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Speaker 1: Welcome to another episode of Strictly Business, the podcast in

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Speaker 1: which we speak with some of the brightest minds working

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Speaker 1: in the media business today. I'm Andrew Wallenstein, chief media

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Speaker 1: analyst at Illuminate and a variety contributor. It's K pops world,

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Speaker 1: and we're just living in it right. The South Korea

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Speaker 1: based music phenomenon is well into its global domination and

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Speaker 1: twenty twenty six may kick it into higher gear than

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Speaker 1: ever with some major album releases coming. But K pop

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Speaker 1: is really only part of a much bigger music movement

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Speaker 1: emanating from many different parts of Asia. And to get

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Speaker 1: the full picture on what's coming from that continent, I've

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Speaker 1: got my Illuminate colleague, analyst Robert Steiner with me today.

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Speaker 1: He's the author of the new Illuminate special report Asia

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Speaker 1: a Global Force in Music, which is available for us

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Speaker 1: on illuminatedata dot com. Rob thanks for joining me, Hi,

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Speaker 1: thank you for having me cool. So let's get into it.

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Speaker 1: The report you did explores how Asia has become one

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Speaker 1: of the most influential frontiers in the global music industry.

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Speaker 1: And there's explosive streaming growth, resilient physical sales, massive local

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Speaker 1: fan cultures, and it's all reshaping how music is made, monetized,

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Speaker 1: and exported. So as you approached this, I'm just curious,

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Speaker 1: did you have any maybe misconception about what this continent

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Speaker 1: was to the music market, and how did this report

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Speaker 1: change your views?

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Speaker 2: I would say probably the idea I had going into

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Speaker 2: this report is probably the same idea that a lot

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Speaker 2: of people in the West, or at least outside of

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Speaker 2: Asia probably have, whereas like, basically, the Asian industry is

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Speaker 2: music industry is pop, you know, or at least if

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Speaker 2: we're talking about like it's global presence, that it is

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Speaker 2: defined by kpop. And while yes, that is a huge

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Speaker 2: part of it, as I look into the report, you know,

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Speaker 2: it became pretty clear that that notion is in the

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Speaker 2: midst of some pretty significant change because, you know, as

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Speaker 2: a result of the streaming era, and you know, stuff

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Speaker 2: I've covered in the past of like streaming markets being

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Speaker 2: established in you know, new regions or countries, which then

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Speaker 2: leads to, you know, the the globalization phenomenon that we

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Speaker 2: see a lot where local artists and sounds end up

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Speaker 2: getting platformed on streaming platforms as locals adopt streaming but

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Speaker 2: kind of maintain their you know, usual listening habits, which

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Speaker 2: then allows these stars to kind of get picked up

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Speaker 2: by the algorithms and the playlist and then sort of

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Speaker 2: achieve this Internet national level of visibility and recognition that

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Speaker 2: we haven't really seen up until now. That is basically

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Speaker 2: that's what happened to k pop. You know, it went viral,

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Speaker 2: It gained an international audience in a remarkable amount of time,

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Speaker 2: and it happened at a time where this whole the

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Speaker 2: whole idea of glocalization with just starting to sort of

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Speaker 2: take off, and now we're sort of seeing like other

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Speaker 2: key markets in Asia follow suit almost where now they're

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Speaker 2: sort of on the precipice of their own opportunity to

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Speaker 2: go global, basically where you know, they've maintained this local

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Speaker 2: identity and this very domestic focused market in a lot

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Speaker 2: of cases, and now with streaming sort of becoming popular

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Speaker 2: in places like India, in Japan and China, they are

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Speaker 2: sort of in the position that South Korea was in

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Speaker 2: about you know, seven eight years ago. And so that

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Speaker 2: was basically my main takeaway, where like Cape is sort

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Speaker 2: of the focus of the discussion when we're talking about

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Speaker 2: Asia on the global music stage, but after this, like

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Speaker 2: I'm pretty confident that that won't be the case for

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Speaker 2: much longer.

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Speaker 1: Interesting, and we'll get in more detail to what's going

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Speaker 1: on in Japan and India and China, But let's stay

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Speaker 1: on K pop for a little bit longer, because as

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Speaker 1: I set off the top, twenty twenty six is poised

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Speaker 1: to be a pretty big year. And it wasn't like

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Speaker 1: twenty twenty five was a small fry either. And when

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Speaker 1: I think about twenty twenty six, three letters come to mind,

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Speaker 1: b T, and S. But it's more than that. So

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Speaker 1: tell me about twenty twenty.

