Online K-song platform - sing it, it seems to be "troublesome" a lot lately.
First, at the end of last year, Sing Bar was included in the list of application software removed by the Ministry of Industry and Information Technology due to the problem of "collecting personal information beyond the scope". Then earlier this month, a number of media reported news about the sharp layoffs of Sing Bar.
Stretching the timeline, as the earliest player in China to enter the online K song market, Sing Bar has sprinted to the IPO three times, but for various reasons, Sing Bar has not been successfully listed.
Sing, what the hell is going on? Red Star Capital Bureau will re-sing about the road to commercialization for ten years.
(i)
Online k song: the first half of the joy, the second half of helpless
Speaking of singing, we have to mention Chen Hua, the founder of Sing bar.
Before founding Sing Bar, in 2006, Chen Hua founded Kuxun to locate the search website, but after the introduction of capital, Chen Hua gradually lost real power, and then left Kuxun and entered Ali as the head of the big search department. In February 2011, Chen Hua sent a Weibo post: "I just finished the resignation procedures, officially left Alibaba, and started my second entrepreneurial journey."
At first, Chen Hua did not know what he wanted to do, but he believed that if he did not come out to start a business, he would miss this wave of mobile Internet.
1. Debut and win a big victory
From November 2011 to January 2012, Chen Hua's entrepreneurial team has been meeting to discuss specific directions. According to public information, at that time, they listed some criteria: how big the market capacity, how many competitors, whether the product can think of innovative points, whether it can make money, whether it can achieve self-dissemination, etc. According to these standard screening directions, after five or six times, it was found that the K song direction is still in it.
As a result, Chen Hua officially led the team to do the K song business.
On May 31, 2012, Sing Bar was officially released on the App Store, and only three days after it was launched, Sing Bar rushed to the top ten of the APP store free charts, and on the fourth day, it climbed to the first place, and the number of users exceeded 10 million in half a year. By October 2013, Sing Bar had been online for less than a year and a half, and the number of users had exceeded 100 million.
The popularity of the singing bar far exceeded Chen Hua's expectations.
Of course, objectively speaking, the explosion of the singing bar is because it did gather "heaven and place" at that time.
On "good luck", when the first sing bar was launched, it was just in time for the hit of "The Voice of China", and the singing bar successfully hitched a ride. Secondly, the emergence of singing bar is also in the period when the mobile Internet began to break out, and singing bar also caught up with a good time.
In terms of product design, the popularity of the singing bar is also inseparable from its social attributes. When users use Sing Bar, they can not only share songs by themselves, but also comment on others, send flowers, and form an interaction. At the same time, in order to facilitate user registration, Sing Bar has opened a number of social platform accounts to log in, including the hottest people on the market, Weibo, WeChat, users can complete the song recording from Sing Bar and share it to the social platform with one click.
Here we need to highlight the cooperation between Sing Bar and WeChat, the two sides launched "WeChat Together, Sing Together" in July 2012! Large mobile phone K song competition. The way to participate is easy and simple, Apple and Android mobile phone users download the latest version of "Sing Bar" to share their favorite music works through "WeChat" as an entry.
At that time, it seemed that the cooperation between Sing Bar and WeChat was a win-win situation, and while Sing Bar enriched the playability of WeChat at that time, WeChat also introduced huge traffic to Sing Bar, which actually laid the groundwork for the next story.
2, the scenery will soon encounter a strong enemy
After the singing bar was launched, it was highly sought after by users, which made many "onlookers" want to share a piece of the pie, so similar K song tools followed, such as Renren, YY, Sina and other companies are focused on online K songs.
But these K-song platforms were not enough to shake the first-mover advantage of Singbar, until a software called National K-Song was officially launched, making Singbar feel unprecedented pressure, because behind this new player stands Tencent.
On August 26, 2014, the national K song officially opened for pre-order download, and was first released on September 1, 2014. In fact, for Tencent, doing the K-song business is not worthy of curiosity, and it can even be said that it is a matter of course.
