Tencent Music Entertainment’s 2021 report reveled, the music industry enjoyed substantial growth in digital music. As a whole music content grew 53.1% from 2020, leading industry analysts to estimate that a new song was created every 21 seconds in 2021. In China, streaming of new Chinese music increased by 9.3% in 2021, introducing a subtle change in users’ habits. New music made up 24.3% of total Chinese songs played, illustrating a consistent shift from the popularity of old music to new.
A catalyst for this shift is the unprecedented number of ‘one hit wonders’ reaching over a billion streams. Over 30% of China’s top charting artists reached streaming success after only one hit, creating what many believe to be a more lively and competitive environment and stimulating the industry. Also, the ability to earn a sustainable income as an artist has been critical for new artists’ development. By July 2021 the amount of artists able to earn a monthly income of $10,000 USD for the past year has increased by 9 times, creating a mechanism for musicians to make a full-time living from their craft.
From TME’s standpoint, revenues grew in 2021, fueled by music subscription and long-form audio. Tencent recorded US$306 million (RMB1.95 billion) from music subscriptions representing 23.5% growth from the Q4 of 2020. In total online music paying users reached 76.2 million, increasing by 36.1%.
“In 2021, we registered 7% year-over-year growth in total revenues and sustained profitability, boosted by robust growth of online music paying users reaching a record high of 76.2 million, reflecting the vitality and resilience of our business through resolute execution of the dual engine content-and-platform strategy. ” Said Cussion Pang, Executive Chairman of TME.
Pang concluded, “Leveraging our proprietary tools and technologies, we are pleased to see our investment in original music production starting to pay off, as well as an increasing number of indie musicians finding a home on our Tencent Musician Platform. ”
In a press release announcing the companies 2022 first-quarter results, TME outlined its four pillar approach to digital music entertainment: listen, watch, sing and play.
Listen: TME claims to be the first in China to launch three advanced listening functions to improve sound quality and equalize music volume, delivering a smoother music listening experience. QQ Music uses optimized algorithms to drive recommendations to a new record high penetration rate. With an upgraded Music Popularity Index TME has considerably strengthened users’ sense of participation.
Watch: Through several live streamed events such as ‘Spring Never Ends,’ a large-scale live charity concert. TME has put strong effort into providing live streaming content to support the music scene through out the pandemic. Beyond video, new features were introduced to enhance the user experience include the use of graphics, comment display functionality, and streaming visualizations.
Sing: TME also boasts the industry’s first sound tuning options without requiring earbuds, as well as cloud-based sound mixing, which can help substantially improve the sound effects of songs recorded.
Play: An upgrade to the TMELAND (TME’s Virtual sandbox) experience will allow users to attend featured events such as virtual avatar concerts. Dedicated virtual rooms were created for artists and recently launched virtual rooms for Jay Chou and Roy Wang, combining listening with virtual interactions.
“We are encouraged by the progress we’ve made with key advancements in our innovative platform strategy, built on our four pillars of music entertainment: listen, watch, sing and play. For example, QQ Music, Kugou Music and Kuwo Music recently released major version upgrades incorporating refreshed product concepts, as well as optimized operations, UI design and other technological innovations. Long-form audio has also proven to be an excellent complement to our powerful music portfolio, contributing to expanding user scale with long-form audio MAUs reaching over 150 million, representing a 65% growth year-over-year. Said Ross Liang, CEO of TME.