Flipkart has been called India’s Amazon.com Inc., and, taking its cue from the US-based shopping website, rolled out a paid MP3 download service called Flyte in February. Last month, Flipkart also made its entry into e-books, which make up less than 1% of the total book market in the country. The company believes there is a vast and untapped market for digital media in India and recently completed talks with Penguin to add the publisher’s books to Flipkart’s digital library, bringing the catalogue up to over 100,000 books.
Aside from Flyte, users can now also choose to buy their content from Apple’s iTunes service, which recently launched music and movies at competitive prices in India, and Nokia mobile users have access to 4.5 million songs they can download on their handsets for Rs.99, for 30 days.
Sameer Nigam, vice president, digital, Flipkart, who oversees Flyte, spoke in an interview about the development of the digital media market in India. While Nigam didn’t discuss competitors such as Kindle e-books or iTunes music, he said Flyte should follow a rational trajectory instead of copying the competition. Edited excerpts:
Flyte has been selling e-books for a month now and MP3s since the end of February. What’s the buyer’s response been like?
The response has been really good; we’ve been very pleased with the robust numbers we’re seeing. To date, 1.5 million songs have been downloaded, and today we’re seeing around 10,000 to 15,000 songs being downloaded every day. We started selling books only four weeks ago, but our Android app has around 25,000 users now, and while we’ve not broken down the percentage of free books versus paid books, we’ve seen between 40,000 and 50,000 downloads already.
Our catalogue has over 100,000 books, and 5 million songs from 150 labels. Each region has its own label—the Indian music market is very fragmented, and we make it easier for users to find the content they want, which is a big plus. At the same time, English music is very popular but again, we help people to have all their content—English and otherwise, in one place, and ease of use is a big factor for us. Digital content is relatively new—we wanted to create the habit in the market, by removing as much friction as possible.
Digital rights management (DRM) or copy protection is unpopular with the users—why is Flyte following this model?
Our music is available without DRM—you can download it and copy it to any playback device you own. But from a books industry standpoint, DRM was needed. Honestly, DRM is a much-abused term, but it has benefits too. For example, it allows us to implement re-downloading—you can download a book you’ve bought on up to six different devices, as many times as you like. Having it restricted to the app also helps with library management, to give the user a good experience. Plus, we wanted to offer India-specific pricing, with books costing around $4 or Rs.200, on average. All this becomes possible when we have DRM on the books.
So the book publishers set the terms on DRM?
I don’t want to point fingers at publishers—it was collaborative, we worked together for a couple of months to find out what was best for the customer. Having the DRM in place allows us to offer a very favourable experience for the customer, with full sync across their devices, and low prices—users don’t need to buy an expensive e-reader and then pay dollar prices for books. They use the device they already have and they pay a lower price for the books.
While you say that the books are cheaper, that’s actually not the case. Some books are cheaper on Flyte, and others are cheaper on Amazon, so the prices aren’t actually India-specific. Why is this?
There are two factors—for one thing, not our entire catalogue is offered at the lower prices yet, and that’s something that will happen over time. Secondly, we’re not going in for price comparisons with other sellers. We’re comparing the e-book to the paperback you can get on Flipkart, and pricing competitively with that. Many of the competitors use loss-leading tactics, which make it hard to have rational pricing, and we wanted to avoid this.
Are there any trends you picked up from the MP3 business that have helped with the e-book market?
The two actually function very differently—digital music is already well understood and it’s a mature market. We exercise much more control over the user experience with e-books, and so our focus there has been on adding a lot of value to the interface. With music, we have to build the catalogue, build discoverability, but with books, our role goes further. So we think of things such as adding re-sizeable text, and night mode for easy reading in bed, to improve the platform.
But there are certain common issues, for both books and music, which are also very India specific and need to be solved. First, there’s a problem in the organization of regional content. The title will be written in the regional language, in Hindi or in Tamil, but when the user is searching for it, he has to type in English. So, what happens is that the publishers are all transliterating the words in their own different ways, and then the user who is searching is also using different spellings in English to search for the content. This is a serious issue, and it can really handicap search, so we’ve been working to come up with a solution here.
The other big issue is payments. People are downloading books and music equally on mobile and on the computer, but I believe mobile will grow to even more if it becomes easier to pay. Today, I can either open a PayTM webform in the app, or use a one-time password on the phone, but these are not convenient methods. A one-click solution is necessary, but that doesn’t exist yet, which is a big problem.