Comparison Of Profit Models Of Digital Music Platforms

From the phonograph to the record,from Walkman to mobile phones,the form of music has undergone tremendous changes.Driven by the Internet and digital technology,music are going digital and many digital music platforms emerged.Internationally,there are music streaming platforms such as Apple Music,Spotify,and Amazon Music.In China,"one super and multiple strong" in the market pattern has taken place,that is,Tencent products are the first,Netease Cloud Music,ByteDance and other Internet enterprises are balancing with it.At present,digital music platforms have evolved from music players to more diversified forms,playing an indispensable role in people’s cultural life,copyright management and music industry value chain.However,problems are also gradually exposed.The market pattern is constantly changing,the industry dividend is gradually disappearing,and the competition is getting fierce.At the same time,the rising cost of copyright and marketing,poor user growth,and a single source of profit have put great pressure on the profitability of music platforms.They urgently need to re-examine the current profit model,find new breakthroughs,and expand a profit creation mechanism suitable for the current environment.Tencent Music Entertainment Group(hereinafter referred to as Tencent Music)is currently the largest digital music entertainment platform in China.With music as its core,it provides online playback and social entertainment services,creating a full-scene music experience that includes "discovering,listening,singing,watching,performing,and socializing.".Tencent Music was listed on the New York Stock Exchange in 2018,and is the world’s first profitable digital music company.Its successful experience is quite representative in the industry.Taking Tencent Music as the research object can complement research on the digital music industry and profit models,and can also provide reference for the future development of other platforms in the industry.This article conducts research on Tencent Music’s profit model,using normative methods such as literature research,case analysis,and comparative analysis to collect primary and secondary data from users and enterprises,research and analyze the key elements and interactions between them,summarize the main profit models of the platform,and identify the current risks.Besides,by comparing with Spotify,it analyzes the differences in the forms and development strategies of profit models in different markets,hoping to explore the reasons for the differences and provide new ideas about domestic digital platforms.An efficient profit model is the foundation of stable development for enterprises.It can deeply reveal all relevant stakeholders in enterprise operations,as well as the entire process of resource integration,value creation,value acquisition,and benefit distribution.The profit model of Tencent Music is an innovation of the traditional profit model under the guidance of the pan-entertainment development strategy.By summarizing the experience of Tencent Music and comparing international cases,the research finds that this strategy is more suitable for the current development environment,but it also needs to be optimized from the following points:optimize the platform’s operation and produce high-quality content;Diversify profit sources and expand music scenes;Build a content ecosystem and connect the product matrix;Fully develop the Long Tail market and unleash the content potential.Through the above approaches,we can help enterprises optimize their internal profit models,and provide new ideas for expanding the profit model and industrial development in the future.