Vodafone Idea plans music streaming service to take on rivals

Vodafone Idea Ltd plans to launch a new music streaming app to challenge Bharti Airtel’s Wynk Music and Reliance Jio’s JioSaavn. The existing Idea Music app will be shut down.

This is a significant step for India’s largest telecom operator by subscribers and revenue, as it tries to retain better-paying subscribers on its network and drive data consumption.

“We are sunsetting the Idea Music app and we will come up very soon with an offering that will provide the best-in-class music streaming services, through a partnership that we are in the final stages of closing,” Balesh Sharma, chief executive officer of Vodafone Idea, said in a post-earnings conference call with analysts.

“We will keep you posted on this but music is a big priority for us and we will work on that as well through partnerships,” Sharma said. Idea Music has a library of more than 3 million songs from across the country and overseas. The upcoming service will see strong competition from Wynk Music, which already has 100 million users, and from JioSaavn, which Reliance Jio claims is South Asia’s largest streaming, entertainment, and artist platform. Other players in the music streaming market are Gaana, Hungama, and a few international players such as Apple Music and Google Play Music. Competition in the segment could also heat up with the expected entry of Spotify in India by March.

“If Vodafone Idea is looking to partner it could be with Gaana as the other players are small in user base and offerings,” a Mumbai-based analyst said seeking anonymity.

An email sent to Vodafone Idea seeking details about the partner was unanswered till press time. A spokesperson for Gaana, however, said it was not looking at a partnership with Vodafone Idea.

Stepping up music and content play has become imperative for telecom operators as they fight to retain high-paying subscribers in a low-tariff market. Bharti Airtel’s and Vodafone Idea’s revenues from wireless business dropped after the entry of Reliance Jio in September 2016 as they were forced to match Jio’s rock-bottom data prices. Bharti Airtel’s profit plunged 72% to ₹86 crore in the fiscal third quarter from ₹306 crore a year earlier, while Vodafone Idea incurred a net loss of ₹5,004.6 crore last quarter, compared with ₹4,973.8 crore in the preceding quarter.

All telcos have boosted content offerings. Reliance Jio aims to focus on producing in-house web series and shows for its subscribers, and has non-music audio programmes that range from Bollywood to comedy, and storytelling to cricket on JioSaavn.