EY-IMI report examines why some Indians won’t pay for music

A comprehensive new study conducted jointly by EY and the Indian Music Industry (IMI) sheds light on the evolving landscape of music consumption in India, revealing persistent resistance among a significant portion of listeners toward paying for music streaming services. The expanded research, surveying over 15,300 digital content consumers in March and April 2024, offers an updated and more nuanced picture than previous efforts, including a 5,100-respondent survey published earlier this year.

According to the report, music remains an integral part of the digital entertainment diet in India, with 96% of respondents confirming regular listening habits. However, the platforms through which audiences engage with music show shifting preferences. Digital streaming platforms (DSPs) such as Spotify and Amazon Music account for 60% of music listening, a decrease from the 77% reported in earlier studies. Meanwhile, YouTube maintains a strong foothold, with 32% of respondents relying on it as their primary source for music consumption. Traditional media like radio, television, and film contribute to 17% of listening, while the use of pirated sources still affects 10% of the sample.

The divide between those who have ever paid for music and those who have not appears wider in this latest survey. Only 38% of participants reported having paid for music at least once, a decline from 58% in the prior study, leaving 62% who have never paid for music streaming. This contrasts sharply with the video streaming market, where 86% of respondents have spent money on subscriptions.

A major factor discouraging payments for music streaming is the widespread perception that free platforms—chiefly YouTube—provide sufficiently comprehensive access to music. Around 42% of non-paying respondents cited this as the primary reason to avoid paid subscriptions. Cost considerations also weigh heavily, with 33% indicating that subscription prices are too steep relative to their expectations or budgets. Additional reasons include a lack of interest in premium features (30%) and tolerance for advertisements (29%).

For those who have opted to pay for music, the appeal lies in enhanced user experience features. The absence of ads is the top motivator, influencing 44% of paying users, followed by the ability to control playback order (38%), higher audio quality (36%), offline listening capabilities (27%), and unlimited song skipping (26%). These factors underscore the value placed on convenience and quality enhancements available in paid tiers.

The report also explored hypothetical reactions to the removal of free listening options. A majority (61%) indicated willingness to pay for a subscription if no free alternatives existed, provided pricing remained affordable—ideally below 100 Indian rupees per month—or if music services were bundled with other offerings. Conversely, 39% said they would refuse to pay under such conditions, with many anticipating a switch to free platforms like YouTube (70%), a turn to pirated content (28%), or ceasing music consumption (21%).

Focus group insights illuminate an underlying challenge for the music industry: listeners tend to regard music as ambient and easily replaceable, whereas video content is perceived as more exclusive and intentionally consumed. This explains why consumers are generally more inclined to pay for video subscriptions than for music. Such perceptions present a fundamental obstacle for music services seeking to convert free listeners into paying subscribers.

To address these challenges, the report suggests strategic innovations that could enhance the appeal of paid music offerings. Recommendations include expanding product features such as high-quality audio and video streaming, deploying context-aware algorithms that tailor content to time of day or user activity, and fostering closer integrations with live concerts and events. Exclusive content, including creator-led behind-the-scenes material and interactive artist sessions, is also highlighted as a potential differentiator to attract and retain subscribers.

Moreover, bundling music subscriptions with other high-usage digital services—such as video OTT platforms, banking, telecom, or utility applications—is proposed as a viable pathway to broaden the subscriber base. Given Indian consumers’ affinity for bundled service packages, this approach could foster deeper engagement and sustained revenue growth.

IMI CEO Blaise Fernandes emphasizes the cultural dimension of subscription growth, framing payment for music as a form of support for the preservation and promotion of India’s rich and diverse musical heritage. The report notes that approximately 90% of content consumed in India is locally produced, underlining the importance of a robust subscription economy in empowering independent artists across the country’s varied regions.

While exact figures on the total number of audio-OTT subscribers remain unclear, the survey highlights the competitive landscape among music apps. YouTube leads narrowly with 32% of users having engaged in the past three months, closely followed by Spotify at 31%. Amazon Music and JioSaavn share similar user bases at 17% and 16%, respectively, with Gaana and Apple Music trailing behind.

The findings present a mixed outlook for India’s music streaming sector: strong user engagement but considerable reluctance to embrace paid models. Industry stakeholders will need to navigate consumer expectations, price sensitivity, and content preferences carefully as they seek sustainable growth amid a complex digital ecosystem.