The musical market in China is one of the fastest-growing markets worldwide. In 2023, the sector’s revenue increased by around 25% compared to the previous year. The digital music industry represents the backbone of the music market. As of 2023, it had a revenue of more than RMB 32.2 billion (USD 4.5 billion). The trend of consuming online music is also on a fast rise, growing by around 33% compared to 2022. It was projected to reach almost RMB 50 billion in revenue by 2025. The constant rise of digital consumers and the increasing usage of artificial intelligence among creators are only a few of the reasons why music streaming platforms in China are gaining so much popularity among consumers. Thanks to these factors, creating music has gotten way easier and more accessible.
Gen Z sees music as a way to express their feelings
The digital music market in China shows a huge user base among netizens. As of 2023, around 715 million people listened to online music, which is more than 65.4% of all the country’s internet users. Furthermore, Gen Z represents the biggest chunk of online music consumers. As of 2022, more than 60% of digital music listeners in China were born after 2000. Younger people treat listening to music as part of taking a break from everyday life. They consider it as a special moment to avoid the dynamism of society. It is also a way to express their feelings with the infinite possibilities that only music can give.
The government enhances the auto-production of digital music
One of the reasons why the musical industry in China experienced fast development in recent years is linked to the strict protection of intellectual property rights. After the operation “Sword Net” (剑网) launched in 2015 to counter digital music piracy, the government enforced new rules concerning the theft of IP. In June 2021, the government revised the “Copyright Law of People’s Republic of China” for the third time since it was launched in 2020.
The amendment was mainly concerned with stricter control for broadcasting live concerts and music and implemented IP protection also for audio-visual content. Moreover, on October 11th, 2023, the “2023 China Digital Music Industry Conference” was held in Xiamen. During the event, many government representatives and music association leaders discussed the previous decade of reforms in IP protection. They underlined the importance of enforcing copyright laws and digital governance of IP protection through the music digitalization processes.
Tencent Music has the monopoly of the biggest music streaming platforms in China
Domestic companies represent the main players in the country’s digital music market. Tencent is not only one of the biggest tech giants in China. With a revenue of RMB 609 billion (USD 84.1 billion) as of 2023, Tencent also represents the vast majority of the music market. In particular, three of the most successful music apps are all owned by the company’s branch Tencent Music. As of 2023 Tencent Music had a revenue of more than RMB 27.7 billion (USD 3.8 billion), of which RMB 12 billion (USD 1.6 billion) were only from music subscriptions. With more than 350 million MAUs as of November 2023, KuGou Music was the biggest Chinese music streaming service, followed by QQ Music and Kuwo Player with, respectively, 329.5 million and 170.8 million MAUs.
With KuGou Music everyone can be an artist
Apart from being the biggest Chinese musical streaming service, KuGou music (酷狗音乐) is also one of the biggest platforms in terms of artists and singers, and its popularity is increasing year-on-year. The platform was launched in 2006. Thus, it is one of the oldest musical streaming platforms in China together with QQ Music. Many users choose this musical service for its numerous and various choice of songs. Only in 2023, the platform added almost 26 million new songs in its archives. It saw an increase by 26% compared to 2022.
Furthermore, KuGou Music is evermore open to young producers and artists. One of the most innovative programs launched by the Tencent-owned app is the “KuGou Musician open platform” (酷狗音乐人开放平台), a service where people can choose to enter the platform as a singer, a producer or a record label. As of 2023, more than 480,000 musicians joined this program, and around 50% of them were born between the 1990s and 2000s.
QQ music vs NetEase: the Tencent-owned service succeeded in attracting a younger audience
Founded in 2005 by Tencent Music, QQ Music (QQ音乐) is one of the biggest music streaming platforms in China. The peculiarity of this app lies in its user base. Indeed, QQ music is mostly used by millennials and Gen Z. In March 2023, Baidu conducted a survey on 1,000 users aged from 13 to 60 years old. It turned out that around 35% of the respondents who frequently used the app were aged 18-30, whereas the second category, aged 31 to 45 years old, represented 28%.
One of its fiercer competitors outside the Tencent music ecosystem is represented by NetEase cloud music (网易云音乐), a Chinese musical streaming service launched in 2013 by the Big Tech NetEase. As of November 2023, the app had almost 100 million MAUs, which is very far from the success of the Tencent-owned platform. Despite QQ music prices for subscriptions being a bit higher than NetEase, because they can cost up to RMB 38 (USD 5.2) for a three-month membership, while NetEase’s subscriptions cost RMB 34 (USD 4.7) for the same period. Thus, the Tencent affiliate is gaining more popularity than its rivals, especially for its skills to attract young consumers.
One of the reasons behind its success lies in the user interface. Indeed, QQ Music’s UI is more dynamic and has brighter colors than its rivals This makes it more attractive to younger users. Furthermore, while NetEase is concentrated on its “social part”, giving space to the community with threads and comments, the Tencent subsidiary gives more importance to the user experience and the sharing of new music.
Despite the limitations, Apple Music in China is raising consumers’ interest
Apple Music is one of the few foreign musical streaming platforms which are allowed in China. After entering the Chinese market in 2015, the app stood out among its competitors because of a collaboration launched with Douyin in 2018, when the Chinese social media platform joined the “Apple Music partner program”. After which, all Douyin users could have access to the Apple Music catalog while using social media. Hence, it music under the short videos. Despite its competitive prices for a monthly subscription, which is RMB 11 (USD 1.5) per month, Apple Music is not very popular among Chinese consumers because its collection of songs is quite limited.
Furthermore, there are other options that are not available for mainland China users, such as podcasts and radio. Apple is trying to close this gap with the other Chinese musical streaming services. As an example, in January 2024, Apple Music added an app allowing users to download classical music globally. This is to match Chinese consumers’ rising interest in this music genre. Initially launched in Hong Kong, it is also finding its space in mainland China. The initiative became immediately popular: as of April 2024, the hashtag “#苹果在中国推出AppleMusic古典乐#” (“Apple launches Apple Music classical in China”) has more than 36.9 million views on Weibo.
Music streaming platforms in China match the tastes of every consumer
- With a revenue of more than RMB 32 billion, the digital music industry in China represents the backbone of the musical market.
- Gen Z represents the biggest pool of consumers of the music streaming platforms in China. As of 2022, almost 60% of the total digital music listeners were born after 2000.
- The Chinese government has strict control over the digital music market, especially concerning the protection of intellectual property rights. Since 2015, it launched several initiatives and laws to discourage digital piracy and enhance digitalization in the market.
- Tencent Music holds the monopoly of the Chinese musical streaming industry. The three biggest streaming platforms are all owned by the Chinese colossus.
- KuGou Music is the biggest Chinese musical streaming service. As of November 2023, it had more than 350 million MAUs. The app became very popular because it allows everyone to become a creator. This was thanks to the “KuGou Musician open platform” program.
- Despite NetEase being the biggest competitor of the Tencent musical streaming ecosystem, platforms like QQ Music succeed better at attracting younger audiences.
- Apple Music is the biggest foreign musical platform which is not banned in China. Despite many features not working in the country, the company launched many initiatives to keep up with Chinese players. For instance, the classical music streaming app gained a lot of popularity on Weibo.
