Streaming services help to amplify paid music subscriptions
Tencent Music Entertainment Group, or TME, registered substantial growth in both online music subscribers and music subscription revenue, according to its latest financial statement. Yet industry insiders said that internet music still has a long way to go from being a free service to a paid one.
TME, as an online music provider, operates four sought-after music mobile applications in China — QQ Music, Kugou Music, Kuwo Music and WeSing, which collectively have more than 800 million users.
The company released its unaudited financial statement for the fourth quarter and full year of 2019 last month. It reported a 35.1 percent year-on-year increase in revenue to 7.29 billion yuan ($1.03 billion) in the fourth quarter of 2019, with 39.9 million online music subscribers, up 47.8 percent year-on-year.
“Digital albums ... didn’t become a natural thing for users to buy until last year,” record promoter Liu Shuiji told Beijing Daily.
Cai Xukun, one of the winners of talent show Idol Producer released his digital album Young on TME’s music platforms last year, with sales exceeding 60 million yuan.
However, most artists, especially some niche musicians, are unlikely to consider digital albums, as sales may be poor with people unwilling to pay for music online, according to Liu.
As a get-around, some artists release singles for 2-3 yuan, while music videos for such singles are generally available for free.
To protect copyright and encourage users to pay for music, online platforms and record companies are making great efforts.
Some record companies are offering benefits to digital album buyers, such as providing artists’ exclusive photos or videos, and giving buyers priority in taking part in offline activities.
“Based on users’ different ages and characteristics, we need to guide users to develop music consumption habits in a targeted manner,” said an analyst surnamed Dong with a music think tank.
Not all singers need to reach the huge sales as idol stars do in order to survive, Dong added. “As long as the industry gets the revenues it deserves, the industry will develop soundly.”
Online music platforms should create a new path for growth and generate new growth momentum, according to Chen Xianjiang, founder of ReChord, a music information portal.
Besides paying for digital albums, purchasing a monthly or yearly membership is another music consumption model, Chen said, adding that providing members with exclusive songs is a good first step to boosting consumption.
In addition, music platforms can think outside the box, develop into platforms for podcasts and audio books, and amplify their product lineup, Chen noted.