Tencent launched its music streaming platform Joox a year ago and is now expanding its services to provide more video-based content for subscribers.
Poshu Yeung, Tencent’s general manager, international business and head of Joox, says the Asian streaming market is changing at twice the rate of the west and that Tencent, with its ability to cross-pollinate with messaging app WeChat, is well placed to fend off competition from the likes of Spotify.
How has music streaming developed in Asia and how has Joox ensured it’s been a part of that? Is this being challenged by the likes of Spotify?
It’s interesting how the Asia market is developing differently from the rest of the world, and McKinsey has identified several ways in which that’s happening. For example, in Western markets it took two years for digital music to overtake physical sales, and another two years for streaming music to exceed download services, according to McKinsey. In Asia, however, both shifts have happened in a single year. Joox has a sweet spot in Asia. We have the scale to leverage big data and the relationships we enjoy with both music labels and mobile operators, but we also have the local understanding and focus to provide locally curated content and experiences that appeal to Asian music lovers.
What is the monetisation model? And how has that changed?
Joox has been launched for just over one year and so far, we’ve been focused a lot on maximising the user experience. We have started rolling out advertising solutions in recent months. We’re working hard to strike the right balance between advertising and the user experience. As a result, we have created some innovative campaign programs such as world music days with Coca-Cola in Thailand and FWD Insurance in Indonesia. We’re also growing revenue from paid subscriptions both online and using other means such as telco collaboration and top-up cards at major convenience stores.
How are you allowing other brands to become involved?
We’re already working with brand marketers to create customised experiences for consumers, from subsidised premium subscriptions, to branded themes for the Joox app, such as Coach in Hong Kong. We’re also working closely with the labels to create platforms for them to meet local audiences’ appetite for value added content. For example, we’re working with Tim Tam in Hong Kong to create a Tim Tam branded van doing mobile live streaming events with popular artists around the city. It’s a great example of creating a branded advertising solution comprising both online and offline elements.
How does Joox fit into other Tencent platforms? Do brands work across platforms with Tencent?
We’ve made it very easy for Joox users to share songs at WeChat Moments or directly with their WeChat friends and other social media platforms, such as Facebook. We can build packages for advertisers using other Tencent services such as WeChat to help them engage in more meaningful and effective ways. Mobile phone brand OPPO, for example, has successfully used Joox to increase the number of followers to its official WeChat account. And on the back end, of course, we’re able to continually learn more about consumer preferences across the range of Tencent offerings, which gives us a significant advantage in being able to further localise and customise.
What’s next for the platform? Why expand into the video space?
Live performances and appearances are an integral part of the way many people consume music, so it’s logical for us to begin to build a live video streaming element into our service. We’re also looking at other ways to enhance user enjoyment from a “pan-entertainment” perspective. In other words, we’re interested in serving users with any form of entertainment content, not limited to music or video.
What about new territories? Will you challenge Spotify etc elsewhere?
We’re not really concerned about any one competitor, and try to focus on developing services that meet local consumer preferences. In terms of territories, we’re not making any announcements right now.