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Speaker 2: Six in short, Like, even though it were only you know,

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Speaker 2: a couple months into twenty twenty six, like, it's pretty

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Speaker 2: clear that it's going to be a monumental year for

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Speaker 2: the capop industry solely because of BTS. Really, you know,

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Speaker 2: for those who don't know, BTS has been sort of

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Speaker 2: on a hiatus of sorts for the past few years.

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Speaker 2: The members basically had to report for their you know,

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Speaker 2: mandatory military service in South Korea, which basically forced them

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Speaker 2: to sort of hit the brakes at they're like peak.

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Speaker 2: But what is really interesting about them is that they have,

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Speaker 2: you know, in most cases, like a pop act going

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Speaker 2: away for three four years. You know that in some

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Speaker 2: cases that's considered like retirement at that point, but with BTS,

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Speaker 2: their audience has stayed incredibly passionate. If not, it's gotten

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Speaker 2: more passionate because of just this weight for the band

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Speaker 2: to get back together. So basically, like you know, we're

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Speaker 2: about a month away from their album coming out, but

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Speaker 2: we already know that they have a Netflix documentary on

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Speaker 2: the way, The kickoff show is going to be live

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Speaker 2: streams on Netflix. Their entire stadium tour is already sold out,

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Speaker 2: So that alone is like gonna take the K pop

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Speaker 2: industry to honestly a whole other level. And like, even

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Speaker 2: though twenty twenty five was like still a pretty a

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Speaker 2: pretty big year for the industry, it was comparatively a

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Speaker 2: slower one. It was sort of like the one of

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Speaker 2: the most mellow years since it's sort of like, you know,

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Speaker 2: took off on this global on this global level, but

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Speaker 2: one of the areas that didn't see any sort of

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Speaker 2: last momentum was live music. So I think like that's

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Speaker 2: going to continue to be the case with as BTS

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Speaker 2: shows that the K pop tour is more so than

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Speaker 2: the album. It seems like now sort of becoming like

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Speaker 2: the cornerstone of the industry, where like, you know, one

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Speaker 2: of the most successful tours last year was Black Pink's tour.

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Speaker 2: Also them coming off of like, you know, a few

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Speaker 2: years taking a break. They went off to do solo careers,

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Speaker 2: so they were still busy, but this was their first

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Speaker 2: time back together in a few years, and that ended

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Speaker 2: up being incredibly successful. You know, the total gross for

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Speaker 2: kpop tours was like more than double that of twenty

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Speaker 2: twenty four, So I think like that's BTS was really

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Speaker 2: indicative of sort of like I think where the K

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Speaker 2: pop industry is going to go for twenty twenty six.

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Speaker 2: And if that is certainly the case, it's you know,

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Speaker 2: all signs are pointing upward.

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Speaker 1: Sure, I mean, the way we're hyping this up, I'm

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Speaker 1: expecting a phenomenon of swifty in proportions. But let's also

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Speaker 1: you know, nothing's perfect, nothing lasts forever. And then so

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Speaker 1: I'm curious, as you look out at say the next

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Speaker 1: five years for the K pop ecosystem, what do you

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Speaker 1: think might be a risk that it faces that could

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Speaker 1: perhaps bring some wind from its sales.

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Speaker 2: I mean, basically, what from what I could tell based

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Speaker 2: on what I researched in the you know, people in

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Speaker 2: the South Korean music industry that I talked to. The

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Speaker 2: K pop industry is very much in uncharted territory at

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Speaker 2: this point. You know, we're about a decade roughly since

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Speaker 2: the genre became this global phenomenon that you know that

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Speaker 2: it is today. And so it seems that one of

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Speaker 2: the biggest questions, or at least one of the most

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Speaker 2: existential questions for the industry right now that they're still

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Speaker 2: attempting to answer, is what what does K pop even mean?

