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Flipkart Launches Digital Music Store 'Flyte'; How Does It Compare With Amazon & More

Flipkart has launched its online digital music store called Flyte (one of the first such e-com players to do so), and claims it is India's largest legal online music store. The e-tailer says it has the largest catalogue of music available online in the country with over a million tracks from 150,000 albums available across 55 languages and 700 genres and sub-genres.

Singles are priced at Rs 6 and above while albums will be available for download starting at Rs 25.

As of now, users can purchase music through the Flipkart.com website and the Flyte music app only within India and users have the option of listening to a 30 seconds clip of any song (free of cost) before actually purchasing it.

Sachin Bansal, Co-founder and CEO, Flipkart said, "We had maintained that making Digital content available was one of our focus areas and this launch marks our first step in that direction. An online music store made sense given the wide appeal this category enjoys in the country."

"With Flyte, consumers in India will now be able to download a wide range of music legally and at an extremely reasonable price. With music available across 55 languages and 700 genres and sub-genres – this is a service that should appeal to all age groups and music lovers," added Sameer Nigam, VP, Digital at Flipkart.

Currently the company is not offering a full-length music streaming option(similar to Amazon), therefore users will have to purchase and download the track before they can play it on their devices (mobile phones, PCs, Tablets, car stereos etc).

Users can browse songs by languages that include Hindi, Sanskrit, English, regional languages like Tamil, Telugu, Punjabi, etc and also foreign languages like Nepali, French, Italian, Spanish and Swedish. They can also browse songs in a range of genres like Hindustani, devotional & spiritual, ghazal, Sufi, jazz, blues, rap & hip-hop and instrumental, among others. The different categories include bestsellers, Bollywood hits, International hits and regional hits. New albums are showcased on the home page along with featured albums, most popular tracks and most popular albums.

All digital music downloads are available in Digital Rights Management (DRM) free MP3 format which means that the MP3 files that users purchase will not contain any software that will restrict the usage of the file. The company claims that 99 percent of the songs available on the store are available in CD-quality (320kbps bitrates). By default, the songs are encoded in 128kbps but users can also choose to download songs at 320kbps or 64kbps bitrates.

Users will have to login with their Flipkart user ID and password to purchase and download digital music from the site and they can purchase using any of the standard payment options available on the website that includes credit cards, debit cards, Internet banking and gift voucher, although Cash On Delivery (COD) has not been made available (which makes sense because of the small size of the transactions). Additionally, users can also use their Flipkart wallet (which can be preloaded with currency) to pay for their digital music purchases. Also, once an order is placed, it cannot be cancelled.

All purchased songs are automatically added to the MP3 Library and users can download their songs anytime, on any Internet enabled device, although the songs can only be re-downloaded a maximum of three times after the initial download. The company has also provided a 'Download Manager' which is a desktop application with which users can choose to pause and resume file downloads.

Pricing Strategy, Flipkart vs Amazon & Music Download Competitors:

We noticed that the prices of the albums that are available for download are cheaper than their CDs or DVDs. For example, you can purchase the entire Rockstar movie album for only Rs 113 whereas the movies audio CD costs Rs 149 (that too after a 15 percent discount). Similarly, upcoming Bollywood movie Agent Vinod's album is available for download at Rs 143 while the audio CD costs a little more at Rs 169 (after 15 percent discount).

When we contacted Flipkart to shed more light on this, Ravi Vora, VP, Marketing, Flipkart.com said, "The costs automatically differ depending on the platform through which music is made available to the customer. Digital music is a more efficient form of music distribution, cutting down on manpower, shipment and packaging costs. This automatically gets reflected in the price difference between physical and digital formats of music."

But this is not something exclusive of Flipkart, rather the e-com player is following in the footsteps of e-com giant Amazon(www.amazon.com) that also offers downloadable albums at a lower price in comparison to an audio CD(though we did spot few exceptions where the CD prices are almost at par or cheaper than album downloads). But while Flipkart has just entered the digital content market with its online music store, Amazon launched its own online music store around 4 years ago.

Amazon launched a public beta in 2007 where it offered 2 million songs for download. Today, as a full fledged product, it offers 18 million songs, which is huge. However, one area where Flipkart scores over Amazon is allowing users to redownload, unlike its global counterpart. But at the same time, Amazon offers two modes of saving the music files as against the plain old direct download to the computer that Flipkart is offering, as of now. Amazon also allows users to save in Amazon Cloud Drive.

Indeed, cloud storage for consumers is still at a nascent stage in India but we would expect Flipkart to soon come out with a similar option. The question is would Flipkart just go ahead buying some small Cloud storage firm(it has plenty of cash to do that) or just use the services of one to roll it out.

On another note, the company will now give a tough fight to telecom operators in the mobile space who are big players in the digital music market. Last we checked, Vodafone was offering popular songs for download at the price of Rs 25 per song (which is much higher than what Flyte is providing), while the full album in available for prices that range between Rs 50 to Rs 99. Some others are offering single song downloads at Rs 15 each.

The telecom operators have an advantage with an easier payment mode as the downloads are charged to the phone bill(as a value added service in case of post paid connection) or is deducted from a pre paid balance. But, we would still expect Flipkart to shake up that market and eat into the music download revenues of telecom firms. How much? We will get to know soon.

Having said that, although movie and music piracy is rampant in India and very few people buy original digital content (the general consensus is why buy an original for Rs 500 when we can get it for Rs 25 from a local vendor), this could be a good step since the government is finally taking steps to curb piracy in the country, one of them being the ban on music sharing site Songs.pk in India by the Calcutta High Court.

An Update On Flipkart's Daily Revenues:

Flipkart.com is India's largest e-commerce player for physical goods and according to the company, it gets more than 12 million visits every month. Its revenues have grown from Rs 50 crore (FY 2010-11) to Rs 500 crore (projected for FY 2011-12). But what caught our eye is the company saying right now it is clocking close to Rs 2.5 crore as daily revenues. This translates into monthly revenues of Rs 75 crore and at this growth rate it should hit revenues of over Rs 1,000 crore in the year ending March 2013.

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