The Wall Street Journal reported on Wednesday that TikTok parent ByteDance is in talks with music labels to expand its music streaming service globally in order to compete with industry leaders such as Spotify.
According to people familiar with the matter, the company wants the service to eventually be integrated into its short-video service, TikTok, and to serve as a major platform for distributing music globally.
ByteDance has discussed in recent months to launch Resso, its music streaming service, which is currently only available in India, Indonesia, and Brazil, in more than a dozen additional markets, according to sources. The US would not be part of this next phase of expansion, but ByteDance said it wants the service to be available worldwide so users can discover songs in TikTok and then easily subscribe to the music.
The WSJ reported that the conversion rate from free to paid subscribers for Resso, which offers both a free, ad-supported tier and an optional subscription tier, was in the low single percentages. While Resso’s markets are known to be difficult for conversion, people familiar with the matter said, that compares with close to 45% of Spotify users globally who switch from the free service to paying.
While ByteDance is working to expand Resso’s markets, the company is also exploring and working on ways that Resso can be integrated into the TikTok app, the WSJ reported. Such an integration would make it easier for artists who market themselves on TikTok to earn more money via streaming.