After acquiring big ticket titles like Kabhi Alvida Naa Kehna, Rang De Basanti, Guru and now Saawariya, Sony BMG’s focus is to reach an indomitable position in the world of music.

This apart, the company has major expansion plans under its belt, ranging from co-production, artist management to routing in regional music.

In an exclusive chat with Businessofcinema.com, a low profile Subramanium gets talking about the company’s business model, expansion plans, new found strategy, past disasters and Saawariya amongst others.

Excerpts:

Why has Sony BMG been so choosy in the Hindi film music acquisition space? Can you elaborate on the company’s strategy in the Indian market?

Let’s go back to our history. We were the first foreign company to set up a music company in India. In those days Manmohan Singh was the Finance Minister and his query was that while foreign money coming in was important, why do we need it for music? There were certain conditions, which we fulfilled before setting up the business here. We cleared assurances of being transparent from where the cash comes in and encouraging Indian talent. The first Hindi non-film project we did was A R Rehman’s Vande Mataram.

Consequently, the first film we did was Karan Johar’s Kuch Kuch Hota Hai. It became a massive hit overseas. That was the time we started doing select hi-profile films. And even today we continue to be very selective with the movies we do. I am not saying that we don’t do bad films. If one looks at our background, we have done Ashoka, Guru, Rang De Basanti and KANK, these are landlord movies.

We tend to release four to five Hindi film albums along with five Indi-pop albums a year. In some senses we are a boutique, which defines us as being selective. We like to work with people with whom we can build a long term relationship. We don’t want to be a factory releasing music every week, where something works while others bomb. It’s a passionate business for us. There are people who tell us that we say ‘no’ more often than we say ‘yes’. But it’s okay with us. We want to stick to this strategy. It has been relatively successful. Definitely the industry witnessed the ups and downs; many people have come and gone, but I would like to believe that we have been consistent.

Has this strategy worked against Sony BMG?

Definitely, it has. There are no two ways about it. In this industry there are two strategies one follows. One is, when you try many things thinking something might work. And the other is the sniper approach – a well targeted and aimed move. We fall under the latter bracket. The problem with this approach is that you rest your future on a movie like Saawariya, which may or may not work. It’s all luck. There is a downside to it as well. Some films didn’t work for us.

Which films are you talking about?

Farhan’s second film, Lakshya. We took it up because he made a Dil Chahta Hain, which had amazing music. Then we acquired Mukta Arts Kisna that bombed. So, for those 18-20 months, we had a spate of movies, which didn’t work. We were in a fix. But, in hindsight we believe the names behind these films were brilliant, it’s unfortunate that the music didn’t click with the listeners.

For instance after Yuva no one would have touched Mani Ratnam. But I believed that he is a great director, so we bought the rights to Guru. < Page Break >

Then how do you balance this upward and downward graph?

The graph has been up till now. What happens henceforth is a different story. The idea is to work with people we have faith in. Even they shouldn’t feel that we are paying them money and just doing our job. At Sony BMG, we work with passion. So we are not changing our strategy as such.

But now that new players have stepped in the market, what’s the scenario?

The scenario has certainly changed, but how? Earlier individual production houses would make films and music labels would acquire the rights. Now we are witnessing an emergence of studios… like we have Yash Raj and T-Series. They take care of everything. So where we used to eye 80 films a year, suddenly it has slashed down to a small number. So the music business has not changed, the film business has.

In this case, where five big houses are marginalizing music companies, we are left with two options. Either we part align to a production house, possibly with Sony Pictures or Sony television, wherein we form a vertical or something like Tips or T-Series. So, there is no independent music company left, except us. People now think that there is no money in the music business.

Having said that, to answer your question – the music landscape has changed.

What are Sony BMG’s plans on the anvil?

There are big plans. When our top officials were down here to decide our next move earlier this year, they figured out that the Hindi music market is too small. That’s when we decided that we need to tap the non-Hindi music. After Hindi, Tamil music is a big hit and then comes Punjabi. We plan to set up our new regional offices soon. One will be in the South, which will take care of the Tamil music and the other will be either in Delhi or Chandigarh for Punjabi music.

