Music rights as part of package deals is a positive trend, say industry experts

The larger benefit is that music companies can use the producer’s brand name and the producer himself is assured of a secure business .

- Vashu Bhagnani

Ever wondered why music companies have been buying music rights as part of packaged deals? While Universal acquired the music rights to a set of Bharat Shah’s movies for an undisclosed amount, Saregama decided to pick up five movies to be produced by Vashu Bhagnani for an unprecedented Rs 25 crore. The question being asked is what does this mean for the film music industry? Has this set in motion a trend whereby music rights for movies will henceforth be sold as a package? Yes, thinks Shridhar Subramaniam, director-marketing, Sony Music. "It is the clear start to producers becoming organised mini production companies," he says. The advantage, he explains, is that producers will get funding upfront and will be able to work on several projects at one time.

For the music company, clearly the advantage lies in the fact that they can negotiate the best possible rates. Subramaniam predicts that there will be a transformation from the concept of home banners to full fledged corporate banners. This gains significance in the wake of production houses being listed and several of them at various stages of planning their public issue. Vashu Bhagnani’s Puja Entertainment is one such case. "Our deal with Saregama has worked well for both the parties," says Bhagnani. He says deals of this nature will only pave the way for a stable long-term relationship between the music company and the producer. "The larger benefit is that music companies can use the producer’s brand name and the producer himself is assured of a secure business," he adds. According to a media analyst, film producers have always had relationships with music companies. He cites the cases of Yash Chopra with HMV and Subhash Ghai with Tips. "The advantage in a package deal is that it reduces the inherent volatility in the business and makes long- term relationships possible." he adds.

Says Harish Dayani, executive director, Saregama India, "I do not see a clear trend emerging." On the deal with Vashu Bhagnani, he explains it was mutually beneficial and his company was open to more deals of this nature. While pointing out to the risk factor, he says the objective is to balance it out. "Eventually, it is a question of speed, quality and delivery," he adds. Some industry observers, however, believe things are not as easy as that. While admitting that investment planning, scheduling and date fixing become easier, they remain sceptical about the deal lasting out. "The advantage lies with the producer," they say. While it remains to be seen whether the trend lasts in the long run, the net fallout of packaged music buys is undoubtedly the fact that these deals will play a substantial role in the corporatisation of the film industry.

Krishna Gopalan

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