/she would obviously vanish as quickly but if they are truly talented, and they have the tenacity, they have the survival instinct and they know what their fans want, they will survive.
Of the lot Abhijeet fills out that vacuum. He is genuinely a talented person. He is a nice person. He has a unique voice, unique stamp. He is modest humble yet he has a certain quality with him that everybody likes which kind of makes him up for a good star.

So if yo u ask me will he last? He certainly will.
But can I say that about all the other contest winners? No!!.. some of them just come and go and you don’t even know their names.

Like for example in the current season I think something exciting will come out again. There seems to be a certain excitement and magic amongst the people who are performing out there.

On Support to these artists??!!!

See support to an artist is not a measure of how much we like the artist. Support is a measure of how commercially viable we believe the music of that artist is. You must understand we are in business. We invest in proportion to what we can basically make. So it’s not a emotional decision. Unless we see that we can recoup, we won't invest. So it’s a very calculative decision.

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Related Article 1 (American Public Media, July 5 2007) - The music business is usually split into two halves. One finds, develops and promotes artists. The other focuses on songwriters and publishing. Sony BMG is the world's second largest record label, but it's not been in the publishing biz.

Related Article 2 (American Public Media, July 5 2007) (Dan Sabbagh, editor Times Of London says) - Sony BMG's the No. 2 recording Music Company. It will survive but it will fare a lot worse if it doesn't have access to a publishing business, it'll fare a lot worse commercially. Music publishing generates revenues from radio airplay, from advertising, as well as indirectly from sales.

How correct is this information that, internationally SONY BMG is trying to sign up SONG writers? Is such a strategy going to be deployed in the Indian context as well?

Yes Music business is clearly split into 2 halves, One is the Recorded Music which we participate in and the other is the Publishing Business which is essentially song writing and the song writers and that’s the part which we do not focus on.
Now SONY BMG is not in the publishing business not because we don’t want to be in it but because for the merger of SONY & BMG to go through at the US commission, we had to exit certain businesses one of which was The Publishing business.
So to that extent we are not in the publishing business because we are not legally entitled to be in the publishing business but if you ask me, in the future is there money in the publishing business? - Yes. Of Course there is money in the publishing business.

Will we ever get back into the publishing business? - Yes. We hope to get back into the publishing business very soon. Publishing is where most of the action is.

In India the Publishing business is yet to develop. Unlike in the west, In India a lot of our music is film music. The entire unit members that work for a film do not own any of the intellectual property they might have generated during the making of the movie, for example the song writers, the composers, etc. They all pass the rights to the producer of the movie for a pre negotiated amount who makes money by selling the movie to his distributors, etc but is eventually never benefited in the long run by this intellectual property.

So as far as music and the publishing business is concerned, in India it’s a very different kind of an industry but yes there is growing awareness amongst the song writers and the composers. We at SONY BMG are keenly watching this growing awareness and if and when the publishing business develops in India we will certainly be a part of it.

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Recently the discussion around piracy has taken great momentum. It’s a Global phenomenon, which must be obviously depressing for SONY BMG, who is a Global leader in the music industry?

What are some of your major concerns?

In India what we are seeing is a B2C kind of piracy where typically a retailer is pirating the company’s recorded music and selling it directly to the consumers. But I think in the rest of the world it has moved from the B2C model to a more organised C2C piracy model where consumers are exchanging, swapping, sharing and trading pirated music over the internet and the mobile phones. So to that extent I think we have fundamentally lost the moment to wage a war against piracy.
I say this because now its not about stopping companies or individuals who are dealing in pirated music which by the way we can still do in India but today a consumer doesn’t believe in paying the company’s MRP for the music he wants to listen.

Today if we try and sell music over the internet to a consumer he doesn’t believe he needs to pay anything. Just like the way he doesn’t believe he needs to pay for an email service utilized by him. Now with that kind of concept set in the consumer's mind, for the music companies to generate value for the consumer to buy music is the hard part.

But I feel in the Indian context there are clearly 2 parts to fighting piracy. One is chasing piracy that is shutting down pirate units and getting them to the books of law and the other part is to create an alternate legal offering where consumers can buy and listen to quality music without infringing upon the copyright law.

