A Symphony of Business: BNS on their evolution in the music industry

Bathiya & Santhush, or widely known as “BNS” need no introduction. The musician duo that started off in 1998 have revolutionized the Sri Lankan music industry, not only in terms of their musical innovations, but also with their foresightedness on brand expansion. In a little over two decades BNS have produced over 50 number-one hits, 6 platinum selling mainstream albums, 4 commercially successful EPIs and countless movie soundtracks. Bathiya Jayakody and Santhush Weeraman have pioneered the creation of a group of companies that is on its way to become one of the largest “one-stop-shop” for all entertainment and corporate communication needs – BNS Production Group. They are the primary shareholders of BNS Production Group which entails Saregama Music, Showtown Entertainment, SGM Films, Saregama Digital, Wonderworks BTL, SGM Technologies, SGM Media, SGM Integrated and SGM Logistics. A fine blend of artistic talent and entrepreneurial vision, Bathiya and Santhush offered Biznomics a glimpse of their evolution from a musical duo to a large-scale group of companies servicing the entertainment & communication industries. 

A well-rounded education – the early days of Bathiya & Santhush

When looking at their beginnings, Bathiya and Santhush would be referred to as “all-rounders’ ‘ in common parlance. Educated at Ananda College, Bathiya had diverse interests. Though he trained as a classical pianist from early days, his musical interests branched out to opera and jazz. He was a member of the Senior Brass Band where he played the alto saxophone. A testament to his many talents, he was appointed the Deputy Head Prefect in 1995 and was decorated as a President Scout in 1994. He took to playing tennis, and was involved in many student clubs, including the Interact Club of Ananda College and also serving in the Interact district committee. After his secondary education, he went on to complete a Bachelor’s Degree in Business, specializing in corporate finance and marketing from the Manchester Metropolitan University, UK. 

Santhush completed his secondary education at Royal College and excelled in academics, music, art and sports. He played for the rugby team of Royal College, was a member of the football team, and he sang in the college choir. He proceeded to acquire a Bachelor’s Degree in Marketing and Management in Australia. Santhush recalls a pivotal moment during an “International Student Day” in his Australian university, where he, as a young Sri Lankan sharing and celebrating his identity in a foreign country, felt a void when it came to Sri Lankan music that resonates with an international audience. 

The Indian tent played Bollywood and fusion music. The Turkish tent played theirs. The Americans had their hip hop and rap. Our tent didn’t play any music. Not because we didn’t have music that we are proud of.  But as young people we needed cool music that we could appreciate together with an international audience. That’s when I realized that it is very important to have cultural products that also have an international appeal. Music is very powerful in that respect. It gives you that identity.” This moment was crucial in understanding an emerging trend among young Sri Lankans. They were searching for a “Sri Lankan sound with an international flavour”.

“Music is not just songs.  It does much more to society. It gives identity. Music is a vital part of being a young person.” – Santhush Weeraman

After completing their degrees, the duo entered the corporate field in Sri Lanka, at some of the leading FMCG & financial institutions in the country. They acquired the foundation for music both at their respective schools and the Mary Anne David School of Vocal Music, Colombo where they studied opera, jazz and Broadway. The solid foundation they received during the formative school years was indispensable for their musical journey later on in life. Bathiya and Santhush had already entered the music industry in Sri Lanka as young artists in their early twenties and were known for their experimental music. Anyone who remembers Bathiya & Santhush from 1998 would recall that they were unique, modern and fresh. Their love for music and a sharp reading of youth preferences had culminated in a ‘Singlish’ album that was cool. They had produced a Sri Lankan sound with an international flavour. 

