Label Makers – Why The Lockdown Has Seen A Spurt In The Launch Of New Indian Record Companies

Launching a label in the middle of a pandemic may seem counterintuitive but the last few months have seen a spate of new Indian music companies from mainstream and independent composers, singers, and artist management companies.

Amit Trivedi’s AT Azaad and TM Talent Management’s TM Music arrived in April; Vishal Bhardwaj’s VB Music, Salim-Sulaiman’s Merchant Records and Sonu Nigam’s I Believe Music in July; Krunk’s Krunk Kulture in August; and Arijit Singh’s Oriyon Music in October.

Emiway, Vishal Dadlani, and Zubeen Garg are expected to announce their respective labels soon and Third Culture Entertainment’s as-yet-unnamed record company has scheduled its first release for January next year. The genres and styles they showcase might be different but they share a number of commonalities.

They’ve been in the works for years

“This is something we wanted to do a long time ago,”says Salim Merchant.“We never got the time because we were traveling like maniacs.”


The film composer points out that his brother Sulaiman and he have been releasing compositions independently since 2014 but finally got around to formalising the process under a label after the nationwide lockdown put an elongated pause on touring from the end of March.

Similarly, Tarsame Mittal, the founder of TM Talent Management (which also happens to be the parent company of this website), brought forward his plans to start TM Music from October to April, after he realised that it’s going to take a while for the live music business to get back to pre-pandemic levels.

For Sohail Arora, who runs Krunk, which was arguably the most active electronic music event company in Mumbai, the time that he had on his hands post-lockdown enabled him to execute plans for a label he’d “been thinking about for almost three years”.

Their founders want to fill a gap in the market

There were three reasons Mittal decided to plunge into the music label business- opportunity, necessity, and frustration.

“Opportunity in the sense that ten years back, it needed a lot of money” which is not the case today “a necessity in the sense that a lot of young artists need a platform and nobody’s investing in them” and “frustration” because he got tired of trying to convince labels and filmmakers about the merits of upcoming musicians.

“I thought that if I have my own my label, I’ll take the [financial] risk with artists I feel are extremely talented.”

According to him, the need for a creative outlet unrestrained by the limitations imposed by major labels and movie producers is also what prompted three of the composers and singers he manages, Bhardwaj, Singh, and Trivedi, to begin their new ventures.

“They want to release music they believe in,” says Mittal. “When they work on films, the decision making authority is not just with them. They have to listen to a lot of people.”

While the likes of Trivedi and Bhardwaj have thus far only put out their own tracks, out of the eight original tunes presented by Merchant Records until date, seven have featured other singers and two are by other sets of composers, namely Nikhil-Swapnil and Tapas Relia and Vijay Prakash.

“We’re a boutique label releasing music by people who we feel are musically enriched and need opportunities,” says Salim Merchant.

Mittal and Merchant’s “non-film”-oriented catalogues might seem worlds apart from the house, techno, bass music, jungle, footwork, and drum and bass being packaged by Krunk Kulture but the ethos of all three labels is the same.

Krunk Kulture’s mandate, Arora says, is to “promote good, cutting-edge electronic music” and making sure it gets “enough press, buzz and streams,”

“I get around 20 demos a day and 90 per cent of it is from people I’ve never heard of but it’s pretty good.”

For Arora’s contemporary Tej Brar, the proprietor of artist management and event company Third Culture Entertainment, his soon-to-launch label will be a “reflection of the kind of acts we manage, bring to the country to tour and book for our festival, Neon East.”

Says Brar,

“We’re trying to incubate a new sound, which is lo-fi hip-hop meets R&B meets Neo-Soul meets Jazz. The reason I think it’s worthwhile [to do] is because there’s such an incredible wealth of musicians in this country, from bedroom producers to independent bands.”


They’re focusing on one-off releases 

Unlike majors, these new initiatives aren’t contracting acts for long-term exclusive deals, but enlisting them for a single track, EP, or album.

“I hate this concept of signing,” says Merchant. “The whole idea of calling it indie music is lost because you’re taking away artists’ freedom.”

