Interesting question. I think in the concall, they mentioned that songs of top stars is expensive but the marketing cost on their part is negligible. However, songs from unpopular artists, although good, needs more marketing expenditure. While it would be definitely worthwhile to know how much they spend to acquire a Badshaah song over, say, a folk song, but for me, even if they don’t tell, I would be fairly comfortable if all music is bought from internal accruals and their margins don’t fall.
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These are closely guarded trade secrets. No we don’t know this.
At a per song level, we cannot. Overall guidance for this section is pay back period of 4-5 years. Given that growth guidance is 22-25% and given that all 3 segments are funded by internal accrurals we can estimate further that management estimates 22-25% roic for their investments.
No what they said is they won’t get into expensive movies. Didn’t say anything about songs exception that they plan to aquire 20-25% of all new songs. I’m sure they have ways to estimate payback periods at a per song basis depending on data analytics. This song is right now very vital on tiktok instagram YouTube. Music had lot of reuse remake repeat listen value as opposed to movies which one typically only watches 1-2 times. Both have different dynamics. Ok to aquire expensive songs as long as one is not overpaying. Industry insiders might have some idea, but difficult for investors sitting at home to estimate. What we can do is analyze and judge at aj aggregate level, what value management actions create.
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If there is a high potential value for these songs wouldnt the the producers of the music become wise and start charging higher rates for the music leading to the music producers taking a larger value in the value chain
I think all stakeholders in the value chain are interdependent on each other and no one seems to have an upper hand ( as of yet ).
A producer is no good with out a catalog/ content owner who in turn rely on the OTT players for the reach. A producer will prefer the large catalog player and so will the OTT player. Now a producer can directly go to the OTT player but do they really stand a chance to bargain based on one potential hit song ?? I don’t know think so.
Time will tell who stands to gain the most in the value chain but for now, all of the players needs each other and can co-exist without anyone particular player getting the higher share of wallet IMHO.
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Yes,
Just an accessory, I guess. Cross-sell opportunity. Also, many people have the habit of buying original earphones once the earphone supplied with the gadget wears out.
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I have a question on the content rights. Saregama is publishing the Roza serial on their Youtube Channel, the Roza serial is getting aired on SunTV but SunTV is not publishing it on their Youtube channel.
Does Saregama has given the rights to SunTV only for publishing on TV and not for Digital channel for Roza serial?
If that is the case they can publish many serials in future and keep the Digital rights with them to earn more revenues.
Disc: Only tracking investments
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yes…the rights are sold differently
as per the best of my understanding (i remember Mr. Vikram Mehra specifically mentioning this in the last concall)
The contracts for satellite broadcasting and digital are done seperately….
sareagam owns the IP for all content it creates and has the potential to stream it on its own youtube channel and facebook and gain additional revenues via advertisment.
This is what actually makes this business a good one to own.
The reach is infinite…all thanks to internet and social networking. and smartphones
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Sharing few thoughts on YouTube channel of Saregama:
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Since the song is owned by Saregama, doesn’t that also mean that Saregama will make money even in case somebody plays a Shemaroo video song on Shemaroo’s youtube channel? Isnt it actually a win-win situation for Saregama?
Nope. Shemaroo will have the sole right to music video. So there will not be any payment in this regard to Saregama ( for old songs). However if the music is recreated in any other form, saregama will have copyrights
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No, Saregama won’t be earning on the Music Video which Shemaroo owns because around 2000 music used to be sold in different way. There would two parties: one who get music video rights (Shemaroo) and second the music audio rights (Saregama).
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In this scenario, how does the audio part work? Does that mean that Shemaroo can only play Video songs and not the Audio only songs? e.g. can Shemaroo play their video song (without video) on Spotify/ Amazon music (which dont have video feature)?
It may be a stupid question, but I want to understand the revenue split. Does Shemaroo always have to play a video to earn the revenue?
No, Shemaroo can’t play their song on these apps as they own the video music rights (Not sure about YT music because their concept is different). If the song is being played anywhere except in the original video Saregama will be getting the revenue, for their old songs.
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Was going through a trend of music consumption and was surprised that music construction has gone through roof.
While Paani Paani song keeps buzzing with 278 M views in one month, what is to be noted that associated reels ( short videos/dance covers) etc. are also getting so many views. When I say view means ONLY You Tube. There are so many other audio apps, where same content is played.
Another development, New Guru Randhawa song get 67M views in one day. I never see such a view for a song.
Strong industry tailwinds. Just need to make sure by saregama that they do not overpay to artist.
Disclosure: Invested
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I guess some of us don’t know that many of these youtube views are actually Paid views.
Yes sanjeev, buying views is applicable to all platforms including Youtube. However, it is for new content creators, who want some views to pass the basic algorithm. I do not believe saregama need this after having 21 Mn subscriber. 
Disclosure: Invested.
What is the revenue recognition price Saregama when they sell one unit of a Caravan?
If we assume it is 5000 (MRP is 7000, so deducting margins for channel partners), then below is the split between streaming and caravan revenues in the past five quarters. Streaming revenue seems to be up and down, which is strange in this kind of a busniess model. Not sure what I’m missing.
| Q1 21 | Q2 21 | Q3 21 | Q4 21 | Q1 22 | |
|---|---|---|---|---|---|
| Music revenue (Cr) | 69.6 | 100.4 | 114.2 | 101.3 | 91.9 |
| Caravan units ('000) | 15 | 81 | 138 | 110 | 45 |
| Caravan revenue (Cr) | 7.5 | 40.5 | 69 | 55 | 22.5 |
| Streaming revenue (Cr) | 62.1 | 59.9 | 45.2 | 46.3 | 69.4 |
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You actually dont need to assume. You can get exact numbers by considering FY21 numbers. We know music streaming, carvaan sales, music segment sales so carvaan sales.