Saavn, India's Spotify, Blurs the Line Between Streaming Service and Record Label

Courtesy of Saavn
        

"I believe that this company will be the streaming service of India," says early backer Guy Oseary.

As the increase in streaming subscribers continues to push the global recorded music industry to growth it hasn't seen since the last millennium, there has been a slight shift in power from traditional record labels towards digital streamers like Spotify, Apple Music and Amazon. Now, Indian streaming service Saavn -- the subcontinent's version of Spotify, with 20 million monthly active users -- is moving to break down the boundaries between streamers and labels, assuming more of the responsibilities that labels have long provided for their artists.

Already, signs of the shift have appeared in the U.S., as Frank Ocean's Blonde and Chance the Rapper's Grammy-winning Coloring Book were released directly through Apple Music without the support of any record label, raising the question of whether Apple would move to expand its operations. So far, the tech giant has demurred from commenting on the possibility, and as Chance and Frank both already enjoyed significant fan bases, there was little risk in investing in things such as artist development on each release.

In India, however, Saavn is taking a more explicit approach, introducing an Artist in Residence program last August -- the company released an album by electronic DJ Nucleya and helped route and promote his subsequent tour using its listening data -- as well as a remix initiative shortly thereafter, aiming to give Indian artists on its platform the rights to remix songs by Western artists such as Maroon 5 and OneRepublic, and vice versa. On Feb. 24, Saavn announced a new Artist Originals initiative, having linked with Indian rapper Naezy to release his song "Azaad Hu Mai," becoming the first streamer in India to back a song from inception to distribution without collaborating with a middleman.

As the service has grown -- 41 million new users installed its app and listening hours doubled over the past 12 months, according to the company's internal statistics provided to Billboard -- it is beginning to expand its outreach to provide more and more services to local artists bypassing the label system and, more significantly, signing artists to direct deals.

"You have a new world of artists that are budding in India, from hip-hop to singer-songwriters," says Rishi Malhotra, Saavn's co-founder and CEO. "Because we have the scale we do, we're starting to blur the lines between a streaming service and a label. Our goal is to be the most creative place for artists to do what they love."

Part of Saavn's success in the space comes from the particulars of the local Indian music industry, which has traditionally been tied to Bollywood and the film world, and encompasses some 900 distinct labels that have resisted the consolidation that the U.S. has seen. Saavn's growth has coincided with both a rise in independent underground artists with no ties to the film world, producing a creative class without a traditional support system -- which created the gap for Saavn to fill.

"If in the U.S. the way artists got promotion and distribution was through mixtapes and radio, in India that has always been film," Malhotra says. "And I think what you've seen in the last 12 to 24 months is the massive disruption of that, due just to the market... In the last year, film music was 85 percent of total streams; now it's 65 percent."

Malhotra chalks that up to several reasons: the generational shift towards mobile and away from traditional television and film; the internet's ability to break down traditional borders, leading to a rise in English language music -- Drake, Sia, the Chainsmokers -- streaming in India; the steady rise in internet access across the subcontinent; and what he calls India's "connectivity tipping point," which he compares to AT&T's introduction of unlimited data plans nearly a decade ago and its subsequent boon for streaming services like Pandora in the U.S.

"In September 2016, [telecom company] Reliance Jio opened up unlimited data, and since then you're just seeing a boon in terms of connectivity and engagement," Malhotra says. "Whereas we used to do 500 million streams in a quarter, now we do 500 million streams in a month, easily, and that's just in the last six or seven months."

Saavn's potential attracted interest from key players early on such as Guy Oseary, who manages Madonna and U2 and runs Maverick Management, who invested in the company through his investment firm, Sound. "I finally was able to do almost two things at once: which is back the best streaming service with the best people involved in India, but also now have a real relationship with India for the first time," Oseary says. "So after, you know, 25 years in the music business, I can finally say to Madonna or any of the clients that we work with, if you want to do something musically with India we have the partner to do it with."

Oseary has been a key part of Saavn's moves further into the label space, connecting his artists with the service's remix initiative, for example. "I’m patient," he says about Saavn's prospects on a broader scale. "I don’t know if the word is explode, but I know I’m going to get to the same place regardless. I believe that this company will be the streaming service of India."

With its original music programs, Saavn also distributes its artists' work beyond just its own streaming service, working songs to radio and releasing them widely to other digital outlets as well -- an approach that seems counter-intuitive for a company that would otherwise be able to directly control all aspects of its distribution. But Malhotra doesn't see long-term value for artists in maintaining exclusivity.

"We believe in distribution, and it's not just about us containing the song to Saavn's user base," he says. "If you do exclusivity in perpetuity, it increases piracy and it really holds back the reason for actually doing this: the music should be heard."

Will Saavn's 360-degree approach catch on Stateside? Apple Music, Spotify and Tidal have all made strides into original content, but it has largely centered around films, documentaries or new television series, like Apple's Carpool Karaoke show. But there have been small-scale steps in that direction; Spotify, for instance, introduced a singles series in November where artists such as John Legend, D.R.A.M. and Tove Lo record an original song of their own and a cover song in Spotify's in-house studio, as well as a live performance initiative that it will host on its platform.

But so far, the major players in the Western streaming world have resisted moving in on the labels' territory. Saavn, clearly, does not have the same reservations.

"Labels are our core partners, and they always will be, and I think that's true of any music streaming service," Malhotra says. "But I think music isn't only about libraries, it's truly about moving people. [India is] a country that has been heavily pirated over the last 20 years, and now Saavn has become a legitimate platform for labels, artists and users. So this coming year is about two things: growth and delivering a sustainable economic model for this country. And I believe we're delivering in both cases."