December 5th, 2012 was a good day if you worked in the recording music industry in Indonesia – well, at least, considering the doom and gloom that hung over the industry players recently. After over a year since the so-called Black October happened, Indosat, XL Axiata and 12 of Indonesia’s largest music labels, launched a major initiative to support ringback tone sales. The program integrates the promotion of ringback tones of both telcos, formerly using separate dial-in numbers, to a single code applicable to both telcos, and also combines the promotion efforts – and marketing money – done by both telcos. The telcos are now investing heavily again in promoting ringback tones to their customers.
The other bit of good news is the sudden availability of music, movies on the Indonesia iTunes store. After being left out of the iTunes launch in several Asian countries, reportedly at the last minute, Apple lovers discovered that they could download songs, movies and even ringtones for their gadgets. The offering was initially limited to content from the major labels, but gradually started to offer content from Indonesian music labels as well (and within a short time, having Cakra Khan and NOAH top the singles chart). Although Indonesia is said to have a very low iOS device penetration level, a number of users have resorted to using US iTunes accounts to buy music, and we will yet see the impact on the industry on a larger scale.
These small steps, in any case, are good for the business. I have always been supportive of the presence of numerous revenue streams for music, traditional or non-traditional – but I would not hold my breath if either is claimed to be the so-called ‘savior’ of the music industry. History of businesses has shown that depending on a single revenue stream, albeit seemingly endlessly lucrative, could be very dangerous – so let’s hope the industry players keep developing new ways for music fans to interact with their favorite music and favorite artists. Projects like XL’s Musikkamu and Indosat Backstage are a step in the right direction.
Of course, the good news isn’t just for the established music labels. Promotion of ringback tone services may renew interest in the product and reopen opportunities for musicians who are interested in distributing their music in ringback tone form. Aggregators like Valleyarm and recently-announced Gotong Royong Music can help distribute Indonesian music not only to iTunes here and abroad, but to a multitude of other international music services as well. Some may say that selling MP3s is a lost cause due to the ease of internet piracy, but it does not mean that there isn’t a market for people who want to pay for songs in return for a convenient and comfortable experience, or even for the sake of contributing back to the artist.
The established music labels may have more business influence with partners like the telcos and Apple compared to a struggling indie band, but the digital world is a very large place. Niche opportunities abound, and potential fans can even keep track of many trends at once. As long as a suitable – and well-balanced between various strategies and revenue channels – digital business strategy is in place, the presence (and in the case of ringback tones, reestablishment) of additional music revenue channels is always a good thing.
Ario is a co-founder of Ohd.io, an Indonesian music streaming service. He worked in the digital music industry in Indonesia from 2003 to 2010, and recently worked in the movie and TV industry in Vietnam. Keep up with him on Twitter at @barijoe or his blog athttp://barijoe.wordpress.com.