 

The inspiration – 80% in the ‘middle’

Bathiya and Santhush said they drew inspiration for their work at the inception, from the “80% of the society that is in the middle.” They explained this further, “There are broadly three segments of our society. When it comes to music, a 10% on one end of the spectrum is serious about authenticity. They like a very traditional type of music, and don’t want local music being tampered with. Another 10% on the other end of the spectrum, don’t appreciate anything Sri Lankan. They would look down upon you if you listened to Sinhala songs. But there is an 80% block in the middle that appreciate what is Sri Lankan, but also have aspirations to be modern and global. They are receptive to new sounds. It is this segment that we decided to reach out to,” they said. 

Their decision was not merely strategic, but they too resonated with the values, dreams and aspirations of the middle 80%. 

Bathiya and Santhush, in their early 20s, while working in their successful corporate 9-5 jobs, gained popularity in record time. While the switch to becoming full time musicians was tempting, it wasn’t easy.

 “Our families did not expect us to leave our corporate jobs. They were supportive, of course. It was a big risk.” They recount a critical moment in their early days that inculcated in them the importance of having financial stability and performing art.

 “It was a musical show out of Colombo. We were waiting to get on stage, and we met a very senior artist. He was 65 years of age. He told us that he has a lot of shows to do, etc.” 

It was a moment of revelation for Bathiya and Santhush. They realized how hard the senior musician had to work in order to make ends meet “At age 65, he had to keep working. That was a problem. It got us thinking about financial sustainability.” 

They had released two albums, but the revenue that came from intellectual property rights of music was negligible. They soon realized that in Sri Lanka, where intellectual property laws for musicians remain unenforced, artists face difficulties in earning from their original work. Musicians do not receive compensation from media institutions every time their creations are broadcast. Hence, they have to continue to perform in live shows or other engagements that bring in revenue. They got a taste of reality when both BNS albums were heavily pirated in the local market. When they looked around at other ‘career musicians’ they saw only a few options to ensure financial returns – playing in parties, weddings and concerts. But BNS wanted to be serious recording artists. While they were pursuing the music they love, they were cognizant of the imminent financial disaster to which they were heading. 

Beyond Borders – approaching Sony Entertainment

Bathiya and Santhush released their first two albums – Vasanthaye: a new beginning and Life – with a Sri Lankan record label in 1998 and 2000. Encouraged by the immense popularity won by their maiden work, the duo wanted to venture beyond Sri Lanka and partner with an Indian record label for their next spell of work. Although they proposed to the Sri Lankan record company that they could approach an international label together, the local company did not see the potential at the time. Afterall, this was before the internet revolutionized the music industry. Determined to approach Sony Music in India, Bathiya pleaded with his father, an army officer who had travelled to India for a special posting. 

“With greatest difficulty, we found an address for Sony. It was in Bombay. Both of us traveled to Bombay, only to find out that it was the wrong place. It was Sony TV, not Sony Music. We traveled again to the other side of Bombay and met one of their junior executives. He said, “don’t call us. We’ll call you”, and that was it.” Their first trip to Bombay did not materialize in anything. They made three trips to Sony, and yet, nothing had crystallized between them and the Indian record label. 

In the meantime, Bathiya and Santhush were approached by the Maharaja Group where they met the Chairman R. Rajamahendran. This was a turning point for BNS. When the Chairman asked “is there anything I can assist you with?”, the duo did not hesitate to relate their futile efforts to approach Sony Music in India. As fate would have it, the Chairman of the Maharaja Group of companies knew the CEO of Sony Music quite closely, and he immediately introduced BNS to Sony. This led to a breakthrough in their musical career. Sony Music expressed interest in opening up their franchise in Sri Lanka and offered to sign BNS as the first artists.

 “Sony did not know the Sri Lankan market well, and we stepped in, to answer a lot of questions for them.” Maharaja Group obtained the Sony franchise in Sri Lanka and BNS became the first Sri Lankan artists to sign a record label with Sony Music. Their 2002 Tharunyaye album was signed by Maharaja Group for the Sony franchise. 

BNS also did an Indian album for Universal Music Group, later on collaborating with superstars in the Indian music industry such as Asha Bhosle, Sonu Nigam and Hariharan. They are the only Sri Lankan artists to complete albums under both Indian recording giants – Sony BMG and Universal Music India. BNS’ objective in doing an Indian album was a strategy to get into the Indian music scene.

