ByteDance’s music app is a growing threat to Spotify, data shows
- TikTok parent company ByteDance launched music streaming app Resso in 3 markets in 2020.
- Resso now competes with Spotify in India and Indonesia, according to new data from Apptopia.
- If Resso expands into more markets, that could make ByteDance a significant rival to Spotify.
When TikTok’s parent company ByteDance launched standalone music
service in India in March 2020, it was unclear whether there would be room for a newcomer to the already crowded audio market.
When it launched, the company tried to differentiate itself as a social music app for Gen Z and Millennial users, sponsoring college music festivals to bring its offering to a younger audience. .
It added similar functionality to TikTok’s app, which at the time was already popular with young Indians, allowing users to add short videos (known as “vibes”) and comments to songs. And it’s tailored its content for a younger generation, categorizing 1990s music as “retro” in playlists, Gopika Panchmatia, a former programming manager at the company, told Insider.
“Someone born in 2000 and 22 years old is going to think 90s music is retro,” Panchmatia said.
Apart from Resso, ByteDance had already established itself as an important player in the music industry. The song’s trends on TikTok were shaping the Billboard 100 and Spotify Viral 50, and artists and record labels had begun using the app to promote new tracks to the app’s Gen-Z audience. Targeting that same young audience for a standalone music service seemed like a logical next step.
In India, the strategy paid off. Almost two years after Resso entered the country, new data shows that ByteDance’s music app is catching up with Spotify and other competitors in the country.
Over the past year, Resso has edged closer to Spotify’s market share in India in terms of monthly active users (MAUs) compared to other music streaming apps in the country, according to shared estimates. with Insider by analytics firm Apptopia.
Market share (by MAU) for 6 music streaming apps in India between January 2021 and January 2022 (source: Apptopia)
Resso is growing faster than Spotify in India.
The company saw 304% MAU growth between January 2021 and January 2022, compared to Spotify’s 38% MAU growth over the same period, according to data from app analytics firm Sensor Tower.
Resso operates in two other markets outside India: Brazil and Indonesia.
In Indonesia, it is also catching up with Spotify. Last month, it had around 8.3 million MAUs compared to Spotify’s 9.5 million MAUs in the country, according to Apptopia. Similar to its India rollout, the company also targeted younger users when it launched in Indonesia.
“When you marry the love of music with the habits of Gen Z and Millennials, you get Resso,” Tricia Dizon, country manager for Resso Indonesia, told Marketing Interactive in March 2020.
But it still trails Spotify in the third market in which it operates, Brazil, where Spotify leads. Apptopia estimated that Resso had around 9 million MAUs compared to Spotify’s roughly 28 million MAUs in the country in January 2022.
Neither Spotify nor Resso dominate in India, where local brands like JioSaavn and Gaana come preinstalled on users’ devices across the country. The country can support a multitude of audio streaming platforms due to its large population and wide diversity of languages, music genres, and customer segments.
But Resso’s particular ability to attract young users in India could pose a significant challenge for Spotify down the road. And it potentially foreshadows a battle that could happen in other markets like the US if ByteDance decides to launch a music app.
Why Resso’s Popularity With Young Users Could Cause Spotify Trouble
Resso’s early success with younger users, a demographic with which Spotify CEO Daniel Ek told Bloomberg he “could do better,” could pose a significant challenge to Spotify if ByteDance seeks to expand its brand. to more markets in 2022.
Spotify noted that ByteDance and TikTok were risk factors for its business in a public filing earlier this month, listing the two companies alongside YouTube and other brands as competitors “for users, the time of listening to users and advertisers”.
It’s unclear whether Resso will come after Spotify’s audio subscription revenue in other markets this year. ByteDance has not publicly announced any expansion plans for 2022, and it has previously been tight-lipped on where and when it will launch.
Spotify and Resso did not respond to multiple requests for comment for this story.
But TikTok has already cemented its position as a global hub for music discovery, and it’s easy to see a scenario in which the company could use the app to convert music fans into paying Resso subscribers in the whole world.
ByteDance followed that exact playbook to develop Resso in Brazil, incorporating a button to allow TikTok users to click on the Resso app when they heard a song they liked, The Information reported. The company intended to use TikTok as a promotional tool for Resso in India before the app was banned in June 2020 amid a geopolitical dispute between India and China, two elders told Insider. Resso employees.
“I think the biggest victory [for Resso] is the app’s interactivity and how easily it merges with social media, which is why it’s aimed at a younger demographic,” said Panchmatia, who also worked as a contractor at YouTube Music. last year at Insider.