Universal Music returns to Bollywood with Excel, Maddock deals; eyes bigger slice of storytelling pie

The company, a division of Universal Music Group, acquired a 30% equity stake in film and digital content studio Excel Entertainment last month and entered into a strategic partnership with Dinesh Vijan’s production house Maddock Films and its new label Mad For Mussic last year. These transactions, a senior company executive said, mirror the company’s belief in long-term deals and not participating in bidding wars when studios launch film soundtracks.

Universal Music India reported a net profit of ₹29.5 crore on revenue of ₹638.6 crore for FY24, according to data from financial intelligence firm Tofler.

“We want to be part of the storytelling process," Devraj Sanyal, chairman and CEO, India, South Asia and senior vice-president strategy, Africa, Middle East and Asia at Universal Music India, said in an interview. “We won’t chase multiple new partnerships, but nothing is off the table for us. We are looking at acquiring catalogues and companies across spaces—regional films, regional independent companies which are in the periphery of the businesses that we are in, like music and brands or our merchandise business."

Sanyal said the company that owned the rights to hit yesteryear soundtracks such as Sholay, Bombay and Devdas did not like the traditional Bollywood model of soundtracks awarded usually to the highest bidder. Instead, it was focused on creating market share within the independent music scene over the past few years. This was coupled with marketing innovations, video and audio strategies, events, pop-ups and curated fan experiences.

Beyond market share

“We saw an uplift in our market share across these years, commanding 70-80% of the independent music market," Sanyal said. "We’ve been looking for people to partner with because we realized if we want to be part of the music and entertainment business and impact serious storytelling, it isn't possible to do unless you are part of these companies that do the best storytelling of our times. And honestly, it's been a couple of years of work to get to where we are across all our strategic and long-term film slates but we’re feeling good about where we are today."

Music labels have been taking an interest in film companies, pointing to growing trends and challenges in both ecosystems. Other than the Universal Excel deal, Saregama invested ₹325 crore in an initial stake in filmmaker Sanjay Leela Bhansali’s company in December.

According to experts, music streaming continues to deliver weak monetization, with per-stream payouts amounting to only a few paise, making it difficult for labels to generate meaningful long-term value even from large catalogues.

At the same time, fragmented rights enforcement limits how effectively music intellectual property can be monetized beyond traditional distribution channels. In contrast, the film and OTT ecosystem offer deeper, more diversified revenue streams, including content distribution rights, music royalties, performance rights and global syndication.

“Everyone is realizing music revenues are shrinking so it only makes sense to move towards production. Companies like T-Series and Tips have already done so," said Uday Sodhi, a senior partner at Kurate Digital Consulting. “However, these should be seen as purely investment moves that help returns—they cannot impact the label’s market position in any way because there is only so much music that a studio brings out a year across films and shows."

Paying for music

Sanyal emphasized that such deals are a win-win for everyone since they help film producers and owners of intellectual property retain the music in-house with partners such as Universal enhancing its value over time.

By coming on board as early as the scripting stage, they can impact how the music should be created and who the movie and soundtrack should be positioned for, enabling better marketing and targeting. All this will eventually not just push artists but create a stronger paid subscription economy for music.

“To create a paid economy in this world, you need to give quality and quantity equally to the consumer in a way that he feels compelled to pay. When an individual pays, the entire economy and not just the platform, label or publisher grows," Sanyal said.

The global music-streaming economy, whether in Japan, North America, Europe or South America, has grown because people pay for music, he said.

“And I think not playing in the film business space would not help anyone achieve that goal, and that dream very quickly," Sanyal added.