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Speaker 2: Now that it has gone from this you know, domestically

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Speaker 2: focused genre to this you know, globally appealing, international mega hit,

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Speaker 2: you know, this like monumental force. And so we're sort

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Speaker 2: of seeing in the past year we started to kind

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Speaker 2: of see almost like two answers to this question in

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Speaker 2: a way. On one hand, you have the the big

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Speaker 2: four agencies sort of like the big four companies that

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Speaker 2: are driving this whole K pop machine. Their answer seems

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Speaker 2: to be that like from here, k pop's global era,

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Speaker 2: like it's global identity, will be defined by the systems

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Speaker 2: that it takes to create these stars, you know, where

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Speaker 2: like for companies like Hibe, you know, they've built these

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Speaker 2: what they call like global k pop groups, you know,

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Speaker 2: and we've seen that with Katsi, which is a you know,

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Speaker 2: American US based girl group of you know, multiple nationalities

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Speaker 2: that's like very much meant to appeal to Western markets.

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Speaker 2: They're trying a similar approach with Santos Bravos, which is

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Speaker 2: a boy band of all members of Latin American descent

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Speaker 2: singing in Spanish. They have plans to do the same

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Speaker 2: sort of model for India and Africa and the next

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Speaker 2: you know, in the near future. And the through line

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Speaker 2: with all these groups is that they kind of take

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Speaker 2: the visual aesthetics and the sort of like rigorous training

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Speaker 2: that is associated with you know, the k pop idle system,

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Speaker 2: you know, where like k pop like very much is

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Speaker 2: like by the time an artists releases their first album

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Speaker 2: or group releases their first album, they are a fully

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Speaker 2: formed idle and they have gone through years of rigorous

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Speaker 2: training up until that point. So they're sort of taking

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Speaker 2: that structure and that artist development system and now applying

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Speaker 2: it to you know, appeal to specific markets other than

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Speaker 2: South Korea. So for them, that's one answer where the

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Speaker 2: K pop's identity and its global era will be part

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Speaker 2: will continue on through the system, you know, the system

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Speaker 2: surrounding the artists. But then on the other hand, we

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Speaker 2: had the biggest hit, the biggest K pop related hit

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Speaker 2: of twenty twenty five, in K Pop Demon Hunters, which

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Speaker 2: was made fully outside of the K pop system. It

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Speaker 2: was a team predominantly led by a Korean American production team.

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Speaker 2: It is, you know, the songs were written by artists

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Speaker 2: who like came up in the kpop system, but weren't

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Speaker 2: like actively involved in it. And that almost sort of

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Speaker 2: represents an alternative answer to that question where even in

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Speaker 2: its global era, Kpop Demon Hunters kind of argues that

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Speaker 2: its identity is still sort of rooted in its koreanness.

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Speaker 2: Where you know, that movie and the soundtrack was very

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Speaker 2: much a throwback to like the early days of K pop,

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Speaker 2: or at least the early days of K pop, like

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Speaker 2: on a global level, you know, back when circa twenty eighteen,

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Speaker 2: when it was just starting to go viral, and a

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Speaker 2: lot of these artists and songs were still ultimately aiming

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Speaker 2: for South Korean markets but just happened to take off globally, whereas,

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Speaker 2: like you know, now a lot more songs are being

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Speaker 2: sung in English, we're seeing a lot more guest spots

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Speaker 2: on K pop songs from Western artists, and k Pop

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Speaker 2: Demon Hunters was almost like sonically anesthetically a throwback to

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Speaker 2: before all of that, and that ultimately resonated with a

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Speaker 2: lot of like longtime K pop fans who have started

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Speaker 2: to sort of feel a little disconnected from the current

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Speaker 2: output of K pop, which like is starting to you know,

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Speaker 2: broaden its arises in terms of audience targets and focus,

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Speaker 2: and it sort of brought it back to, you know,

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Speaker 2: a different era of the genre that was ultimately still

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Speaker 2: very much rooted in its Korean identity. So that's sort

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Speaker 2: of what we're going to see, I think continue, where Like,

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Speaker 2: now that k pop has had such an international foothold,

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Speaker 2: it has now bred, you know, a generation of fans

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Speaker 2: that are now coming up and making their own projects.

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Speaker 2: And k Pop Demon Hunters was like, even though it

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Speaker 2: wasn't part of the K pop system, it was very

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Speaker 2: much a love letter to the genre by people who

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Speaker 2: were very you know, well versed and well knowledged in

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Speaker 2: the culture, even though they you know, didn't grow up

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Speaker 2: in Korea, and not all of them. So I think

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Speaker 2: that's ultimately what we're gonna see and the biggest question

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Speaker 2: will be, like how the K pop industry, you know,

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Speaker 2: reacts to sort of these outside influences playing a part

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Speaker 2: in the industry, because, like, the K pop industry has

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Speaker 2: historically been very well guarded, you know, they've been very

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Speaker 2: careful about like what defines k pop, and we're starting

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Speaker 2: to sort of see like, as a result of its

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Speaker 2: global appeal of like this new you know, these crossroads

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Speaker 2: forming between like the cat size of the world and

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Speaker 2: the K pop demon Hunters of the world, so that

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Speaker 2: I think that'll be the most interesting thing that's going

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Speaker 2: to define K pop in the near future.