 “We were not expecting to be a huge hit in India.” Rather, they were aiming for exposure and connections to big name artists, production companies, and other sectors of the Indian music industry. Their vision to venture beyond the borders of Sri Lanka that was conceived in 2000/2001 started yielding results five to seven years later. 

“We are really grateful to the Chairman of the Maharaja Group for what he did for us, by introducing us to Sony.” 

Branching out in the industry – managing the value chain

The universe sends plenty of signals for transformation. One just has to be willing to look. In the early 2000s, BNS carefully scrutinized the Sri Lankan music industry in comparison to others industries like banking, telecom, advertising and insurance. They observed that many of the emerging industries were savvy about branding and breathing life into their products. Although they were selling commodities, they had transformed them into stories. It was a ‘eureka’ moment when BNS realized that a different industry – visual and music – could specialize in ‘breathing life’ to the products. But sadly, these two industries had not evolved in the early 2000s. “There was no branding. No identity.” This is when BNS realized that they needed to revolutionize the entertainment industry in a way that it can support all other industries. Although they took this aspiration very seriously, as young individuals in their early 20s, they did not have much clout in the higher echelons of power.

 “We did not have connections with the state. We could not have got the state to get the intellectual property remunerations to work properly. We could not have demanded a different structure than what they were used to.” Both Bathiya and Santhush explained their predicament.

Music production with Saregama Music

From the early 2000s, BNS took an interest in the backward integration of their music business. They realized that when an artist records a song, 80% of the revenue goes to the studios and production and that there is only 20% retainer for the artist. This realization led to their first business venture – the BNS recording studio, which they later rebranded as Saregama Music. They worked 160 hours a month, and 80 of them went into recording jingles. The rest they spent on creating their own music. The creation of this business venture stemmed from their own need to bring down costs of making their music, and having their own production facility allowed that. They partnered with skillful music producers and engineers such as Mahesh Denipitiya during inception and the operation started to grow. Today, they have five studios and a large technical workforce that run the enterprise. A number of bright, young music producers and sound engineers currently work with Saregama Music. 

Music Videos with SGM Films

By the mid-2000s, BNS were filming a number of music videos. This too led to another business venture. Astounded by the steep costs of producing a music video, BNS experimented with putting together a team that specializes in various technical areas to produce their own music videos. They established Saregama Films, which is now called SGM Films. SGM Films now handles video production for any entertainment or corporate activity. Their services range from creating television commercials to music videos to documentaries. With high profile clients such as Sri Lankan Airlines and Unilever under their belt, SGM films has completed over 300 television commercials to date. 

Event Management and Production-Showtown Entertainment

In 2004, with the launch of the BNS album Neththara, they wanted to do a state-of-the-art concert, a production that was unprecedented for the Sri Lankan audience. For those who remember the Neththara shows, they were larger-than-life productions that included projection screens and many dancers performing on scaffolding, fire elements and much more. In preparation for this concert, BNS consulted many companies to execute their vision for the concert. However, there were limitations of capacity, with some companies not being able to deliver exactly what was required by BNS and others who could were too costly. This led to a third business venture-Showtown Entertainment. BNS assembled an entertainment team, comprising university students and others whose work they were acquainted with. This small team transformed into one of the biggest operations in their group of companies. “Then we were asked to assist reality TV programmes, and a lot of TV stations hired us to put their live events together. We were doing high-quality productions. We offered an affordable, high-quality alternative to what existed at that time.” 

Today Showtown is a one of the top companies catering to the events and activation needs of the Corporate, Sports, Entertainment and State sectors, while serving an array of international clients. The company has also expanded into two other areas with its subsidiaries Wonderworks BTL which does below the line activations and SGM Technologies which engages in Virtual events with its own platforms.