Today If you see the Indian consumer, he is ready to spend for music when it comes to mobile phones. There is a lot of money in the ring tone market. But on the internet they feel they don’t need to pay any money to get their favorite music. In a Pub or a hotel while dining, they don’t believe they need to spend to enjoy music but in a coffee shop they would spend money to listen to music on a juke box. So it’s amazing to see how in different environments the consumer behavior towards the same music content changes.
I believe, it’s our job to recognize that and more importantly generate value in some form for the consumers which I think is the challenge and the larger job of fighting against piracy.

I think now and for the future, more and more of the anti piracy fight will be on legitimizing music on various B2B platforms be it television or public performances or music in public utility places etc. Here on it will be a different kind of a game where anti piracy raids will not be the one point agenda of fighting piracy.

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Does it bother you, when some people discuss that the reason piracy is rampant is because music CDs and tapes are expensive?

No I don’t think they are expensive. See when you are fighting piracy what you are fighting against is something that is FREE. And anything is more expensive than FREE. So I think its not a pricing issue.
The issue is do consumers still have the interest in walking into a store to buy music or are they interested in sitting at home and downloading music from free sites or swapping music?? So its just a mindset that has to change and it has nothing do with the pricing.

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In an era where people have adapted to the Internet and digital music & mp3's do you think anti-piracy raids are the best solution to curbing the pirates?

I think in India, these anti-piracy raids do make a lot of sense since here in India we don’t have a lot of online piracy. We don’t have a lot of file sharing or person to person swapping of music.
In India it is still largely the physically sold retail product that is pirated. In India people still go to a retailer to buy a 100-odd pirated songs on a single pirated CD. So to that extent yes clearly these anti piracy raids are of immense value when it comes to the Indian context.

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Does SONY BMG see itself actively getting involved in the anti-piracy crusade just like companies like T-Series are doing it?

See SONY BMG is a part of the IMI because we at SONY BMG believe that fighting piracy is not just a single company effort but as an industry its our prerogative to protect our interests. So we need to collectively fight piracy as an association. And not just as one single industry but all the industries that are affected by this stigma need to come together to fight piracy.
I personally don’t believe that no single company can effectively ever fight piracy. All they can manage is some sort of noticeability but will they ever cause a dent to PIRACY is a question they need to ask themselves.

So NO. We will never plan to go solo on fighting piracy.

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What do music companies expect from a body like IMI? How do you chart their progress in the Indian context ?

I think the key thing about a body like the IMI is the efficient manner in which they tackle piracy. See today Piracy has moved on from just CD’s to i-pods and mobile chips and in the future technology will throw up a lot more devices and means to assist piracy that the IMI will have to fight against. But I am happy that they are updated with the recent technological advances and are doing a good job. The essential thing here is maintaining the pressure on the pirates and the IMI is doing it very well.

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What kind of support do you provide to the IMI as a body?

Since we are an active part of the IMI we contribute not just financially but also help in giving the right direction to the IMI. Our feedbacks to their actions give them an orientation and direction to keep the war against piracy on track..

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Jus to end it on a lighter note -

We all know that Mr.Shridhar Subramaniam started his career in 1987 as Marketing Officer for Titan Watches Limited, one of the many TATA companies and ever since you have come a long way. Considering the fact that you've come from a non-music background and a non-filmy background, you have done extremely well for yourself in this market. How was this transition ? Was it a smooth one??

It certainly wasn’t a smooth transition. I’d be lying if I tell u that I know or rather I knew back then what doing business in the music industry was all about. I think that, at some point of time when we all started this company we all were new to this industry and were learning the ropes of the music business. But let me also add in the same breath that the day you feel you have cracked the formula of running a successful music business is the day you are going to be out of the music business. It’s an ever growing industry with complex parameters that we learn to deal with everyday.

Sir, are you a music buff? Which are your favorite artistes / Songs?

I am a music buff but let me tell you that what I like does not sell. So if I know that I like something then it’s a rule at SONY BMG that we should not be chasing that. Hahahaha….

Your favourites Sir???

My favourites go right back to the 60’s and the 70’s. My all time favourite have been Bob Dylan apart from a few classic rock bands of the 70’s.

Message to our readers –

I think music is one of the few forms of art and culture and entertainment which is so pure that it touches people’s hearts despite barriers of nationality and diverse languages. It’s a very emotional art form that has changed with the way we have evolved over the years. Its one of the most powerful art forms available to mankind which we need to protect from the curse of Piracy for now and forever.

With that I’d like to end our interview. It was a pleasure speaking to you. Thank you Mr. Subramaniam.

Thank You Sudhir.

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