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Chapter 543 0531 [Music Can Go to the Cloud!]

The acquisition of Giant Whale was very simple and efficient, as Chen Guiliang only paid $80 in cash and assumed Giant Whale's debts.

The $80 cash acquisition payment was divided among the five major shareholders, including Chen Ge, Yao Ming, and Google, according to their shareholding ratios.

Chen Guiliang called Chen Ge and Wang Hao to a meeting.

Chen Ge presented his proposed copyright purchase plan and said very tactfully, "President Chen previously held exclusive rights to online music copyrights, and those contracts were rather extravagant. President Chen must have his reasons for quickly signing contracts with some mainstream record companies to avoid any unforeseen complications..."

To put it simply: Chen Guiliang was taken advantage of when he bought music copyrights and signed those contracts.

Chen Guiliang laughed and said, "Speak frankly, don't hold back."

“Then I’ll really tell you.” Chen Ge carefully observed Chen Guiliang’s expression.

Chen Guiliang said, "Speak."

Chen Ge said:

"First, it's a buyer's market now, and we're in a completely advantageous position. If we delay the negotiations by a month or two, the record companies will back down. The previous negotiations were too rushed. Of course, rushing has its advantages; it allows us to cut through the mess quickly."

"Second, contracts should not be one-size-fits-all; they can be broken down into smaller parts. This is especially true for large record companies, which have a vast music library and can customize contracts for different songs individually."

"Third, the contract term can be extended. Don't use the '3+2' model. I can trick some record companies into signing ten-year contracts! The record industry is in a slump right now, especially for small and medium-sized companies. They don't even know if they can survive for five years. I can totally get them to sign 15-year contracts."

Chen Guiliang clapped his hands and said, "He truly is a professional."

Chen Ge said, "I just sign a lot of legitimate contracts every year, so I have a lot of contact with record companies and understand their thinking. Next, I plan to extend the negotiation period with the three major international record companies and domestic giants like Huayi Brothers to about a year. We'll customize detailed contract terms for each company, each song, and each artist..."

Chen Ge went on and on for several minutes, basically saying that for singers and songs that are not very famous or have already faded from popularity, they would sign ten-year contracts to lock them in. For popular songs and singers, they would tailor contracts to sign them for five years or more.

Moreover, you must negotiate a lower price!

Chen Ge concluded, "These past few days, I've thoroughly studied the music libraries of the three major international record labels. If we only sign their Chinese music libraries and slightly increase the revenue share, the total guaranteed amount from the three companies each year won't be more than 100 million. We can get it for around 70 million! Add some popular foreign language songs, and it'll be at most 80 million or 90 million."

This is assuming no one else tries to snatch the copyright. If Tencent were to suddenly appear and compete for it, the price wouldn't be around 70 or 80 million. It could very well be driven up to over 300 million!

Chen Guiliang said, "You are all professionals, so let me share my thoughts as a layman. I plan to put online music on the cloud."

"Up to the cloud?"

"impossible!"

Chen Ge and Wang Hao exclaimed in surprise at the same time.

The cloud music platform was launched in 2012, but it had a fatal problem: the data traffic fees were too expensive, and users simply couldn't afford them.

Chen Guiliang said, "There are two solutions to the data usage problem. First, we can partner with telecom operators to launch exclusive data packages; second, ByteDance Cloud Music can develop 'smart offline' and 'one-click caching' functions. Users can cache their music in a Wi-Fi environment, and listening to music offline will no longer consume data."

Chen Ge and Wang Hao exchanged a glance.

They were all top talents in the music platform industry, and they instantly thought of countless benefits. At this moment, their eyes were already shining.

This is a groundbreaking innovation in China's online music industry!

Chen Guiliang stood up and began to describe: "If I were a user of ByteDance's music platform, I could pre-cache some playlists using Wi-Fi. If I wanted to go for a morning run, I would open a playlist related to morning runs. If I was heartbroken, I would listen to a playlist about heartbreak. I wouldn't even need to spend time choosing songs myself, because the system would send me playlists that matched my current mood. How about calling this feature 'Scene Radio' or 'Mood Radio'? Wang Hao, your team is an expert in customizing playlists. What do you think?"

Wang Hao laughed and said, "That's awesome."

Chen Guiliang continued, "The audiovisual effects can also be improved. Songs in a playlist or album can be seamlessly transitioned between two songs on the cloud music platform. Professional cross-fading effects can even be added."

Wang Hao said, "This will drive music enthusiasts crazy with joy."

Chen Guiliang said, "The soul of the cloud music platform is social interaction. Commenting, liking, sharing songs and updates are like a music version of WeChat Moments. You can also create stories for playlists and share your own stories. This can greatly improve user stickiness and activity."

Chen Ge drew parallels between Weibo and WeChat, and then applied these two products to a music platform, and couldn't help but exclaim sincerely, "Mr. Chen, you are truly a genius at creating online social media!"

Chen Guiliang continued, "There are also features like music fingerprinting and song recognition. If you encounter a song that you like but are not familiar with, you can open the app, let it play for a while, and it will identify the song and artist and add it to your favorites with one click. Some software abroad already has this function, but it has not yet been deeply integrated into music platforms."

Following that, Chen Guiliang went on to talk about a series of ideas, including a music timeline, an annual listening report, a personalized homepage, algorithm recommendations, intelligent sound quality switching, and cloud synchronization across all platforms.

Chen Ge and Wang Hao were both stunned, because these features were mostly things that traditional music platforms couldn't offer.

Chen Guiliang said, "You two should discuss how to set a reasonable fee."