Other than that, we are opening up an artist management division. Like we have a few companies in the west, which manage big stars, we will be piecing together a huge infrastructure for this. This will not be limited to actors, singers or models but will extend to writers, lyricists and video directors who are in and around the world of music. It is a big step for us.

We will be actively considering films now and are evaluating potential partnerships in this business. We need to strike strategic alliances with production houses. So, co-productions and co-funding is definitely on the cards. We have good relations with a few production houses like Karan Johar’s Dharma Productions. So if and when we strike a deal and if they have plans to produce a slate of films in a set span of time, we will buy out the music rights of all. Hence there will be a continuous flow.

In terms of investment, the most simplistic way of putting it is that we are doubling our investments next year. Our aim is to be No 1 and it’s a short term goal. And we will put in whatever it takes to reach that position.

What about international artists’ alliances?

The idea is to become agents for these international artists. For instance, Shakira and Beyonce. We will negotiate with their agents and get the deal. That’s the open opportunity for everyone. Concert promotion business, which is at a nascent stage in India, is the second thing we are eyeing. We need to go through a whole lot of things to get that done, like licensing and permissions. Our interest is in managing.

Also, merging Indian artists with the international ones is on the cards. Gone are the days when Indians wanted to work with international pop stars, now it’s the other way round. It’s a massive change. < Page Break >

Indian music companies are exploring the internet to market their music. What is Sony BMG planning in that space?

Internet is a huge medium. Are we interested in putting up are music on the internet? Yes. Are we interested in becoming shopkeepers online? No! Not yet, rather.

There are many issues, which have to be sorted out before we tap that. Also, broadband has not taken off that well. We may look at a richer format a little later. We want to have internet presence.

What has the response to Saawariya been?

I was just stunned by its response. I have absolutely no words to describe. It’s been years to see this kind of a response. The last film was four years ago, Kal Ho Na Ho, which managed to create a hysteria in the music world. I was shocked to know about this.

I personally thought that it would sell, but after the film released. Reasons being, the music is slow. We released five lakh copies and after two weeks, the demand has been the same. It’s No 1 everywhere. It has received raving reviews all across the globe.

What has Sony BMG acquired after Saawariya?

We are in talks with many and have signed a few. We have acquired the rights of three films under the Vishesh Film banner, which will happen over the next two years. One is Jannat and the other two are in the pipeline. Karan Johar is like family. So we will do his next film as well. But other than Vishesh Films, we haven’t signed anything else.

What about the OSO-Saawariya music conflict?

Oh! That’s just music hype. But the point is that people are walking into the stores to buy either of them and end up picking up both!

What has been the turning point for the Indian music industry?

I think it is the music company association – IMI (Indian Music Industry). We have had a lot of fights, which we have won eventually. The first fight was with radio channels. They don’t pay us for playing our music; the case is still going on. Same thing happened with the telecom companies. What is a ringtone? It’s a song, which we are making. So that was another fight.

Then there are public performances, which play our music. Television channels play our music, especially the talent hunt shows. They are making Rs 300 crores by advertising our songs. Who allowed them to sing our songs? But there’s one channel, which doesn’t want to pay us. So that case is on.

Hence the coming together of all these music companies and battling against these unjust practices has been the turning point. The Indian music companies used to make around Rs 8 crores a year earlier, but now because of these lawsuits we make Rs 100 crores a year.

A decade of existence in India. How has Sony BMG evolved as a company over the years?

I think we are a great blend of experienced yet universal flesh. We have not lost our personality, character and identity. You ask anyone about Sony BMG, I would like to believe that they will have very nice things to say about us. And I am glad we have retained that personable and likeable company. People will come to us first. That has not changed.

When we came in everyone thought that we are a very international music oriented company, that image has changed. People now take us as an Indian music company.