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Speaker 1: We should note a subtle connective thread in some of

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Speaker 1: the things you're saying when you bring together what's happened

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Speaker 1: with k pop Demon Hunters, what's happened with Kat's Eye,

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Speaker 1: and what could be happening this year with BTS, and

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Speaker 1: that is Netflix. They it seems like this is a

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Speaker 1: place where K pop has really taken things to a

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Speaker 1: whole other level.

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Speaker 2: The Netflix connection is definitely interesting, and it does make

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Speaker 2: a lot of sense where Netflix does seem to be

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Speaker 2: sort of dipping its toes a little bit into music

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Speaker 2: adjacent content. You know, they last year launched a partnership

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Speaker 2: with Spotify. They did some you know, they've done documentary

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Speaker 2: music documentaries. They most recently did sort of this like

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Speaker 2: short film one shot thing with Ed Sheeran. And on

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Speaker 2: top of that, like they've also been waiting it a

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Speaker 2: lot into a live TV as we've mostly seen with

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Speaker 2: like you know, they're boxing matches. But I think this

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Speaker 2: BTS show that they are live streaming is probably I

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Speaker 2: very much see that in a similar vein where like

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Speaker 2: this is ultimately part of their continued vision to become

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Speaker 2: like this multimedia content machine, and I think K pop

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Speaker 2: kind of serves well for that because of its broad

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Speaker 2: international appeal and you know, probably like BTS I would say,

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Speaker 2: is very comfortably up there with like Taylor Swift and

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Speaker 2: Bad Bunny in terms of like the most recognizable global

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Speaker 2: artists of that caliber. You know. So I think it

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Speaker 2: ultimately makes a lot of sense that they're hitching their

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Speaker 2: wagon to K pop.

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Speaker 1: Well, we've certainly given k pop its flowers in this conversation,

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Speaker 1: but central to this new report for Illuminate that you

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Speaker 1: did Asia a global force in music, which again free

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Speaker 1: to download on the Illuminate that at a website. It

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Speaker 1: paved the way K pop for other markets in Asia

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Speaker 1: to follow a similar formula. So let's turn from K

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Speaker 1: pop to say jpop, which I didn't make that up.

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Speaker 1: That's a movement coming out of Japan. Give me the

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Speaker 1: comparison and perhaps the differences in these markets.

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Speaker 2: So important distinction right off the bat is this is

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Speaker 2: a little confusing to stay with me. Jpop basically it's

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Speaker 2: sort of the catch all term for the entire Japanese

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Speaker 2: pop music world, you know, so it encompasses not just

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Speaker 2: like idol groups, it encompasses rock in punk and dance

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Speaker 2: music and electronics, so it is it's more of just

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Speaker 2: like a term for the industry, whereas K pop is

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Speaker 2: k pop, So like that is one thing. But you know,

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Speaker 2: another thing is that Japan really is an incredibly or

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Speaker 2: the jpop industry too, is like an incredibly unique position

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Speaker 2: right now where you know, according to the IFPI, Japan

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Speaker 2: is the second largest global music market as of twenty

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Speaker 2: twenty five. They've been that way for quite a while. However,

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Speaker 2: they have grown to this size by basically being almost

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Speaker 2: like almost exclusively domestically focused, you know, whereas South Korea

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Speaker 2: have found this explosive growth by becoming you know, the

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Speaker 2: headquarters for a global genre. Japan has not really had

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Speaker 2: to do that, you know, due to its population size.

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Speaker 2: It's you know, strong culture around like the arts in general,

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Speaker 2: they have sort of been able to keep their sites

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Speaker 2: inward in terms of expanding the music industry. And as

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Speaker 2: a result of that, like you have artists in Japan

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Speaker 2: that get billions of streams, but then you look at

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Speaker 2: like the our Illuminate data and literally like ninety eight

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Speaker 2: and ninety nine percent of those streams are coming just

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Speaker 2: from Japan. Wow. This really does set the stage for,

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Speaker 2: you know, for for Japan to sort of follow suit

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Speaker 2: North Korea or follows South Korea's lead of going global,

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Speaker 2: you know, sort of in the same fashion as K pop.