Chen Guiliang acquired Giant Whale Music because of its user resources. Giant Whale Music had been operating a legitimate music service for six years, boasting over ten million registered users, millions of active users, and hundreds of thousands of long-term paying users. Xiami Music has also cultivated a large group of paying users.

By merging the two platforms into Byte Music and bringing their respective paid users to the Byte Cloud Music platform, a healthy paid music ecosystem can be initially established.

It will definitely still be a membership system, with paid members enjoying a better user experience.

However, we cannot completely eliminate free users; we must allow users to enjoy standard-quality songs for free.

Chen Guiliang said, "I don't care how you balance paid and free services, I only have one basic requirement: no audio ads are allowed in the songs!"

Chen Ge and Wang Hao both laughed.

At that time, many music platforms chose to insert advertisements into songs. Game advertisements were the most common, as they were a significant source of revenue for music platforms.

……

There was no need to hold a press conference; the industry already knew about the merger of Xiami Music and Kugou Music into ByteDance Music.

Both major music platforms issued announcements to their respective users: "Dear Xiami (Junky) users: This platform is now under ByteDance Music, and your account content and recharge data will remain unchanged..."

The gist of the message is that users should wait until the ByteDance Cloud Music app is launched, at which point they can download and log in to the app using their original accounts.

Especially for users of GiantWhale, their biggest worry upon hearing that GiantWhale had terminated its cooperation with Google was that their previous top-ups would be invalidated. Now that ByteDance is providing assurance and promising that their original top-ups will remain valid, they can finally rest assured.

Subsequently, Byte Music issued an announcement on its official Weibo account: "Our company is committed to promoting the full legalization of online music. We have already signed exclusive online agency agreements with nearly ten record companies in mainland China, Taiwan, Hong Kong, and South Korea. We welcome more record companies and independent musicians to come and discuss copyright cooperation..."

"Our company has signed exclusive online distribution agreements in mainland China for songs by domestic and international singers and groups, including Jay Chou and Girls' Generation. Other companies that represent these singers without exclusive rights are requested to remove their works upon contract expiration. Our company reserves the right to pursue legal action!"

The announcement immediately went viral.

In particular, the singers' die-hard fans were arguing fiercely on QQ groups, Baidu Tieba, Weibo, and other platforms.

Some people cheered that their idols' copyrights were being valued, and that their idols would be able to earn more money. Some even spontaneously registered accounts on platforms like Xiami and Kuaishou to show their support.

Some people criticized ByteDance for monopolizing the music streaming platform and forcing them to switch to another platform.

Discussions about online music copyrights have become a hot topic online—it has been discussed several times before, but each time it has come to nothing.

Reporters even went to interview Cui Jian.

Cui Jian said, "I strongly support the standardization of online music copyright. Chen Guiliang is a very capable person; he dares to do things that other bosses wouldn't. I know Chen Ge of Giant Whale Music; he was one of the shareholders of my former record company. Chen Ge recently asked me to act as an intermediary to buy the online copyright of Jingwen Records. If the deal goes through, my online copyright will also be transferred to ByteDance Music. This is great; it's beneficial to the development of the music industry."

The first episode of "The Voice of China" has just premiered and is already a huge hit.

When Liu Huan, a mentor on the show, was cornered by reporters, he said, "I haven't signed with a record company recently, but the copyrights to some of my previous songs are held by Jingwen Records. I would strongly support a collaboration between Jingwen Records and ByteDance Music. It would be best if they could produce legitimate music. I urge all domestic online music platforms to produce legitimate music to support the development of Chinese music."

Na Ying also said, "The copyrights to some of my early songs have been bought by Byte Music. My former employer, Linfair Records, signed a contract with Byte. I fully support Mr. Chen... Will I be able to get a share of the profits? It seems so, but I'll have to ask my former employer for details."

Chen Guiliang's Weibo comments were filled with supportive voices, but some also joked that Chen Guiliang was bound to lose money this time.

Chen Guiliang couldn't help but post a Weibo message: "Everyone, take note, this old master is brewing a big surprise! You'll understand when the ByteDance Music APP is launched."

"Old Master Chen, be careful, lest you hold it in for so long and then fart out."

"Old Master Chen is going to play with abstract art again."

"What big move could they possibly be planning? It's nothing more than merging the Xiami and Jujing apps. I used to be a user of Yiting Music, but after Jujing acquired Yiting, to be honest, the app is terrible. So terrible that I stopped subscribing to it."

"Old Chen's foresight is truly remarkable; he actually predicted that 'The Voice of China' would become a huge hit. Now, the video rights to 'The Voice of China' have been acquired by AcFun, which has then subscribed to Tudou. Xiami Music has also acquired the audio rights. If you want to watch or listen to 'The Voice of China' online, you have to use a platform within the ByteDance ecosystem. I estimate that ByteDance has made a fortune."

"iPartment 3 is about to air, and it seems the online rights are still with Tudou.com. In addition, with the distribution rights for 'Empresses in the Palace' and 'The Voice of China,' Tudou.com's traffic has exploded this year, and I estimate it will surpass Youku sooner or later."

"It has already surpassed Youku, okay? Tudou is the boss now."

"..."

Tencent, Sina, Baidu, Kugou, Kuwo, Duomi, Migu... a whole host of music platforms were baffled by Chen Guiliang's actions.

What is this guy trying to do?
Record companies and independent musicians, on the other hand, were overjoyed and took the initiative to negotiate copyrights with ByteDance Music.

The person in charge of negotiations they're facing now is Chen Ge. The more proactive they are, the more aggressively they'll be pressured to lower the price, and the longer the contract term will be—even as long as ten years!

(End of this chapter)