Protecting Intellectual Property of artists -SGM Digital

Following their entry to the Indian market, BNS worked closely with Universal Music. In their interactions with Universal, they received much-needed exposure to the inner workings of the Indian music industry, one of the largest in the world. 

By 2008, a decade after their first album, BNS were ready to start their own label, and this resulted in yet another business venture – SGM Digital. SGM Digital produced Shaheena (2014) and Sara Sihina (2015) albums of BNS. A number of artists have come on board since then, under the SGM label. This is the artists and repertoire (A&R) arm of their business, and the primary objective of SGM Digital is to manage intellectual property of the recording artists. This company works with YouTube, Spotify and other companies to create content. 

Marketing consulting and communications for the digital era-SMG Media and SMG Integrated

BNS’ ambition to revolutionize Sri Lankan market by servicing the music and visual aspects of production led to the establishment of two other SGM companies – SGM Media and SGM Integrated. Keeping in mind the future of the entertainment industry would require the production of predominantly digital content, SGM Media was instituted to focus on this aspect in a manner that adds value to businesses via positive messaging. 

SGM Integrated is a marketing consulting company catering to the marketing communications and strategy needs of any brand. It is not the typical advertising agency. Most advertising agencies focus on a brand’s communications strategy and work closely with media and market research. Brands too are primarily fixated on a horizontal growth strategy focusing on the Sri Lankan market. Once they reach a saturation point with regard to market share, they expand to another industry. “But why should we limit ourselves to 20 million people? We need to have the corporate vision to be the “biggest” in some business in the global market. We need to think beyond this island when it comes to market share.” SGM Integrated specializes in creating a brand formula to tap into the full potential of a product, without limiting the market to Sri Lanka. Their approach is to create a brand that has an international appeal and fuse it with elements of ‘Sri Lankan-ness’. They believe such brands can reach their full potential in the international market. 

Guarding against insularity and going international

There was an organic expansion of the BNS Productions group, and later they branched out to logistics and media which supported the back-end operations of events. They soon realized that serving the purpose of BNS was not sufficient. BNS had become a brand synonymous with creativity and entertainment. And there was a substantial market share to be acquired by opening up their services to the corporate sector and the state. To explore their untapped potential, the group invited individuals outside the entertainment industry, particularly from corporates to join an ongoing discussion on how to grow their business. “We did not want to be insular. We wanted to bring in people who aspire to be in entertainment, but from other fields. We recruited executives, managers from banks and other corporates, so that they bring a whole new dimension to our team.” By 2012, the Showtown Entertainment became a leading company undertaking the production of top corporate events for top corporates in the country. They also successfully produced opening ceremony for the Commonwealth Heads of Government Meeting (CHOGM) in 2013. With a flawless track record producing events such as the Sri Lanka Premier League, Showtown was approached by overseas clients as well. Sri Lankan conglomerates operating overseas now hire Showtown services to produce events in countries like Maldives, Dubai, Qatar, Kenya, Seychelles and Korea. Among Showtown’s most recent successes is the Sri Lanka Investment Forum 2021, a 3-day virtual event, jointly organized by the Board of Investment, The Ceylon Chamber of Commerce and the Colombo Stock Exchange. 

We did not want to be insular.” – Bathiya Jayakody

Market research lead innovation for growth 

BNS’ vision and their business acumen are backed by the evidence they constantly accumulate through research. Prior to the onset of COVID-19 pandemic, during team brainstorming sessions they played out future scenarios and the shift towards a digital world. They invested resources to develop services using virtual and augmented reality. Equipped with the technological know-how, BNS, together with TV Derana and Dialog Axiata organized Sri Lanka’s first ever drive-in concert which treated fans to the first live music experience since the COVID-19 lockdown in June 2020. They introduced the emerging trend of drive-in concerts that allows performers to connect with their fans real time, whilst maintaining safe social distancing measures. The BNS drive-in concert was not only Sri Lanka’s first, but South Asia’s first during the pandemic period. It also served an important social objective. The concert was the kickoff of the “Restart Sri Lanka Initiative” launched by the Sri Lanka Institute of Marketing (SLIM) together with the Office of the Prime Minister, aimed at reviving the Sri Lankan economy after a long-drawn lockdown period. It was a symbolic exercise not only to re-activate the entertainment industry but also to motivate Sri Lankan businesses and people. 