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Speaker 2: But they also have, like as a result of this

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Speaker 2: domestically focused but massive music industry, they have a really

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Speaker 2: unique caliber of music and artists coming out of the

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Speaker 2: country or that have the potential to come out of

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Speaker 2: the country. And so that's sort of like what we're

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Speaker 2: starting to see again now that streaming has sort of

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Speaker 2: started taking hold in Japan, and you know, well, I'm

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Speaker 2: sure we'll talk about like Japan's unique relationship to physical

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Speaker 2: media in a second. But basically now that's streaming, it's

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Speaker 2: finally taking off in the country. We're started starting to

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Speaker 2: see the Japanese the jpop industry basically start setting its

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Speaker 2: sites globally and starting to kind of want to follow

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Speaker 2: suit in K pop's lead a little bit and make

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Speaker 2: that jump to international markets.

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Speaker 1: But as you just said, another peculiarity of the Japanese

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Speaker 1: market is physical sales are what.

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Speaker 2: The CD never went away in Japan as a branch.

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Speaker 2: That was basically the most surprising thing that I learned,

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Speaker 2: you know, looking into into the the country's you know,

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Speaker 2: unique music world, where like the CD and physical sales

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Speaker 2: in general is still very much a cornerstone of the

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Speaker 2: music industry. There. Part of that is, you know, just

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Speaker 2: the very unique, passionate culture of super fandom in Japan.

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Speaker 2: They have their own word for it, it's oshikatsu, and

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Speaker 2: it's basically like there is still very much a passion

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Speaker 2: with fans for like buying merchandise, buying CDs, you know,

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Speaker 2: getting the you know store exclusive variants of albums and stuff,

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Speaker 2: kind of like the Taylor Swift model, but like that

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Speaker 2: is a lot more prominent, like across genres in Japan.

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Speaker 2: So you know, like one one metric that stuck out

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Speaker 2: to me is that in twenty twenty four, around sixty

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Speaker 2: two point five percent of Japan's recorded music market came

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Speaker 2: from physical sales. Compare that to you know IPI's global

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Speaker 2: global look, and only around sixteen point four of global

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Speaker 2: recorded music revenue for twenty twenty four came from physical So, like,

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Speaker 2: that is a very noted distinction between Japan and the

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Speaker 2: rest of the world. So that is also another reason

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Speaker 2: why Japan's music market is just so unique.

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Speaker 1: Let's turn to another market, India, which is known for

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Speaker 1: its enormous scale, but monetization lags behind consumption. So what's

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Speaker 1: going on there that explains that disconnect?

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Speaker 2: So I would say out of all of the countries

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Speaker 2: I reported on, India is probably in the most unique

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Speaker 2: position and possibly one of the most like exciting positions

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Speaker 2: for you know, music industry nerds like me to look

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Speaker 2: at and you know, observe where you know, based on

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Speaker 2: what I researched and people in India in the music

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Speaker 2: industry that I talked to, Historically, India's music industry has

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Speaker 2: been like inextricably tied to the film industry, you know,

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Speaker 2: not just Bollywood, but like, you know, just the film

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Speaker 2: industry in general, where the main mode of discovery for

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Speaker 2: consumers for music has been through film, you know, where

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Speaker 2: you think of Bollywood films and just in other types

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Speaker 2: of Indian films where like musical numbers are very much

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Speaker 2: a thing in it, and that's just sort of been

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Speaker 2: how the music market has operated in They're really like

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Speaker 2: as a result of that, there hasn't really been a

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Speaker 2: music culture that like we see in other markets, like

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Speaker 2: in the US, where there is sort of this like

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Speaker 2: you know, we don't in India. There isn't sort of

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Speaker 2: as much a demand for like the artists so much

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Speaker 2: as like the song from the movie you know, so

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Speaker 2: like it was almost sort of seen as like a secondary,

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Speaker 2: a secondary type of thing, with Bollywood type movies being

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Speaker 2: the main, the main attraction. But in just the past

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Speaker 2: five years we sort of seen in a perfect storm

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Speaker 2: of factors, streaming has exploded in the country. For one thing,

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Speaker 2: albeit you know, it's mostly driven by ad supported revenue

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Speaker 2: versus premium revenue. That's the next major challenge, but regardless,

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Speaker 2: it is being adopted at a very high rate. The

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Speaker 2: pandemic basically brought all film productions and releases to a halt.

