Sony Music (India): Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Sony Music (India): Case Solution

Analysis on Background of Sony Music:

Sony music is a global recorded music company, as well as it isa wholly owned subsidiary of Sony Corporation of the US. It is a US-based record company founded in 1929, after many mergers and acquisitions and buyout of Columbia Broadcasting System (CBS) by Sony Corporation of America to establish Sony Music.

Sony media entered the Indian market in 1996, with the motive to participate and grow its market share in the local music market.It debuted successfully with a song “Maa Tujhay Salaam” in 1997 and When Yash Raj and UTC entered the market,the competition increased gradually.

Sony was not adversely affected in a competitive industry, since it had a list of successful hits in films such as Kal Ho Na Ho, Kuch Kuch Hota Hay, and Lagaan, for expanding its market share in a competitive industry. Moreover, the company’s aim is towards progressive growth targets. By aggressive growth approach, Sony expanded its market share from 5% in 2002 to 10% by 2007; its initial focus was on core business and gradually became a leading music and video company in the industry.

While other companies were focusing on film production, Sony focused on Bollywood music. In 2010, Sony wanted to expand faster, therefore it moved towards growing market like Chennai, so it opened its office in Chennai for producing Tamil music as it had high demand that time, and later on by 2011, Sony music became the music leader in India with over 25% turnover of market and 65% of Tamil market, and its plan to invest in Tamil market was an excellent decision by the company.

In 2009, Sony partnered with IODA (Independent online distribution Alliance) to provide ease to the Indian artists by connecting them to blogs, social networking sites, and websites, which helped the artists to digitize their contents and brought almost 50000 songs to the channel.

As it can be seen in Exhibit 9, Sony’s physical and digital presence was significant by over 40%, which shows that Sony had a strong presence on Facebook with million of fans on its page. Afterwards,the company launched a Tamil-English song named “Kolaveri Di”, which became viral with over more than 40 million views on YouTube.In addition, the company filed for trademark of Kolaveri Di.

With recording as its core area, the company’s aim was to get 35% market share by 2015. Its plan was to grow its revenue by over $50 million in the next three years.Moreover,global digital trend is to transform its strategic model from physical to license and service based, which is a suitable strategy for growth in this competitive industry.

Impact of Digitization:

The music industry comprises of four functions, Physical Sales, Digital, Radio and Television Broadcasting royalties and royalties from public performance.

By the year 2010, the digital sales surpassed physical sales as physical sales were 81% in 2006 and in 2010 there was a significant decline to 38%. In 2009, the budget of physical sales was 4.5 billion as compared to 3.2 billion in 2010, which decreased by 28% which indicates that the industry is moving towards digital business.

Digitization has a greater impact on Digital sales as people use internet and mobile frequently due to which its sales increased by 57% which is a drastic increase and this is an indication for future growth, as it can be seen that physical sales were decreasing due to technology advancement.Sony Music (India) Case Solution

In India, the digital segment was expected to be the second largest contributor to the music industry, as it can be predicted that people used mobile phones more for music rather than PC. There were 548.7 million active users of wireless service in India, which is a huge amount with respect to future potential in digital business......................