Big changes are afoot at Indian music streaming service Gaana, which is shutting down its free tier in order to focus purely on paid subscriptions. However, according to Reuters, which has seen an email sent to music partners by the company, the shift does not appear to be coming from a position of strength.
The email, from head of content and partnerships Sachin Kamble, explained that Gaana had failed in an attempt to “bring in fresh investments” and also that a potential acquisition of the company had “fallen through”. Reuters’ sources suggested the suitor was Indian telco Bharti Airtel, the owner of rival streaming service Wynk Music.
“Now we are at (a) crossroads – wind down/find a way to continue … we have decided to give this another try. Hence, we have closed streaming for free users today and (are) moving to paid only model,” wrote Kamble to partners. “We will need your support on this, else we will have to shut down completely.”
It should be noted that Gaana has since pushed back on the reporting of this email, with a statement claiming that the company “is a strong business that is increasing its focus on subscription business with an intent to be a lasting company for years to come”.
However, as Indian journalist Amit Gurbaxani explained in a Music Ally piece last December, Gaana endured a tough 2021, with the resignation of its CEO; the replacement of several other senior managers; reports of unsuccessful efforts by parent company Times Internet to sell Gaana; and claims of ‘stagnant’ advertising and subscription revenues.
Gaana has long been one of the biggest Indian music services, reporting that it had 185 million monthly active users in August 2020. Since then, the competition has only increased both from its domestic rivals; new entrants like ByteDance’s Resso; and global players like Spotify and YouTube Music.
In October 2021, a report on Indian news site Mint claimed that Spotify, Resso and Wynk Music were the three most popular music streaming services (YouTube’s main service excepted) by monthly streams, having overtaken Gaana and another established DSP, JioSaavn. Since then, JioSaavn has also undergone a shakeup in its senior management.
Challenges for the established Indian streaming services, then, facing the twin pincer of global rivals and an upstart disrupter (Resso). All this, against a backdrop of the Indian music industry’s desire for more free listeners to be encouraged into paid subscriptions – a shift that has yet to truly ignite in India.
The country was the 17th biggest recorded music market in 2021 according to the IFPI, still falling short of the industry’s ambitions to crack the top 10 of those rankings. Subscription streaming revenues grew by 25.5% in 2021 to $53.3m, but were still smaller than ad-supported audio streaming (up 17.9% to $83.2m) and ad-supported video streaming ($53.8m).
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