Chinese tech giant ByteDance is soon to bring music streaming app for Chinese listeners, as according to Chinese tech-focused media outlet TechPlanet on 15 December. The final launch comes just a few months after the announcement of the new service in September, showing the tech giant’s hunger for gaining a share of the market that continues gaining steam in China.
It is understood that the internal trial of the new product has been carried out and the name of the final product has been changed from the initial suggestion of Feiyue (or Flight Music) to Qishui Music (or Soda Music), aiming at young trendy music lovers.
The expansion into music streaming is partly down to the limited space for traffic growth seen at ByteDance’s flagship video-focused service Douyin (Chinese Tik Tok), with China’s short video users reaching the ceiling.
Despite a consecutive increase in overall short video consumers since the year 2017, with the number surpassing 873 million as of this June, the growth rate of users saw a slump from 107% in 2018 to just over 25% the year after and the figure has not gone beyond 20% till now, per the Chinese industry research institute iiMedia. It is clear that with short video consumer base being finite, ByteDance would brand out looking to widen its audience base within this new market.
In comparison, the music streaming market remains high in the potential for the tech firm to explore. While the music streaming industry worldwide saw a 19.9% increase in revenue in 2020, as live music events had been called off during the pandemic, and online platforms became a new stage for music fans.
The same applies in China, with the market scale of online music services in China tripling since 2017, to have reached 12.8 billion RMB ($2.01 billion) in 2020, and expected to grow to 24.2 billion RMB ($3.8 billion) in the coming two years. The cake is too lucrative to overlook and as such ByteDance has seen this potential, firmly believing this is the next economy the company can expand into and take a large share of.
Full of opportunities as it is, the fast growth of the new arm is no guarantee, as the market has already seen an intense rivalry between China’s two biggest online music service providers – QQ Music, owned by Tencent Music, and NetEase Cloud Music, which is under the Chinese Internet technology company NetEase.
The two earlier market players have long been in a battle to win over Chinese young listeners, with NetEase Cloud Music currently pursuing an Initial Public Offer (IPO) in Hong Kong, aiming to raise HK$ 3.28 billion ($421 million) to improve technological capabilities and user experience as well as diversify content offerings. It is clear that if ByteDance has such ambitions, they will need to face stiff competition that has a lot more experience in the area, clever strategy and unique offering will be needed to appeal beyond competitors.
While some users are positive about the future of Soda Music, citing a large music source that ByteDance already possesses on Douyin, as many Internets hot songs are coming from the video-sharing platform. Others caution that the journey for ByteDance could be tough, with comprehensive solutions to customisation and user experience already being offered by QQ Music and NetEase Cloud, leaving minimum space for the new market entrant to leverage.
It will be interesting to see ByteDance’s new ventures and how successfully they are permeating the market, with the unique strategy and user experience needed to gain large footholds.
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