First of all, in terms of social networking, the social chains of Tencent's owners, QQ and WeChat, have mastered the entrance to traffic. Secondly, Tencent also owns a large number of music copyright music libraries of QQ Music. Obviously, this innate advantage of singing bar can not be learned at all, and it is naturally difficult to compete with it.
After it was launched in 2014, the national K song used Tencent's social relationship chain to guide the flow with one click, as well as social fission spread such as the circle of friends. The national K song soon exceeded 100 million users, and the national K song was also regarded as the biggest opponent of the singing bar.
In December 2016, the total number of registered K songs announced that the total number of registered users exceeded 300 million, reaching the top of the mobile K song APP list, and the online K song industry has since ushered in a new boss.
According to Ai Media Consulting data, as of November 2020, in the field of online K songs, the national K songs ranked first with 165.91 million monthly independent devices, and the singing bar ranked second with 41.68 million monthly independent devices. The distance between the two has been greatly widened.
Chen Hua once mentioned the national K song in an interview, and replied like this: "We didn't have a dry father, he has a dry father, just such a difference." If you simply talk about the product, I think the product and user reputation of Sing Bar are not necessarily worse than it, but it is true that people are strong, and the comprehensive advantages are too strong, which we cannot compare."
Sing bar may feel a little unwilling and helpless in this battle, but sing bar still has to face reality after all. In the end, K Song has always been inseparable from the road of social networking, and in terms of playing social, Tencent had almost no opponents at that time.
(ii)
The road to self-help of "bumps all the way"
In the highlight moment when the singing bar was just launched, Chen Hua said publicly in an interview: "Through QQ interconnection, 50% of the users of the singing bar have been brought." Therefore, Chen Hua knows better than anyone that when Tencent enters the K song market, this game is doomed to win.
Soon, from 2014, Sing Bar began to embark on the road of "self-help".
First, at the end of 2014, the business of Sing Bar K Song shifted from online to offline, and invested in Mai Song KTV. At that time, Chen Hua set a goal, through the Internet gene of Sing Bar, coupled with Mai Song's offline entity business experience, Sing Bar Mai Song KTV plans to open to 2,000 within 5 years.
However, with the diversification of users' social entertainment scenes, such as pubs and script killings that have exploded in recent years, the living space of traditional KTV has become narrower and narrower. According to the data of Tianyancha, in 2021, the singing bar Maisong KTV has only opened more than 500 stores, far below the initial goal.
Source: Dianping
The offline KTV business of Sing Bar obviously did not go through. In 2015, Sing Bar turned to the game business again, trying to launch a mobile game called "Artillery Regiment". For why an online K song software to get involved in the mobile game industry, Chen Hua explained: "Sing bar the earliest game is inspired by Momo, back, look at the current user base of Sing Bar, if you choose a suitable mobile game, then the moon flow can be very high is also promising, so Sing Bar in this regard or made up its mind to try it."
However, the lack of game genes of singing bar still did not set off too much market wave on the game.
In the same year, Sing Bar introduced a microphone. In 2016, the contribution rate of the business to the singing bar was more than 5%. According to Chen Hua revealed in 2021, "The revenue of Sing Bar mainly comes from the rewards of Sing Bar software and the profit of hardware products such as Small Dome, and the proportion of the two revenue lines is basically the same." From the data point of view, selling microphones can be regarded as a more successful attempt to sing bar.
In addition, in the 2016 live broadcast war, Sing Bar also launched an independent live broadcast app - Mars Live. However, due to the choice of independent live broadcast app for the singing bar, mars live broadcast and singing bar users did not form a good interaction and drainage, and did not cause great repercussions.
From offline KTV to game business to hardware business and live broadcast business, Sing Bar seems to have never stopped expanding new business.
Chen Hua once said in an interview: "Today, I am actually very lonely standing in the position of CEO. Although I don't know how to get rid of anxiety, I will continue to look for the best answers in loneliness and stress, and I dare not slacken off easily. Since we can do our best, we can only do our best."
But for now, under the strong enemy, the stock market of online K songs is difficult to break through, the threshold of hardware equipment is low, the gross profit margin is low, and it cannot support the future of the singing bar, and the time left for the singing bar may not be much.
