Photo/Shetuwang

Oct. 24 (NBD) -- Sony China announced on Tuesday the debut of its music platform named Sony Select, which is the first high-resolution (Hi-Res) music-streaming platform in mainland China.

As internet giants like Tencent (OTCMKTS: TCEHY) and NetEase (NASDAQ: NTES) have already gained a strong foothold in China's online popular music market, the Japan-stemmed firm decided to differentiate itself from its topping counterparts in audio quality, song library, and price, in a bid to stand out from the competition.

Sony Select will focus on jazz and classic music. Hiroshi Takahashi, chairman and president of Sony China, told 21st Century Business Herald in an exclusive interview that the company doesn't rule out the possibility of extending to popular music in the future, but it now hopes to lay a solid foundation and presents a clear positioning.

It's hard for the platform to scale up in a short period of time but it will build rather strong customer stickiness among financially capable users with high requirements for audio qualities, said Yin Shi, an audio analyst with big data consulting firm Analysys, to 21st Century Business Herald. Moreover, Zhang Yi, founder and Chief Executive officer of consulting agency iiMedia Research, stated Sony needs to find a balance between enlarging user scale and classifying users by price.

According to the Global Music Report 2018 released by the International Federation of the Phonographic Industry (IFPI), China saw its overall music revenue rise by 35.3 percent in 2017, ranking 10th in the world. This shows great potentials in the country's online music sector.

A report from Analysys revealed up to the second quarter of 2018, Kugou Music, QQ Music, and Kuwo Music, all backed by Tencent, have obtained 279.10 million, 272.04 million, and 119.23 million active users, respectively, ranking top three in China. NetEase Cloud Music followed with 89.37 million active users. Xiami Music from Alibaba (NYSE: BABA) and Qianqian Music (formerly as Baidu Music) only had 18.61 million and 9.44 million active users, respectively, lagging far behind Tencent and NetEase.

Statistics from Big-Data Research indicated Tencent-backed music platforms took the largest market share of 65.2 percent and 63.3 percent in terms of music download and online listening volume in 2017, followed by NetEase Cloud Music with 15.4 percent and 14.2 percent, Xiami Music with 9.2 percent and 9.3 percent, and Qianqian Music with 4.4 percent and 4.5 percent.

Sony is not the only one to search for a new ground in the online music market. Challenged by Tencent's dominance in the industry, NetEase Cloud Music is trying to explore a way out by announcing a strategic partnership with Baidu on October 12 to expand customer reach through Baidu's service platforms. 

Yin predicted the two tech giants may conduct business integration and upgrading in the future. But Zhang stressed they should make breakthroughs in supply chain and business models to enhance competitiveness. Zhang also added the landscape of the domestic online music market is far from finalization, and all competitors still stand a chance.

Email: wenqiao@nbd.com.cn