Economic Analysis: Why is Hindi film music so successful?

2016 has been an intense year. The long-winded, election in the U.S. Notebandi (demonetization) in India. Love them or hate them – they were ‘heavy’ issues that no one (at least not me and the people I know) could ignore.

And now I was thinking of writing an article on India’s population. More heavy stuff at the end of the year! No. Let’s look at something more cheerful: the Hindi film music business.  This is a very successful business. It dominates South Asia and is listened to many other countries. And, more people listen to film songs than see the movies the songs are in. Listening is cheap, while going to the movies is not cheap.

But, hey, I am an economist. So, I will look at it from the perspective of an economist. Others can fill in with analysis related to music, social issues, cultural trends – anything that is relevant. Incidentally, while I am not a cultural maven, I do sense that cultural highbrows don’t approve of Hindi film music.

Why, the Government of India did not even allow All-India Radio – the only Indian radio station at that time – to play film music for ten years after Independence. Well, the people turned to Radio Ceylon, a commercial radio service from Ceylon (as Sri Lanka was known then) to listen to film music. But, Radio Ceylon broadcast on short-wave, which required more expensive radios than those needed to listen to just All-India Radio on medium-wave. So, people had to listen to film music at the chaiwala and panwala shops – or, at their friends’, relatives’ or neighbors’ homes. Or, just walking around the street, listening to the radios in well-off people’s home.

Ok – enough nostalgia. Get on with the economic analysis.

Specialization. Economists know well that specialization leads to efficiency in production. There are four function in producing a Hindi film song: the song writer, the music composer, the singer, and the actor who lip-syncs in the song in the movie. It is possible that the same person could do all of these four things – but that would not be specialization. It would be more like an arts-and-craftsy artisanal way of producing a song. Perhaps very creative but not as efficient as what we have in Hindi film music: complete specialization. Each of these functions is done by a specialist?

So what?

Specialization allows for the quick and low-cost production of a large number of diverse songs. Take India’s most famous film singer: Lata Mangeshkar. When she showed up at the recording studio, the song had been written, and the music composed. All she had to do was sing. She would listen to the music as she read the words of the song. Then, she would sing with music. And it was done – with all the necessary emotions, twists, and turns. Probably in 1 hour. And, then she would move on the next song.

Talent-based competition. It’s a pretty competitive business. So, you cannot use people based on friendships, discrimination, or traditional identities. In making a song, you draw upon talent from wherever it is. One dominant person today is A. R. Rahman. His mother tongue is Tamil – not Hindi (and people from Tamil Nadu have long resisted the imposition of Hindi). And he was born a Hindu who converted to Islam after a major family event.

Lata Mangeshkar’s mother tongue is Marathi, not Hindi. She sang her first Hindi film song in 1942, when she was 13 years old, to financially support her family after her father passed away.

Singers Geeta Dutt, S.D. Burman (also a music director), and Kishore Kumar (also an actor) were Bengalis. Music composers Kalayanji-Anandji are Gujarati. Singer Mohammed Rafi was Hindi speaking – no one cared that he was a Muslim.

So what?

Well, you get high quality when you use the best available talent.  True, many who consider themselves are masters of Indian classical music will not deign to step down into film music – though M.S. Subbulakshmi did sing in Meera in 1947 early in her career. In more recent times, Pandit Hariprasad Chaurasia, a classical flute player, has teamed with Pandit Shivkumar Sharma, a santoor player, to form Shiv-Hari to compose music in many films.

And a side-effect is that you get national integration. Each regions identifies with its leading people – but in a national (and international) context.

[An aside to the idea of competition. It is charged that Lata Mangeshkar and her sister Asha Bhosle had used their dominance to lock out other women singers. That’s collusion, which is anti-competitive. But, I will not discuss this further. Remember, this is a ‘light’ posting!]

Economies of scope. The Hindi film music business takes advantage of economies of scope – which means that it is cheaper to produce two things together than to produce each one separately. So, we have all types of songs from the Hindi film business. Sad, playful, happy, love, risqué, patriotic, religious, sufi, classical dance, bhangra, Indian classical, western-oriented, children-oriented.

So what?

It makes the industry demand-driven, meaning producing what the people want. They want diversity of music. A movie has several songs. They all cannot be of the same type – too boring, anyhow.

Recognize very low short-term marginal costs. Ok, we know you are economist, but what the heck does this mean? It means that the songs business is different from the normal business of producing goods and services. It’s very cheap – almost no cost – for the next person to hear a song, once it’s been produced. Or, you can hear it again. On the radio in the old days. Now on your phone or whatever device you use. The song does not get used up or worn out.

So what?

In these situations, the responsible person has to aim for the mass market. Because the cost is virtually the same whether 10 people hear it or 10 million people hear it. So, it makes sense to try to appeal to as many people as possible. This means simple (not convoluted classical stuff) lyrics and catchy music.

And this made for national integration as people from all parts of India heard and enjoyed the same songs.

Anything wrong? Yes. It is likely that many of the people in the business are tax evaders. But, I will not dwell on this in this note!

Other businesses in India could learn these lessons – and become productive leaders in India and other countries.