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Updated: Rdio buys Dhingana to Enter India


rdio_dhingana(by NT Balanarayan, Vikas SN & Nikhil Pahwa)

Exclusive: US-based music streaming website Rdio has acquired Indian music streaming website Dhingana, Dhingana has confirmed to MediaNama. MediaNama had heard about the development from multiple industry sources.

Sources also told MediaNama that the amount being offered to Dhingana is lower than the amount of funding they had raised. Dhingana had shut down its operations in February 2014 a couple of months after the biggest music label in India, T-Series, decided not to renew its contract with the company. In December, after reports that Dhingana might shut down, Bhatia had told MediaNama that the company was in the process of restructuring its operations. He had at that point had declined to comment on the possibility of a shut-down.

Dhingana was backed by Lightspeed Venture Partners, but had also raised funding from Helion Ventures and Inventus Capital prior to this.

Also read: Want To Disrupt The Music Business In India? Here’s How

What Rdio gets

Above all, Rdio gets a team that knows how to deal with Indian labels and how much they charge for licensing. Remember that Dhingana had some issues with T-Series, which decided not to renew its contract, thus depriving it of content from one of the richest libraries of contemporary Indian music.

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Update: Dhingana has informed us that founders Snehal Shinde and Swapnil Shinde will be joining the Rdio team, where they will be responsible for Rdio’s expansion efforts in India as well as other emerging markets. Rdio India will be launching later this year. On the question of Dhingana CEO Rohit Bhatia remaining with the company (which a few people have asked us about), he had told us yesterday that he is still with Dhingana. He had declined to confirm or deny the Rdio acquisition yesterday.  Update 2: While Bhatia is still with Dhingana, he has informed Medianama that he will be leaving the company shortly to explore other opportunities.

Secondly, Rdio gets an Indian user base that was using Dhingana. It was among the three more popular music streaming services, along with Saavn and Gaana. While the user base would have moved on to its competitors now, Rdio can enter the Indian market and offer it their services, with their content, as well as International content.

Thirdly, and we’re not sure if this is applicable: Rdio gets any existing music label contracts that still haven’t expired, as well as, possibly, an option to offer its live streaming services to Idea Cellular customers, for $1.99 (~ Rs 120) 

How will Rdio deal with exclusivity?

It needs to be seen how Rdio will handle the issue of exclusivity in India, where one player corners the rights to a particular music catalog, and another where there is a lack of standardization of licensing.

Created by Skype founders Niklas Zennström and Janus Friis in 2010, it last raised funding in 2011, when it then received $17.5 million from Mangrove Capital Partners, along with earlier investors Skype, Atomico Ventures and Friis himself through some of his investment entities. It had then laid off a significant portion of its staff in November last year “to improve its cost structure”.

Rdio’s services are currently available in the US, Canada, Brazil, Uruguay, Argentina, Australia, New Zealand, Germany, Spain, Portugal, United Kingdom, Denmark, Estonia, Lithuania, Finland, Norway, Iceland, Israel, Netherlands, Belgium, Mexico, Malaysia, Hong Kong, Colombia, Chile, Czech Republic, Sweden, Switzerland, Poland, Ireland, Italy, France, Latvia, Austria and South Africa.

What about pricing?

Rdio charges $9.99/month for unlimited streaming of songs across web and mobile devices. That pricing however might not work in India, where streaming is essentially free.

All of these services have a free service and then a paid tier for those who want to cache songs on mobile devices for offline listening. Gaana+ is priced at Rs 110 per month and is available on iOS and Android. Hungama meanwhile offers a monthly subscription service at Rs 99 (through operator billing) and Rs 110 (through Google Wallet) and it allows unlimited ad-free streaming of full length songs and videos. It also offer various plans to purchase and download songs including a single download (Rs 10 per song), value pack (4 items for Rs 20) and value pack (10 items for Rs 50). Dhingana, a service that was competing with Saavn, also had operator billing support with Idea, but it shut down earlier this month. Vodafone’s service meanwhile, lets you download unlimited number of songs for a monthly fee of Rs 99.

Open for developers in India? Rdio has an API that can be used by developers to create music oriented apps. Internationally Shazam uses these APIs, but the company has a tie-up with Saavn in India for music recognition services. It’s not clear what will happen to that deal once the acquisition is completed. Gaana had also launched a similar API last month and had invited developers to submit app ideas on its website.

Dhingana So Far

Feb 2012: To Focus On Mobile & Social; To Launch Open Graph Integration
May 2012: Launched Open Graph Apps On Facebook
Aug 2012: Launched Ad Platform; Roped In Gokul Rajaram
Oct 2012: Raised $7M In Series B Round From Lightspeed & Existing Investors
Jan 2013: Inked Two-Year Advertising Deal With Universal Music
Launched Mobile Site; Monetization; 3.5M App Downloads
Feb 2013: Appointed Rohit Bhatia As CEO; Based In India
Mar 2013: Introduces Radio Stations; Plans RJ Based Programming
Apr 2013: Partnered Sony, Universal & Others To Improve Its International & Regional Catalog
May 2013: Launched Video Ads On iOS; Android To Follow
Jul 2013: Launched Paid Subscriptions; Revamps Website
Aug 2013: Launched App for Windows 8
Nov 2013: Introduced Carrier Billing In Android App With Idea Tie-Up
Dec 2013: Tied-Up With General Mobile To Preload Apps On A Million Devices
Dec 2013: Is Dhingana Shutting Down? CEO Says They’re Restructuring, Update Next Week
Feb 2014: Dhingana shuts down

Update: Dhingana has confirmed the development, so the post has been edited to remove references to all the people we tried to confirm this with.

 

  • ravibhure

    It is great and exciting news, all @Dhingana .. Happy Holi !!!!

  • Rajesh Poonaswamy

    Super weird timing by the VC investors. Just a few months ago the site shut down. Why? A deal like this was probably brewing for several week (or months), and if it hadn’t been, the team & investors should have been actively pursuing a buyout as an alternative to shutting down and losing customers. Seems like the VC investors should have bridged the company for a few months till a suitor was found and get a face-saving ‘exit’, albeit one with minimal rewards. Right now, looks like a bungled asset sale on the cheap.

  • amit

    Dhingana, upon their launch, got a lift from Saregama when they were part interactive streaming license from PPL and were streaming smashhits for T-series content. Technie brothers of dhingana couldnt survive smart business tactics used by common people coming from Saavn (phulki), raaga and smashhits. For years raaga and smashits enjoyed free streaming and there are stories of bribes to licensing officers….india isnt ready for paid content yet and guess never will be in coming 50 years. Itunes will pull the plug likewise flyte did as well. T-series is a big game player and bhushan kumar is following is father’s footsteps to earn by hook and crook.