Tencent Music outpaces Spotify in subscriber growth
Image credit: Donald Wu
China’s leading music streaming service, Tencent Music, is matching Spotify’s growth in subscribers despite their smaller user base.
Tencent Music Entertainment (TME), China’s leading music streaming platform, is seeing incredible growth. Despite having roughly half the number of paying subscribers, TME managed to match Spotify‘s subscriber growth in the first half of 2024.
Both TME and Spotify added approximately 10 million net paying subscribers during this period. The impressive growth represents not just Tencent’s impressive performance as China’s leading streamer but also the growth in China’s market of streaming consumption.
TNE operates popular platforms like QQ Music, Kugou, Kuwo, and the karaoke app WeSing. It’s subscriber base reached 117 million by the end of June 2024, compared to Spotify’s 246 million. However, TME’s rapid growth, driven by factors such as personalised experiences, exclusive content, and innovative features, is catching the attention of the industry.
TME’s Executive Chairman, Cussion Pang said: “With over 10 million net subscriber additions in the first half of 2024 and ARPPU expansion, we continue to break new grounds within China’s streaming landscape. We remain optimistic about the music industry’s long-term potential.”
While TME’s average revenue per user (ARPPU) is lower than Spotify’s due to differences in consumer spending power, the company has successfully increased ARPPU by introducing premium tiers like Super VIP. This tier offers exclusive benefits, including higher sound quality, priority access to content, and live event tickets.
Spotify CEO Daniel Ek recently revealed their plans for a super-Premium tier, offering users more features – including long-waited HiFi – at a higher cost. Spotify plan to charge just under 50% extra for their super-Premium tier, whilst Tencent’s Super VIP costs 5x more. Their success suggests for the right benefits, users are willing to pay more.
TME’s focus on user experience and innovation has paid off. The company has invested heavily in AI-powered technology to enhance music discovery, sound quality, and content creation. Additionally, TME’s emphasis on original content and exclusive partnerships has helped drive subscriber growth and engagement.
Despite facing challenges in its social entertainment division due to regulatory changes, TME’s overall financial performance has been strong. The company reported an operating profit of RMB 2.20 billion ($302 million) in Q2 2024, a 42.8% year-over-year increase.
TME’s success serves as a testament to the potential of the Chinese music market. As the company continues to innovate and expand its offerings, it is poised to become a major player in the global music industry.
Artists around the world can be part of the impact that TME and Spotify are having in music around the world. Upload your music releases for free to gain global exposure on these growing platforms and earn revenues from every play.