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TikTok, Facebook and Instagram bring music to labels' ears

Music companies such as T-Series, Times Music & Saregama set to earn over Rs 100 crore this year as users put posts on these platforms with their music. Many experts say these are early days and with more users in India getting exposed to social media's features, music labels will benefit more. The revenue potential of these platforms may increase substantially.

Updated: Dec 14, 2019, 11.39 AM IST
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NEW DELHI | MUMBAI: As millions of users search for the right music to express themselves better on popular social media platforms like TikTok, Instagram and Facebook, music labels such as T-Series, Times Music, Universal Music Group and Saregama are laughing their way to the banks.

Reason – the social media apps have to pay a licence fee to music labels for rights to use the music.


Industry experts say Indian music labels should earn Rs 100-Rs 120 crore this year from social media networks, a revenue stream that did not even exist till last year.

“Facebook and Instagram have signed annual deals with most of the labels for their entire catalogues, while TikTok is being selective. Put together, these companies are spending over Rs 100 crore this year, out of which (spending by) Facebook will be close to 80%,” said a senior executive with a large music label.

TikTok, Facebook and Instagram did not respond to requests for comment.

A source in Instagram said on condition of anonymity that the company was “ready to invest heavily for music rights” to offer more options to consumers. It already has global deals with top labels.

Many experts say these are early days and with more users in India getting exposed to social media's features, music labels will benefit more.

“We are now in version 3.0 of music’s overall digital usage; first being mobile ring backs and downloads, second being streaming and the third being consumers expressing themselves using our music on open platforms,” said Mandar Thakur, COO, Times Music, which is part of Bennett Coleman and Co Ltd that also publishes this paper.

The revenue potential of these platforms may increase substantially once consumers adopt it more fervently, Thakur added.

Interestingly, using these songs on social media apps is also helping labels promote the tracks at no extra cost. Many songs have become popular through TikTok, especially when several influencers on the platform make or re-create videos using them, which leads to a wide variety of user-generated content on the same audio.

“These apps are not just good revenue potential but also a promotional platform for us,” said Vinod Bhanushali, president of media, marketing, publishing (TV) and music acquisitions at T-Series. “These platforms take our music directly to consumers and more popular content get more hits and further drives popularity.”

It is not just users who are lapping up the music feature.

Many brands also utilise TikTok and Instagram for their campaigns.

Prashant Puri, CEO of digital marketing firm AdLift, said 80-85% of the campaigns on TikTok have licensed music in the background.

“TikTok is also trying to get into the YouTube realm now with content on education and health, so that could be the rest 15-20%. But, with Instagram and Facebook also launching music offerings – and depending on the license fee and how deals are structured – music distribution companies are looking at these partnerships as a promising revenue stream,” Puri said.

Ahmed Aftab Naqvi, co-founder and CEO of digital agency Gozoop, said, “Influencers were very excited when the music offerings were launched on Instagram in September. Even brands like Swiggy, JBL and McDonald's have leveraged music offerings very creatively on Instagram.”

Influencers on Instagram have, however, not been able to leverage music and take it to the next level like they can on TikTok, as the Chinese ByteDance-owned app has features that allow influencers to edit, remix and pace the songs.

“Platforms like TikTok use music like no one else,” said Bhuvan Bam, India's most famous YouTuber and influencer. “The cross promotion of songs from TikTok to YouTube is massive. Music has universal appeal. A music piece on any visual would have more impact.”

Bam, however, avoids using songs on his social media channels due to copyright issues. “I use my own compositions instead,” he said.

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