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Speaker 2: And as we're seeing in basically the rest of the world,

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Speaker 2: you know, we're gen z entertainment consumers are increasingly preferring

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Speaker 2: like online social content over traditional media as their go

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Speaker 2: to form of entertainment. You know, even though TikTok is

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Speaker 2: banned in India, they still use other platforms like Instagram, namely,

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Speaker 2: So as a result of all of these factors, we're

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Speaker 2: starting to see sort of the roots of an artist

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Speaker 2: driven music culture form in the country, you know. Where

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Speaker 2: now it's like artists are able to more easily gain

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Speaker 2: a following and build momentum without having to you know,

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Speaker 2: strike a film deal or get their song in a

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Speaker 2: in a movie. You know, they're able to sort of

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Speaker 2: like get local hype through you know, social video or

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Speaker 2: just like building communities online and then doing local shows.

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Speaker 2: So it is in a really interesting position in that

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Speaker 2: regard where like it is like we're just starting to

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Speaker 2: see this type of culture take hold, but at the

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Speaker 2: same time, it is also like on the precipice of

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Speaker 2: like going global and like a lot of these sounds

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Speaker 2: and artists are also starting to find international attention at

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Speaker 2: the same time. So yeah, it's just a very a

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Speaker 2: very exciting thing to watch unfold, especially like you know,

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Speaker 2: given that it is so new for the country.

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Speaker 1: Well, last, but's certainly not least is China, which when

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Speaker 1: you talk about that region in the media business, it's

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Speaker 1: almost like talking about a separate planet because of both

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Speaker 1: its size and to some degree not necessarily a geographic distance,

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Speaker 1: but it's a market that tends to be an arm's

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Speaker 1: length away from the rest of the world. How does

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Speaker 1: it work in the music business? Now, what's distinctive about

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Speaker 1: the Chinese music market?

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Speaker 2: You're right where China is sort of out of all

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Speaker 2: of the markets, sort of very much on its own

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Speaker 2: playing field, where you know, more so than Japan and India,

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Speaker 2: it has the population size to sort of be self sustaining.

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Speaker 2: But what's really what really sets them apart is basically,

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Speaker 2: like what we've seen from like our own data, is

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Speaker 2: that Chinese music consumers are a lot more i would say,

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Speaker 2: technologically inclined than like the average music fan and other

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Speaker 2: markets where they're a lot basically like they're a lot

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Speaker 2: more down to purchase a digital copy of an album

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Speaker 2: or by virtual merchandise or you know, virtually tip artists

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Speaker 2: then we'll see in like the US or other markets,

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Speaker 2: And as a result of that, that's basically allowed like

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Speaker 2: the streaming market to grow in sort of its own

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Speaker 2: way that we haven't seen even in sort of like

404
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Speaker 2: established streaming markets like the US, where like, on top

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Speaker 2: of streaming being adopted at such a fast rate, the

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00:26:06,160 --> 00:26:09,120
Speaker 2: Chinese stream market is already sort of like shifting its

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Speaker 2: priorities from just you know, pure user growth to now

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Speaker 2: user monetization. So it's sort of become like like companies

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Speaker 2: like Tencent have basically become the model for like the

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Speaker 2: super vip idea, you know, where for an extra you know,

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Speaker 2: four or five bucks a month, you on top of

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00:26:34,800 --> 00:26:37,960
Speaker 2: like the regular perks of a streaming subscription, you now

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Speaker 2: get access to like high quality audio or exclusive access

414
00:26:42,240 --> 00:26:46,800
Speaker 2: to concert tickets or virtual merchandise or you know, just

415
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Speaker 2: some sort of like additional benefits on top of like

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Speaker 2: the regular streaming subscription, and that has proven incredibly successful.