This approach offers greater flexibility to both the label and the artist and reduces the investment they make in each other.

As Mittal puts it,

TM Music is “not signing artists, but songs.”

Krunk and Third Culture, on the other hand, will function more as curators than content producers. They will pick from completed projects that are brought to them and if required, cover the costs of mixing and mastering and artwork.

Each of these record companies function as separate entities from their sister management agencies so acts on their roster won’t automatically work with their label, say, Mittal, Arora, and Brar.

There will of course be some crossover but as Arora says, “some things are better fits for other labels. I have to look out for what’s best for the artist from the management point of view.”


The right distributor is crucial to their success

Among the factors that determine the viability of non-major labels is their distribution network. For TM Music and Third Culture, in fact, it forms an integral part of the business plan.

The former has a “long- term deal” with Believe Digital, from which it has received an advance to help fund its releases, while the latter has partnered with a UK-based publishing company that has partnerships “with 40 different labels across the world and relationships with different sync and publishing agencies”.

Trivedi’s AT Azaad and Singh’s Oriyon Music are also distributed through Believe.

For a self-run enterprise like Merchant Records, it was important to have “one touchpoint”, says Merchant.

To this end, it has tied up with regional music services company Global Music Junction, which not only takes care of tasks such as the input of metadata and collection of royalties but also seeding releases in the right playlists.

“Instead of me calling Gaana, Wynk, Spotify, etc, I just call Global Music Junction and they do everything.”

In order for Krunk Kulture’s music to reach target audiences using stores such as Beatport, Arora is working with electronic music-focused distributor Proton.

“You have to use specialists,” he says.


They’re Long-term Investments

Mittal explains that there are four main expenses incurred by a label: audio production, video production, promotion, and administration, while the main source of income is revenue from audio and video streaming, which right now is negligible for most new record companies. This is because smaller labels simply don’t get the same support major labels enjoy from streaming platforms, radio stations, and music television channels when it comes to playlisting and airplay.

“It’s very difficult to promote songs,” he says. “But good music finds its way. It’s a matter of time. It might take one year, or two, three, five years. We’ll continue our battle.”

He believes that unless the number of paying subscribers on audio OTT services increases on a substantial scale, artists and labels won’t be able to sustain themselves on income from streaming.

“Let’s assume the average payout from audio platforms is 5 paise per stream, the average payout from YouTube is 1 paise per stream and that a label spends INR 10 lakh on a song, which is the lowest minimum,” says Mittal.

“You recover the money when you have 20 million audio streams or 100 million video streams. That’s not easy to get.”

Merchant is candid about the state of his financial accounts.

“It’s a terrible business model,” he says. “We don’t even make 15 percent of what we put in, but I feel even if we recoup it after three or four years, it’s fine. It’s giving me so much satisfaction.”

Notably, while TM Music’s contracts are similar to those of majors in that the artist gets an upright fee, and royalties from the IPRS if they’re also the composer and/or lyricist, Merchant Records and Krunk Kulture cover certain costs on a case to case basis and split all streaming revenue equally with the artist after they’ve recovered their investment.

“With some acts, we also negotiate that if the song is bought by somebody, like a film [production house], we will give them a percentage of the sync option,” says Mittal. 

From more mainstream labels such as Merchant Records and TM Music to more niche operators like Krunk Kulture and Third Culture, the goal is to build a vast and robust catalogue that ultimately starts generating a good return on investment.

“You need to look at a record label like a festival,” says Arora. “Festivals break even in three to five years. You have to lose a little bit of money. It’s more about building a community.”

The advantage with electronic music, he says, is that a music video isn’t as integral to a song’s release as it is for pop and hip-hop drops. Instead of relying on revenue from YouTube, Krunk Kulture will supplement its income with limited-edition merchandise and sales of vinyl.

For Brar, his label will be an avenue for passive income that helps widen his on-ground audience.

“The way I think about it is that we’re building our ecosystem further,” he says. “If we can get more people interested in the kind of artists we tour here, like Homeshake and Kamasi Washington, it benefits us in the long run.”

Text by Amit Gurbaxani

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