Digital music market is difficult to make profits, BAT each looks for a monetization portal

The acquisition of copyright by each company will be transformed from agency to "agency + self-production", competition among platform vendors will intensify, and copyright resources will tend to be shared in the future; second, the payment of content or platform services will be made; third, the fan economy will be strengthened, and pan-music consumption will increase.

This month, Netease Cloud Music announced the completion of Series A financing of 750 million yuan. As a product officially released in April 2013, the current number of users has exceeded 300 million. Such achievements have established the brand of Netease Cloud Music as a dark horse in the domestic digital music market. Because in this field, the competitors it faces are very strong, making it another market that has been divided by BAT.

Although capital and giants are passionate about this industry, most users have not been able to develop the habit of paying to listen to songs, which is a long-standing pain in this industry.

Wang Chuanzhen, an analyst at Analysys Interactive Entertainment Industry Center, said in an interview with reporters that due to the long-term piracy environment, the payment rate for pure music forms in the domestic digital music market has always been insufficient. However, we must still see that the market has entered a protracted battle for the industry that is compounded by resource integration. The shift of copyright to "agent + self-production" has intensified competition among platform providers. In the future, payment for content or platform services will eventually be a trend. For example, the fan economy will be one of the driving points.

Netease Cloud Music's newly funded digital music has unknowingly become another market dominated by giants. Previously, Baidu's music business merged with Taihe Music Group, China Music Group and Tencent Group merged their digital music business, and Shami Music and Tiantian Tiantian (renamed Alibaba Planet) integrated to form Ali Music.

But the Internet field is never short of dark horses. In the domestic digital music market, the current dark horse seems to be Netease Cloud Music. Just recently, Netease Cloud Music announced that it has recently completed Series A financing of 750 million yuan. After this round of financing, Netease Cloud Music is valued at 8 billion yuan.

Judging from the announced list of investors, Netease Cloud Music's intention to integrate industrial chain resources is very clear.

In an interview with reporters, Wang Chuanzhen believed that Netease Cloud Music is a rising star in the music industry. Starting from "music social", it has set four main development directions: UGC, song list, personalization, and commentary. This development direction has quickly brought user growth and product reputation.

In-depth competition tests the ability to integrate the industrial chain. In July 2015, the National Copyright Administration issued the "strictest copyright order" to crack down on online music piracy (Note: "Notice on Ordering Online Music Service Providers to Stop Disseminating Music Works without Subauthorization"), bringing the domestic online music industry on the track of legalization.

Before the emergence of the "strictest copyright order", many music platforms were in court over copyright issues. For example, QQ Music and Netease Cloud Music, Netease Cloud Music and Kugou Music have all sued each other. From then on until October 2015, QQ Music and Netease Cloud Music announced that they had reached a copyright strategic cooperation. QQ Music will transfer 1.5 million music copyrights to Netease Cloud Music. This case will be an "ice-breaking" for promoting copyright cooperation on more domestic digital music platforms. value.

For the current domestic digital music market, platform parties are gradually withdrawing from the chaotic copyright disputes, allowing them to have more energy to seek differentiation and explore profit models. Against the background of the "strictest copyright order" and the dominance of giants in the market, what new changes have taken place in the digital music market?

Wang Chuanzhen told reporters that there are two main changes in the domestic digital music market: one is to get out of the disorderly development of the industry where piracy is rampant and move towards an industrial development path driven by genuine music; the other is that the mobile music market has entered the industry increased by resource integration. The protracted battle is manifested in the fact that platform competition is no longer limited to the platform link, but extends to the entire music industry chain.

At present, almost all platforms have launched paid membership mechanisms, which still seems to be only an attempt. Most domestic users have not been accustomed to paying for listening to music on the Internet.

Wang Chuanzhen also bluntly said that in order to increase users 'willingness to pay, it is necessary to enhance the complexity of music and combine it more with industry chain links such as musician operations and fan entertainment to form a musician-centered, music distribution, program production, and exclusive concerts. Fan ecosystems supported by pan-music services such as online performing arts, such as Tencent Music Entertainment Group's "Ju·Xing Commune".

In her view, platforms are well aware of the core value of copyright resources and enhance copyright self-production capabilities by supporting original music. The difference lies in that Tencent Music boldly attempts to commercialize music based on its advantages in diverse music products (listening, watching, singing, and playing) and copyright resources. Ali Music belongs to Alibaba Entertainment and realizes the value of music through business collaboration (music + e-commerce, music + performances). Netease Cloud Music focuses on music social and strengthens the layout of the industrial chain by increasing investment in copyright resources. Taihe Music Group relies on the advantages of the industrial chain to empower the diversification of Baidu's music products.

Regarding the trend of this market, Wang Chuanzhen believes that copyright acquisition by each company will be transformed from agent to "agent + self-production", competition among platform vendors will intensify, and copyright resources will tend to be shared in the future; second, payment for content or platform services; Third, fan economy is exerting, and pan-music consumption is growing.