India’s music industry faces challenges in monetisation despite high consumption, focusing on subscription models, diversified revenue streams, AI influence, and simplified licensing to build a sustainable ecosystem.
By Karan Taurani & Kumar Taurani India is among the world’s largest music consumption markets, yet monetisation remains disproportionately low. The music industry is increasingly moving towards subscription-led monetisation. According to the International Federation of the Phonographic Industry, global recorded music revenues reached $31.7 billion in 2025, with paid streaming accounting for over 52% of revenues.
India, however, remains fundamentally different. Affordable internet access, smartphone penetration, and free digital platforms have ensured that the challenge is no longer increasing listening hours. It is improving monetisation per listener. But excessive dependence on a single advertising-led ecosystem creates structural vulnerabilities for music labels. Advertising yields, recommendation algorithms, revenue-sharing arrangements, and platform policies are largely outside the control of music companies.
The solution is not to reduce YouTube consumption, but to reduce the industry’s dependence on it for incremental revenue growth. Music labels must diversify distribution, develop stronger relationships with paying consumers, and expand commercial licensing opportunities. Streaming platforms must work towards expanding the paid music ecosystem rather than competing mainly for free listening hours. One potentially transformative opportunity lies in tie-ups between music streaming platforms and the digital commerce ecosystem.
Spotify could collaborate with Blinkit, Swiggy, Amazon, Flipkart, and other consumer internet businesses to offer music subscriptions bundled with memberships, loyalty programmes, and purchases. These could significantly expand consumer reach, reduce customer acquisition costs, and introduce paid music to consumers who might otherwise never purchase a standalone subscription. Telecom operators, payment platforms, and financial institutions could play similar roles.
India may require a fundamentally different pricing architecture from developed markets—platforms could experiment with Rs 5 daily passes, Rs 19 weekend packages, Rs 29 weekly subscriptions, or affordable mobile-only plans. Even modest improvements in paid conversion across a large base could expand revenues, given the economics of customer acquisition, payment processing, and retention remain sustainable.
AI will increasingly influence how users discover, experience, and interact with music. AI-powered recommendations, multilingual search, mood-based playlists, and personalised listening experiences could improve engagement while extending the commercial life of catalogues. For labels, it creates opportunities to monetise older soundtracks, regional catalogues, and independent artists more effectively.
AI could also improve content marketing, audience targeting, and royalty analytics. But generative AI presents challenges on copyright ownership, synthetic voices, and unauthorised use of recordings. The industry must establish licensing frameworks that ensure rights owners are fairly compensated. Restaurants, cafés, hotels, shopping malls, gyms, retail stores, salons, weddings, and organised events represent substantial commercial music consumption opportunities.
Yet licensing remains fragmented, compliance is uneven, and collection mechanisms are often complex. Music companies and collective rights organisations should collaborate with large retail chains, QSR operators, hospitality firms, and commercial property owners to introduce simplified, standardised licensing arrangements. India has already built one of the largest music-listening ecosystems. The next decade must focus on building one of its most commercially sustainable music industries.
The opportunity is not simply to make Indians listen to more music, but to create an ecosystem where every stakeholder benefits from making music more valuable. Series concludes The writers are Respectively EVP, Elara Capital, and Chairman, Tips Music. Disclaimer: The views expressed are the author’s own and do not reflect the official policy or position of Financial Express.