Today, brand BNS as singers, are clients of the mammoth 360 Corporate they themselves created. In the events sector they have has bagged many of the top corporate contracts. In the commercial filming sector, they undertake numerous projects to produce many commercials and documentaries. In the audio sector they produce corporate jingles, songs, and movie sound tracks. The entire audio range for the cosmetic giant Spa Ceylon is handled by them. As one drives around in the city, numerous LED advertising boards both indoor and outdoor are bound to catch one’s eye. The chances are that Showtown’s BTL together with Atom media operates some of them. 

Over the two decades the business of BNS has had exponential growth, offering opportunities for young creative minds to explore their full potential. Their foresight has prepared them for the future, and even amidst the financial belt-tightening during the pandemic, employees in the group have held onto their jobs. The flat structure that is maintained among the companies allows employees to maintain direct lines of communication with different levels of managers and directors. It has created a secure and collegial environment among them. “They are the building blocks of our business, and they have taken ownership of the business.”

Advice for young artists

Through experience, BNS firmly believe that musicians, while mastering their art, also need to develop an insight into monetizing their talent and making it a sustainable business. In Sri Lanka, the gulf between art and a business based on art remains wide. And often there are negative preconceived notions about individuals who make profit out of their artistic talents. 

“We get accused of that all the time. Of course, primarily we are artistes we are also entrepreneurs. How would you grow otherwise? In the real world art and entertainment also operates as an industry.” 

In their view, every job is an art. One can either do it as a mundane job, or find ways to grow and be creative and still be part of the mainstream economy. They are optimistic of the new generation of artists who are savvy not only about music and technology, but about monetizing their talents. 

“The landscape has changed. Digital markets have come into play and a lot of young artists that are coming are savvy. However, the challenge for them is to develop businesses out of their work, because the industry is highly saturated.” 

Investment prospects in the music industry in Sri Lanka?

Investors are apprehensive to invest in local artists due to the limitations in the enforcement of intellectual property law and the lengthy litigation process. This makes investment in Sri Lankan artists extremely unpredictable. 

They are worried about copyright issues. So, they are very hesitant to invest. Even when we were signed by Sony, they did not invest. We invested in the production.” BNS elaborates.

Most artists depend on the local market for revenue, and there is no guarantee that they will be compensated every time one of his or her creations is played on TV or aired on radio. Hence, the investors are unsure about recovering their investment. BNS agree that a lot of work needs to be done in the area of intellectual property law enforcement in Sri Lanka and they are heavily involved with artists and policymakers to bring about positive change in this respect. 

Where Sri Lanka has an emerging opportunity is in production. BNS are positive that Sri Lankan conglomerates are ready in terms of capacity to service investments from other countries in the area of production. 

Plans for the next five years

“We have realized that the post-COVID world will not be the same.” At the moment, BNS and their team are conducting a thorough analysis of the past year, and building future scenarios that have real implications for how they move forward as a group of companies. They are aware that certain streams of business will cease to exist after COVID. They are carefully utilizing this time to identify those areas of the economy. 

Once things open up, say after 2023, if you’re not ready, you will surely be history.” 

BNS are undoubtedly talented musicians, however, it is not just their musical talent that has secured their success – it is their business acumen, persistence and hard work that has helped them grow to the place they are at today. They are forever searching for new opportunities and improving on what they offer today. Explaining their plans for the immediate future, BNS hinted at an exciting new project that they are working on that is scheduled to go public later this year. “It is a very interesting project that we are doing with a lot of love.” 

 

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