(iii)
Online K song, is it a good business
Chen Hua finally chose the online K song track after several months of discussion with the team in the early stage of the second venture, although later due to the entry of Tencent, the singing bar was hit hard in the field of online K songs in the later stage. But looking back, is online K song really a good business?
On February 12, 2018, Tencent Music Entertainment Group (TME. US) was successfully listed on the New York Stock Exchange, and the company's two main businesses include music streaming and social entertainment, covering four major products of Kugou Music, QQ Music, Kuwo Music and National K Song, with a total of more than 800 million monthly active users.
However, after its listing, Tencent Music has been called "a show company cloaked in streaming media" by many industry insiders.
The reason is mainly because Tencent Music's revenue banner has always been "propped up" by the platform of K songs for all. According to the financial report, tencent music's other entertainment service revenue accounted for 70.84% of the total revenue in 2018, which mainly refers to the virtual currency service income of the national k song.
Source: Company Financial Report, Red Star Capital Bureau
Although the national K-song business has made Tencent Music a not very good "reputation", it has also affected the valuation of Tencent Music. But in any case, this proves that the online K-song business can indeed make money, and it also makes Tencent Music's financial report look good in data.
However, judging from the recent development of Tencent's music entertainment sector, Red Star Capital Bureau found that the situation of the national K song is also not optimistic.
According to the financial report, in the third quarter of 2021, Tencent Music's revenue from social entertainment services and others was 4.92 billion yuan, down 6.4% year-on-year. In addition, the mobile monthly active activity of Tencent Music's social entertainment service in the quarter was 205 million, down 12.8% year-on-year; the number of paid users was 10 million, down 4.8% year-on-year; and the monthly ARPU (average user revenue) was 163.9 yuan, down 1.7% year-on-year.
If you pull the data back, in fact, the users of Tencent Music's social services have already touched the ceiling, and monthly active users have experienced negative growth for 6 consecutive quarters.
Source: Company Earnings Red Star Capital Bureau
Similarly, the number of payers for social entertainment services is also declining, and there have been 5 consecutive quarters of negative growth in the number of payers. In addition, the values of ARPU and ARPPU (average revenue of paying users) have declined.
Why is this happening? The reasons are manifold.
First of all, as far as the live broadcast industry is concerned, this track is already very crowded, and Douyu and Huya occupy the top position of the live broadcast industry. After the rise of short videos, Douyin, Kuaishou (01024. HK) relies on the huge traffic gathered by short videos and has become the main position of the live broadcast track. As an APP based on "show K songs", it has obviously lost its product competitiveness at the moment of users' diversified entertainment needs.
Secondly, it is also related to policy supervision, after the State Internet Information Office and other seven departments jointly issued the "Guiding Opinions on Strengthening the Standardized Management of Online Live Broadcasting", which clearly stated that online live broadcasting platforms should guide and regulate users' reasonable consumption and rational rewards in accordance with laws and regulations.
In addition, the K song live broadcast platform is closer to the show, so it is very easy to have a "edge ball" incident, which also damages the reputation of users of such platforms. On October 28, 2020, the Guangdong Provincial Office of "Eliminating Pornography and Cracking Down on Illegal Activities" and the Provincial Cyberspace Administration of China interviewed Tencent and ordered a comprehensive rectification.
Therefore, as far as the online K song platform is concerned, under the dual pressure of industry competition and policy supervision, it may not be a good business. As of the close of trading on March 10, 2022, Tencent Music closed at $3.95 per share, compared to the high of March last year at $32.25 per share, and the current total market value is $6.686 billion.
brief summary
Sing it for ten years, experienced the peak of debut, but also experienced the helplessness of being suppressed by strong enemies. Along the way, Sing Bar spends more time trying to find new paths. But now, even Tencent, the "fierce enemy" of Sing bar, is also under pressure in the music social sector. For singing, how many opportunities are left to trial and error?
Red Star News reporter Yu Yao Liu Mi
Edited by Yang Cheng
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