Tencent Music’s Paying ratio increased to 9.9%, up from 8.0% and 9.0% in the third and fourth quarters of 2020, respectively. Its mobile MAU for online music platforms saw a decrease of 6.4% YoY in Q1 2021 to 615 million.

Tencent Music upgraded its products to be more social, personalized, and visually appealing during the first quarter of 2021:

• Putong Community has continued to gain popularity, growing in user penetration and retention rate quarter-over-quarter, and has become one of the leading channels for fan-idol interaction and content promotion.
• Kugou Fans Club has also drawn many leading artists, labels and content IPs to interact with their fans live, resulting in an increasing proportion of young users in this community, as well as sequential increases in penetration and time spent per user.

For long-form audio, it made noteworthy progress in both integrated and standalone approaches, as well as its monetization during the first quarter of 2021:

• After exceeding 100 million MAUs at the end of 2020, MAU penetration reached 20.0% compared to 5.5% in the first quarter of 2020.
• Significantly enriched long-form audio content offering with the number of licensed titles more than quadrupled year-over-year.
• Accelerated the addition of PUGC and UGC long-form audio content. QQ Music launched the Ground Zero Podcast program, which offers financial resources and tools that enable original podcast content creation.
• In March 2021, it completed the acquisition of Lazy Audio and started consolidation. It also integrated Kuwo Changting with Lazy Audio to form Lanren Changting in April, a new brand for Tencent Music’s long-form audio business
• It recently started its foray into ad-based monetization giving users easy access to a vast amount of high-quality audio content.

China online entertainment market overview 2021

Financial Highlights

Total revenues were RMB7.82 billion (US$1.19 billion), representing an increase of 24.0% year-over-year.

• Online music services revenues grew by 34.5% year-over-year.
• Revenues from music subscriptions were RMB1.69 billion (US$258 million), representing 40.2% year-over-year growth.
• Revenues from advertising services recorded over 100% year-over-year growth.

Net profit was RMB979 million (US$149 million) and net profit attributable to equity holders was RMB926 million (US$141 million). Non-IFRS net profit was RMB1.24 billion (US$188 million) and Non-IFRS net profit attributable to equity holders was RMB1.18 billion (US$180 million).

Kugou, QQ Music, and Kuwo are the top three online music mobile apps in China by MAU in March 2017. Kugou has close to 229 million monthly active users, closely followed by Tencent’s QQ Music with 211 million MAU.

163 Music (Netease) ranks the fourth, followed by Xiami, Baidu Music, Migu Music, and Alibaba Planet. Alibaba acquired Xiami in 2013 and folded it with another acquired Tiantian into one in 2015. It announced the formation of a division to focus on the music industry in 2015.

China mobile music apps users overview 2016

Kugou Music, QQ Music, Kuwo Music were the top three mobile music apps by total number of downloads in 2016 with 28.4%, 16%, and 13.9% market share respectively.

In 2016, Alibaba merged Xiami music with Tiantian Dongting and launched Alibaba Planet; Tencent merged QQ Music with China Music Group (Kugou Music, Kuwo Music, etc.) and launched Tencent Music Entertainment Grup (“TME”).

China mobile music app users reached 472 million in Q4 2016, an increase of 1.51%. 65.5% mobile music app users prefer listening to the local downloaded music to online streaming music.

Top sources of obtaining music information are search, top music rankings, and browsing by singers. Less than one-third of users discover music through recommended playlist, which indicates potential enhancement of mobile music app algorithms.

Almost 60% China’s mobile app users are willing to pay for online music services with an average monthly spend between 10 and 30 yuan.

Over half users heard of independent musicians in China in 2016; and, 54.5% follows the updates of independent musicians. 85.7% are willing to buy music from them. Different online music platforms launched various plans to cultivate and promote independent musicians.