India’s Largest Ecommerce Service Flipkart announced that it will close its Flyte digital music store next month, less than 18 months after its launch, saying there is insufficient demand for paid downloads in the country.
Flyte, who debuted at the end of February last year, sells DRM-free music, but he will take his final dance on June 17, after which the content will no longer be available for purchase, as NDTV reports. Despite this decision, the store will continue to sell ebook content.
The service launched with over one million DRM-free songs from 150,000 albums and has seen its catalog expand to over 5 million international and Indian tracks. The content is priced above INR 6 ($ 0.12) per track and starting at INR 25 ($ 0.51) for albums, with users being allowed to download each file four times in total, allowing them to to put their music on multiple devices.
In an email to registered users, Flipkart said it will refund unspent credit by the close date. Users have until August 18, 2013 to empty their digital lockers.
Mekin Maheshwari, head of digital media and payments at Flipkart, explained that the effects of hacking and payments are two of the main reasons for the shutdown.
We created Flyte MP3s a year ago in what was an extremely nascent industry. The aim was to bring legal digital content to consumers in India. In no time, we have built a huge catalog of digital music at very affordable prices as well as a loyal base of nearly 100,000 customers. “
However, we have realized that the music downloads industry in India will not reach a large scale unless several problem areas like music piracy and easy micro payments etc. are not resolved in depth. Therefore, we believe that at present it makes sense to take a step back from Flyte MP3s and revisit the digital music market opportunity at a later stage.
Flyte’s pay-store approach went directly against the freemium model that a number of India’s top performing music streaming services have adopted with some success.
Dhingana and Saavn both have over 10 million monthly active users, while Gaana.com is growing rapidly following a recent overhaul. All three services offer a free, ad-supported experience for users, with subscriptions for those who want to upgrade to free advertising. (Spotify, although now in Asia, is not yet available in India, of course.)
The Flyte proposal, while interesting as a concept – especially for being DRM-free – has always faced challenges given the emergence of the paid digital content market in India. That’s the message Satyan Gajwani, CEO of Times Internet – the company behind Gaana.com – is getting from the news.
Flipkart shutting down Flyte doesn’t surprise me, only reaffirms my belief in freemium streaming services like Gaana
– Satyan Gajwani (@satyangajwani) May 29, 2013
While Apple and others have the infrastructure and catalog to succeed from a pay-per-view model in pirated markets like India, Flyte’s demise raises serious doubts as to whether the same applies to small businesses. And not just for music content either.
Title image via Shutterstock