- In emerging markets, TikTok owner ByteDance Inc. is testing a new music app called Resso as it attempts to pull off another global feeling similar to its viral video sharing service.
- ByteDance, the most valuable start-up in the world, has quietly developed the app to challenge the likes of Spotify and Apple Music in countries where paid music services still need to attract large audiences.
In emerging markets, TikTok owner ByteDance Inc. is testing a new music app called Resso as it attempts to pull off another global feeling similar to its viral video sharing service.
Called Resso, the new app is now available in India and Indonesia, two of the most populated countries in Asia and areas that already know TikTok well. Resso has been downloaded by about 27,000 users throughout the iOS App Store and Google Play since its initial launch six months ago, according to data compiled by Sensor Tower, which said the numbers indicate that the app’s promotion began in earnest at the end of November.
ByteDance, the most valuable start-up in the world, has quietly developed the app to challenge the likes of Spotify and Apple Music in countries where paid music services still need to attract large audiences.
“The dilemma for all three companies is how to monetize a price-sensitive user base with low relative income,” said Michael Norris, Shanghai-based consulting agency China’s research and strategy manager. “It’s a race in the developing world for active users at the moment. Commercial realities, at least for now, will be put aside.
Like Spotify, Resso shows lyrics in real-time and allows users to post their feedback in individual songs. They can also generate GIFs and videos accompanied by music, emulating TikTok’s favorite feature. The app provides a monthly paid subscription package in India costing the same as Spotify 119 rupees ($1.70). Users of Premium Resso can download music and listen to it free of charge.
The company based in Beijing has secured rights from T-Series and Times Music labels in India, previously reported by Bloomberg News.
Yet there are still no rights agreements with the world’s three largest music companies — Warner Music Group Corp., Universal Music Group, and Sony Music Entertainment — that control the vast majority of popular music and whose catalogs, according to people familiar with the topic, would be essential for Resso to catch on globally. Record companies are crediting TikTok with minting a new generation of music stars, including “Old Town Road” singer Lil Nas X. Since it has attracted hundreds of millions of users with their music, these companies are now demanding ByteDance to increase the licensing fees it pays.
“Resso is currently in a process of beta testing,” a representative from Resso said in a statement. “We’re optimistic about its long-term prospects, but we’re still very early in the process and only in a limited number of developing markets.”
ByteDance was partially valued at $75 billion last year as investors are confident of its reputation as a mobile app factory. But after TikTok and news aggregator Toutiao, its first signature app, the seven-year-old startup is still on the lookout for its next major breakout hit.
ByteDance also seeks to expand its revenue stream beyond advertising with the paid music app to counter a slowing home economy that has dampened the appetites of advertisers.
TikTok has been built almost 1.5 billion times since its release in 2017, a remarkable international achievement for a Chinese Internet service. According to Sensor Tower, new U.S. users grew 38 percent to 11.6 million a year earlier, up from 8.4 million a year earlier.
But its Chinese ownership has become a vital lightning rod as tensions rise over trade and technology between the U.S. and China. American politicians and teen users alike have voiced concern about the app’s treatment of user data and politically sensitive speech censorship.
Testing out Resso in its chosen markets gives ByteDance the breathing room to scale up the service slowly and out of the intense spotlight that’s placed on its other services.