Fighting to survive, Tencent-backed music app Gaana turns to subscriptions

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Tencent-backed music streaming app Gaana has switched to a paid subscription model to try to avoid closing down after failing to secure fresh funds, according to an email from the company to its music partners seen by Reuters.

Gaana, also backed by Times Internet, said in the email that talks with a potential acquirer had also "fallen through".

Gaana competes with the likes of Spotify, Apple Music, and Bharti Airtel's Wynk music app in the Indian streaming market, which data firm Statista estimated to be worth $700 million this year.

In the email sent this week, Gaana's head of content and partnerships, Sachin Kamble, said the company had not been able to "bring in fresh investments" and sought support for a new paid model of the service.

"Now we are at (a) crossroads – wind down/find a way to continue … we have decided to give this another try. Hence, we have closed streaming for free users today and (are) moving to paid only model," Kamble wrote in the email.

"We will need your support on this, else we will have to shut down completely."

Gaana CEO Sandeep Lodha told Reuters in a text message: "We are not shutting down". Kamble declined to comment.

Asked about the internal email, a Gaana spokesperson said in a statement the message was sent to music partners "in the course of private negotiations" to close agreements.

"These statements are being read out of context. Gaana is a strong business that is increasing its focus on subscription business with an intent to be a lasting company for years to come," it added.