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Speaker 2: Ten Cent alone has fifteen millions super vip users as

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Speaker 2: of late twenties twenty five. You know, uh net East

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Speaker 2: Cloud Music, which is sort of like their main competitor,

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Speaker 2: has also seen a lot of success, and on top

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00:27:11,640 --> 00:27:14,280
Speaker 2: of that, they've both had very little churn on you know,

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00:27:14,840 --> 00:27:20,520
Speaker 2: so like that has sort of proven appealing to companies

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Speaker 2: like Spotify and you know, the big three labels who

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Speaker 2: you know. For the past year, superfan has been the

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00:27:28,440 --> 00:27:31,520
Speaker 2: the hot word of the of the industry, you know,

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Speaker 2: where like now, a lot of these companies want to

427
00:27:34,200 --> 00:27:39,800
Speaker 2: try and you know, take a similar approach to Tencent

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Speaker 2: and net eas cloud music and find a way to

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Speaker 2: create more channels of monetization through like its most passionate fans.

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Speaker 2: But I think what a lot of these companies have

431
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Speaker 2: to remember is that the fact that Chinese music consumers

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Speaker 2: are so tent you know, virtually minded versus like other markets.

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Speaker 2: That's sort of what I think what gave ten Cent

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Speaker 2: and net ease sort of a leg up and sort

435
00:28:06,040 --> 00:28:08,720
Speaker 2: of getting this super vip thing to stick, you know.

436
00:28:08,840 --> 00:28:11,800
Speaker 2: Like one of the most interesting metrics I found was

437
00:28:11,840 --> 00:28:16,160
Speaker 2: I looked at differences between Chinese superfans and US super fans,

438
00:28:16,800 --> 00:28:21,560
Speaker 2: and seventy eight percent of China super fans said they

439
00:28:21,560 --> 00:28:23,840
Speaker 2: would purchase a digital copy of a song or album,

440
00:28:23,880 --> 00:28:27,720
Speaker 2: whereas only sixty one percent of US superfans said the

441
00:28:27,760 --> 00:28:32,639
Speaker 2: same thing. So like basically, the short of it is

442
00:28:32,640 --> 00:28:36,560
Speaker 2: that all the US super fans like outpaced Chinese super

443
00:28:36,560 --> 00:28:40,800
Speaker 2: fans for like physical media, for you know, going to

444
00:28:41,080 --> 00:28:44,880
Speaker 2: live performances, but then China, Chinese superfans were ahead of

445
00:28:44,880 --> 00:28:47,400
Speaker 2: them for all the like virtual stuff like joining a

446
00:28:47,480 --> 00:28:52,240
Speaker 2: virtual fan club, virtually tipping, buying digital merchandise. So I

447
00:28:52,280 --> 00:28:57,000
Speaker 2: think ultimately that's what gave the super VIP model so

448
00:28:57,160 --> 00:28:59,560
Speaker 2: much momentum in China, and that's something that I think

449
00:28:59,600 --> 00:29:01,520
Speaker 2: a lot of the Western companies will have to keep

450
00:29:01,520 --> 00:29:04,160
Speaker 2: in mind. You know, Spotify is just starting to test

451
00:29:04,160 --> 00:29:07,560
Speaker 2: out at super fan tier and I am skeptical if

452
00:29:07,600 --> 00:29:09,240
Speaker 2: it is. If they are going to do a one

453
00:29:09,320 --> 00:29:13,000
Speaker 2: for one copy of what Tencent did, I'll be interested

454
00:29:13,000 --> 00:29:14,400
Speaker 2: to see how much it actually sticks.

455
00:29:14,600 --> 00:29:18,680
Speaker 1: Well, we have hopscotched around the globe from one Asian

456
00:29:18,720 --> 00:29:21,480
Speaker 1: market to the next, So let's zoom out for the

457
00:29:21,520 --> 00:29:25,880
Speaker 1: bigger picture view in terms of the future of this

458
00:29:26,520 --> 00:29:29,400
Speaker 1: not just Asian music market, but how does it relate

459
00:29:29,480 --> 00:29:33,640
Speaker 1: to the global market beyond Asia. Is it the driver

460
00:29:33,960 --> 00:29:37,560
Speaker 1: of that market, is it the model for what the

461
00:29:37,600 --> 00:29:39,880
Speaker 1: rest of the market could be, or does the rest

462
00:29:39,880 --> 00:29:42,400
Speaker 1: of the world still have some tricks up its sleeve

463
00:29:42,440 --> 00:29:43,680
Speaker 1: that it could teach Asia.

464
00:29:43,720 --> 00:29:48,600
Speaker 2: I think ultimately Asia is going to play a pretty

465
00:29:50,000 --> 00:29:53,360
Speaker 2: pretty significant role I think in the global industry going forward.

