Home / SmartTech / Tencent Music focuses on China’s crowded podcasting area – TechCrunch

Tencent Music focuses on China’s crowded podcasting area – TechCrunch

According to a survey by third-party marketing company iiMedia, an estimated 542 million listeners to podcasts, audiobooks, and other audio shows are heard in China this year. It’s a good jump from the 489 million users recorded in 2019, and it has undoubtedly attracted new players to the game.

This includes Tencent Music Entertainment (TME), the Tencent spin-off, which is sometimes viewed as Spotify of China, but differs in practice in many ways. The group̵

7;s main line of business goes beyond music streaming and includes virtual karaoke, live streaming and audio content. This category has been strongly promoted by the company recently.

In its recently released quarterly report, TME said it has made “significant progress in expanding” its audio library by adding thousands of new adaptations of popular IP tracks and works by independent producers. This intensifies competition in an already crowded room.

Like Spotify, TME is late for voice-based content, an umbrella term that can encompass everything from podcasts, audio books, radio stations to more innovative listening experiences such as live audio streaming. This sector in China has been occupied for years by the leading companies Ximalaya, the main investor in the San Francisco-based podcasting company Himalaya, and Lizhi, which is listed on Nasdaq.

TME’s push into audio is not immediately promising, as there is still no obvious path to profitability. Chinese users are known to be reluctant to pay for digital content, and when they publish podcasts for education and self-improvement, for example, enthusiasm wears off quickly. Deep-pocket platforms often offer free content to gain market share and relentlessly crowd out smaller competitors. The result is that everyone has to find more indirect ways to make money.

Lizhi, For example, revenue is mainly generated from selling virtual articles through interactive live audio sessions, while user subscription and advertising contributions remain poor. The seven-year-old company had no profit and had a net loss of 133 million yuan or $ 19.1 million last year.

Indirect monetization is nothing new in China’s Internet industry. Tencent, best known for its WeChat Messenger is particularly dependent on game revenue that is promoted by its social networking products. Likewise, TME gets most of its money from selling virtual articles on live music streams, while only 6% of the 657 million monthly active users of music streaming apps pay. MAU growth has also stalled as China’s online music market is saturated. From 2017 to 2020, TME only expanded its music streaming services by 50 million new users. The question is whether the music titan can breathe new life into the adjacent audio sector.

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