After being in the industry for almost two decades, Big Music CEO Kulmeet Makkar has perhaps seen the changing face of music business in India more closely than anybody.

Since its inception, Big Music has followed a cautious well calculated strategy - acquiring some top grossing titles like Johnny Gaddar and Rock On and the home video rights of Jodhaa Akbar - which went on to win many acclaimed awards. Now the label is all set to launch its publishing arm in a big way, with one eye set firmly on the digital space.

In this, the first part of an exhaustive interview with Radioandmusic.com's Chirag Sutar, Makkar speaks on the changing trends, expansion plans, 'BIG' catalogues, Strategies and future projects... read on!

Since its launch two years ago, where is Big Music positioned today?

We started almost two years back, in May 2007. Our business model was really to work on music and home video together – music more on the digital side and home video more on the physical side – this is the way we have progressed.

We have acquired a lot of content, especially in the home video section and we are working with top international studios like Warner, Universal and Paramount. Apart from that, we are acquiring a lot of domestic content – â€?the big ones' –  we are not into the â€?catalogue low price market' because we really want to buy blockbusters – that's where we have to justify our brand called BIG . We want to build a catalogue of great songs, not of buying labels. We will further use that catalogue in a period of four to five years on radio, mobile and internet.

We have hits like Welcome, Singh is King, Jodhaa Akbar , Rock On and Ghajini which we recently released – at the same time, we pick and choose film music where ever we find – music which is viable and also which has a long term value.

In the last two years, we have set our direct distribution network on digital platform. Our content is uploaded on across the world – we are online on 370 sites in about 43 countries. Our content is uploaded on mobile, and internet in worldwide markets. On mobile front, we are dealing with Airtel, Vodaphone and of course, Reliance.

So you are not working with content aggregators or mediators like Hungama, Mauj?

No mediators. We used to work with them, but now we deal directly. It works better because if product works, we make a lot of money. Second, we can do a lot of marketing synergies – now is the time for partnership marketing – we are not into trading, we don't want to do business of buying from producer and selling it off to third party – we want to work as a partner, so we involve mobile players as a partner to market it. We do a lot of marketing tie ups with mobiles and also a lot of promotions on radio – we do not believe in treating radio as an enemy. For us, radio is as important as any other platform – they are a revenue source for us – at the same time we use radio for partnership marketing.

On radio, would you only work with Big FM because of the obvious synergies?

For us, Airtel and Vodafone are as important as Reliance. Similarly, (Radio) Mirchi or (Radio) City is as important as BIG fm.

Do you get good response from other players?

Absolutely… that's the best thing about Reliance Entertainment. We work on a arm's length within divisions and there is no compulsion that Big Music has to do a Big Pictures' film – if Big pictures gets a better value, and it's viable, then we are open to selling  it – if it's not viable, then we refuse.

Can you tell us more about the online venture of Big Music...

Currently, the website is only for partners – one can understand the genres or see our catalogues. Besides that, we are providing online shopping option for the video purposes   We have at least 10, 000 titles. Today, if someone goes to a retail store, people don't even get to see the range. I think, at least on the site, one can see the range and you can order a home delivery.

In coming days, we will convert the B2B site into a sell through B2C model. We want people to download music and content – it will be a subscription model or a pick and choose model – we are working on that yet.

You have mentioned earlier that this website will be an advertising driven model…

Nobody pays for music today. We also feel nobody would like to use a credit card to buy a song for 10 rupees – it's a very small amount to be paid by credit card  so we are working on a model where the consumer gets the music free, but we have partners on our site who are willing to fund it. The other model we are working on is where a consumer can pay once and is allowed unlimited download for a year or six months – that model is being cracked.

Do plan to do the same for mobiles?

The issue with mobile is that it involves players, it's important that the mobile operators business models should syndicate – mobile may or may not be in our immediate plans  But yes, we are looking at this area – if you ask me, mobile would be more flexible because they will make money only through value add services – ultimately, voice is going to be free and it's data that will add value.

Online websites by music labels have not worked so well in the country…

It's very difficult to work a site if you start charging for a download, you have to work out a model where the consumer either gets it free or gets it at a price where he doesn't mind to pay – you have to work on volumes rather than a price per download. We want to create a site for the future, we really want to understand what model to follow –   there's no point in replicating websites tried by other labels – it doesn't work  i-tunes is the only successful model where they managed to do it well.

Apparently, i-tunes is also going DRM free…

Everybody is settling on the DRM issue. We have to figure a model where you take the consumer along.

How big is your music catalogue?

The music catalogue is currently small. We haven't acquired much because of the transition that is on in the music industry. We want to take time to understand what kind of catalogue will work. We have acquired new content and did quite a few films in the recent past which have done reasonably well.