466
00:29:54,120 --> 00:29:57,719
Speaker 2: I mean we've already seen what kpop can do, so

467
00:29:57,960 --> 00:30:01,840
Speaker 2: I think like imagine that also coming from like the

468
00:30:01,960 --> 00:30:06,040
Speaker 2: J pop industry or you know, the if Indian hip

469
00:30:06,080 --> 00:30:10,560
Speaker 2: hop becomes the next global genre to get an international audience.

470
00:30:11,520 --> 00:30:15,400
Speaker 2: And like also we're starting to already see the influence

471
00:30:15,600 --> 00:30:18,640
Speaker 2: like I was just talking about with Western companies wanting

472
00:30:18,680 --> 00:30:21,720
Speaker 2: to utilize super fandom and looking to companies like Tencent

473
00:30:22,320 --> 00:30:25,800
Speaker 2: as a model for that. I think that's only going

474
00:30:25,840 --> 00:30:31,520
Speaker 2: to continue as the streaming industry continues to you know,

475
00:30:31,840 --> 00:30:36,600
Speaker 2: gain footholds in emerging markets. And but you know, also

476
00:30:36,720 --> 00:30:38,800
Speaker 2: to be clear, like I don't think this is gonna

477
00:30:38,800 --> 00:30:44,479
Speaker 2: be a phenomenon coming just from Asia, like just in general.

478
00:30:44,680 --> 00:30:47,080
Speaker 2: Sort of like one of the main one of the

479
00:30:47,120 --> 00:30:49,560
Speaker 2: main outcomes we're seeing in the streaming era is sort

480
00:30:49,560 --> 00:30:58,080
Speaker 2: of this more like interconnected interconnectedness you know, amongst like

481
00:30:58,920 --> 00:31:03,080
Speaker 2: just across the the global industry. You know, obviously, like

482
00:31:03,120 --> 00:31:05,440
Speaker 2: probably like Latin music is sort of the biggest example

483
00:31:05,480 --> 00:31:08,600
Speaker 2: of that, where like now it's become this powerhouse because

484
00:31:08,600 --> 00:31:12,720
Speaker 2: of this you know, international recognition they've they've been able

485
00:31:12,760 --> 00:31:16,840
Speaker 2: to achieve. We see it with K pop and also,

486
00:31:16,960 --> 00:31:20,240
Speaker 2: like you know, even country music from the US is

487
00:31:20,280 --> 00:31:24,080
Speaker 2: like taking off in places like the UK. So like

488
00:31:24,160 --> 00:31:26,320
Speaker 2: I do think in general, like we're going to start

489
00:31:26,360 --> 00:31:29,680
Speaker 2: seeing more of that. We're gonna start seeing the you know,

490
00:31:29,920 --> 00:31:34,320
Speaker 2: could the continued prominence or rise of non English speaking artists.

491
00:31:34,920 --> 00:31:38,240
Speaker 2: And I think Asia its key advantage is that, like

492
00:31:38,320 --> 00:31:42,520
Speaker 2: it has a lot of different countries that are completely

493
00:31:42,640 --> 00:31:46,040
Speaker 2: viable to sort of like become the home of the

494
00:31:46,120 --> 00:31:49,080
Speaker 2: next international artists like that, you know. So I think

495
00:31:49,080 --> 00:31:52,440
Speaker 2: that's ultimately going to be where Asia plays its biggest

496
00:31:52,720 --> 00:31:53,240
Speaker 2: role here.

497
00:31:54,160 --> 00:31:57,760
Speaker 1: Well, time will tell on that front. But I thank

498
00:31:57,800 --> 00:32:01,640
Speaker 1: you for delivering a really strong report on an interesting

499
00:32:01,760 --> 00:32:05,000
Speaker 1: market to say the least. Thank you Robert Steiner for

500
00:32:05,080 --> 00:32:05,840
Speaker 1: joining us today.

501
00:32:06,800 --> 00:32:09,040
Speaker 2: Thank you, thanks for having me, Thanks for listening.

502
00:32:09,280 --> 00:32:11,560
Speaker 3: Be sure to leave us a review at the podcast

503
00:32:11,600 --> 00:32:14,440
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00:32:14,520 --> 00:32:16,840
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00:32:16,920 --> 00:32:21,040
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00:32:21,080 --> 00:32:24,880
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