Tencent Music Entertainment
, the company announced in its first quarter earnings report on Monday . Although TME’s revenues declined 6.4% from the previous quarter, revenue from its music apps rose 34.5% to 2.75 billion yuan compared to the same period last year. Music accounts for only 35.1% of TME’s total revenue – social entertainment is the majority -- but represents a steadily growing share of its business. Subscribers to its music apps -- QQMusic, Kugou Music, Kuwo Music and WeSing -- grew by 4.9 million from 2020’s fourth quarter, the biggest sequential increase since 2016. Its “freemium” model is improving its conversion rate, the ratio of subscribers to both paid and free music app users. Subscribers represented 9.
Just as Western music services are jumping into podcasts, TME is making a hard push into long-form audio -- mainly audiobooks -- in what Cussion Pang, chairman of Tencent Music, said in a statement is an “evolution into an all-in-one online music and audio entertainment destination in China.” TME isn’t turning this plan into more money just yet: average revenue per subscriber dropped 1.1% to 9.3 yuan from the first quarter of 2020.
Also on Monday, Tencent Music announced that it renewed a licensing deal with Sony Music Entertainment. Tencent Music’s shares rose 0.6% to $15.30 on the Nasdaq on Monday, giving it a market capitalization of $25.9 billion. grew 40.2% to 1.69 billion yuan ; it rose 7.0% from 1.58 billion in Q4 2020.