Are you investing in regional music?

Not really … we are not investing much. We have acquired some content in Bengal and in the South. In Bengal, we have invested in music as well as home video - we have acquired the Satyajit Ray collection. There is some decent content we have acquired in Punjab as well.

Rock on reached on no. 13 on i-tunes, but you don't seem to be happy about it…

You don't get great amounts from them. If the consumer is getting the same content for free, there is very less chance that it will work. In the physical space, we can package it differently – we add a lot of material which the pirated CDs won't have – but on the internet, it's a challenge – how do we convert the download into a legible download?

It's not that consumers in India don't know that the music is pirated, but for them, the value is so small – they don't treat piracy as theft. In their mind, theft is theft and piracy is �OK' – look at the video market, a film releases on Friday and on the same day pirated copies too are available.

How has Rock On's home video fared?

Rock On home video has done extremely well, and it's one of our bestsellers. First, it's a kind of film you can watch again and again and in home video, the formula is that you can incorporate many things like uncut scenes, behind the scenes, interviews etc. Besides Rock On has a value – whether you watch it in parts or in continuity.

How many units did you sell?

In terms value, our retail value for films would be anything between Rs 30 to 40 million.

You also plan to start Big's publishing arm, tell us more..

This model is about recognising composers' and lyricists' rights. We'll be making them partners in revenues. As I said earlier, in music what is happening is that there are different platforms and we keep changing the way music is consumed. First, it used to be physical, then mobile; there are various other mediums, so there are 100 different rights that exist in music. BIG's publishing arm gives revenue shares to these composers and lyricists wherever they come from.

First, we sign up a composer and then we protect his rights and then we license those works that he creates to a film, so producers can use the song in a film for the film purpose and the music company can use his work for the sound recording purpose but his original works remain with the publisher.

How do you sign-on a composer?

Either the composer can work on a one off project or you can sign-up a composer for life  In fact everybody thinks this is a wrong model to follow, and why should one give more to the composer – but in my opinion, if the composer is not happy, the lyricist is not happy, then you can't expect great work. So, we need them to be partners in the upside – if they are creating a super hit song, they should make a lot of money – why not? Composer is our â€?annadata' and radio is our friend â€“ so we have to make him happy. This model is yet to be formally launched, so you will come to know more  soon...

Who have you signed so far for the publishing arm?

We have signed up SEL (Johny Gaddar, Sikandar, Rock On),  we licensed tracks to BIG pictures to use in the film through the publishers arm. Earlier, we had signed A R Rahman for Ada - that again was a separate deal of this kind.

A year ago you mentioned you plan to revive Bangla music – Ravindra Sangeet especially. How far has that come?

We have started that, we did a couple of albums in Bangla, but unfortunately, the way the market was in the last six months – we have kept that on a back burner. For now, we have changed our focus into the video segment in Bangla but we'll come back to Bengali music because it has a very very strong heritage.

Ravindra Sangeet is not covered under the copyright law anymore so anybody can work on it – it's in the public domain. Anybody can come and sing Ravindra Sangeet – we are now working on how to bridge the gap with the younger audiences  Ravindra Sangeet is still seen as the older generation' music, however, its lyrical value is very strong, we need to contemporise the melody part of it.

For marketing, you are also targeting malls and not restricting to music chains..

Video as a format is a family purchase. Unfortunately, in India, everybody used to ride on music distribution to sell video which is very wrong because music is a individual purchase, whereas video is family buying. Our entire distribution strategy has been shifting away from music distribution to non traditional distribution – you go to Big Bazaar, Magnet, Food Market or Gini and Johny – we are distributing the content keeping in mind the right TG for that video and this is a very successful model in world market. In US, for instance, Walmart is the largest retail chain –  video business will grow only of you reach the right distribution model.

What about the music, are you working on similar strategies?

Unfortunately because of the format issue, there's no point in focusing on that – it's not a distribution issue – its a format issue – that's why we are trying to do a lot of innovation with radio, online, mobile and downloads…

How much revenue comes from digital?

Two thirds of the music revenue comes from digital, especially when it comes to new content. The old content still might not be relevant  Now with 3G coming in, mobile can have embedded content too. Mobile is a single screen market and music is a huge value add. It's no more just a driver - nothing works without music. Revenues from mobile, radio, licensing, television are huge. Our focus would be essentially be digital...

What are the forthcoming projects of BIG?

We have Kal Kistne dekha, Do Not Disturb by David Dhavan, Sikandar there are 16- 18 projects in next 12 months in two three languages that includes Tamil, Telagu, Bengali and Punjabi.