RPG Music International, the Gramophone Company of India Ltd's (GCIL)
subsidiary for music export, will receive a fee of two million pounds
for transferring the rights to manufacture and market Indian music in
the UK, US, Canada, South Africa and the Caribbean Islands for a period
of 20 years to Saregama Plc, RPG Music's wholly-owned subsidiary. GCIL
has also made a strategic investment in Meltrack India Pvt Ltd, the
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largest suppliers of audio tapes to it.
RPG Music had recently divested 24.45 per cent of its stake in Saregama
in the overseas market, fetching 2.45 million pounds. Saregama's shares
are now trading in London's Ofex exchange. The payment for the music
rights would be made in three tranches and a substantial part of the
payment would go to GCIL, which is the ultimate owner of the music
catalogue.
In addition, RPG Music would continue to receive royalty at agreed
rates, based on the sales clocked by its subsidiary Saregama.
Both GCIL and RPG Music are looking ahead with optimism, based on some
key assumptions. First, there is a major line-up of new Hindi film music
which the companies are banking upon. Besides, the regional film music
segment in Tamil and Telugu has a fairly sizeable market for this in
North America and the Far east.
With the opening up of a logistic centre in San Jose to stock and
service the entire range of the parent company's products, a hitherto
unexplored segment of the market, is also expected to boost the fortunes
of RPG Music abroad.
These apart, an increased number of digital video disc products in the
North American market and the creation of a distribution channel in
Malaysia and Singapore for old Hindi and Tamil film songs are also being
seen as good signs for the RPG music business.
In addition to all this, RPG Music's e-commerce site is also being
beefed up. Over 2,000 compact disc titles are now available on sale
through the Net and the company feels the quantum of music e-commerce is
set to grow in a major way in the coming days.
On the GCIL front, a major modernisation-cum-expansion plan was
undertaken at the company's Dum Dum factory. The installed capacity of
pre-recorded cassettes has gone up from 490 lakh the previous year to
550 lakh per year now.