投稿類別：英文寫作類

篇名： The Power of the Subscription Economy: Exploring - in

莊家瑋。國立師大附中。1475班

指導老師： 黃宗嫻 老師

The Power of the Subscription Economy: Exploring Music Streaming Media in Taiwan

I. Introduction I. 1. Background

There’s no denying that the subscription economy has been the New Black, especially in the 21st century. The subscription economy in Europe, the Americas, and Asia grows more than 300% in the last seven years (Zuora, 2019). With the development of the Internet and technology, myriads of online services are accessible to the public and even partially in place of brick-and-mortar business. People nowadays attach little importance to the ownership of products, while they put more emphasis on practical values and services of products. Their expectation of products and services simultaneously varies. Customization is now required to offer variant services. Products and services are expected to be constantly upgraded and renewed in preference to being replaced until they’re broken.

At the initial stage of subscription, each customer used to play a money-giver and companies served as product-sellers, which can merely be recognized as a business transaction. But now, companies which achieve remarkable success in subscription nowadays actually put themselves in customers’ shoes. So, they take more consideration to customers, and provide customizable products and personalized services that can better tally with customers’ demand. The relationships among each customer and businesspersons are getting closer and more valuable. It is owing to merchants’ amicable consideration for customers that the subscription economy comes into vogue. With the view to maintaining and ameliorating the interdependent relation, enterprises offering services endeavor to get acquainted with customers by gathering feedback and data from customers and to figure out the solutions to meeting customers’ needs. The subscription economy, based on an efficient economical circulation, is going to be the biggest catalyst for global economic growth.

I. 2. Motivation

Music listening has come a long way over the past few decades. Gone are the days when the audience had to buy CDs, vinyl records, or cassette tapes. Ever since the advent of the Internet and the proliferation of , subscription to music is all the rage, and thus streaming platforms are now raking in the big bucks. They dominate more than 80 percent of the music industry's revenue. A novel type of music listening keeps blowing up the music industry, becoming a pop culture phenomenon. People with headphones can simply sign up to a music-streaming platform and then get access to diverse types of music on the go. In Taiwan, four main music-streaming platforms capture 90% market share, including , , KKBOX, MUSIC.

I. 3. Research questions

After generally understanding the background information of music-streaming media, the researcher discovered some notable issues and would like to penetrate factors affecting customers’ behavior. So, the researcher designed six questions below based on the aforementioned observations.

1 The Power of the Subscription Economy: Exploring Music Streaming Media in Taiwan

1. Which music-streaming platform do male and female users prefer most? 2. Which channel do male and female users get music-streaming information from? 3. How often do male and female users use music-streaming platforms per week? 4. How much is the monthly subscription that is acceptable for male and female users? 5. Which common feature of music-streaming platforms do male and female users like? 6. Why do male and female users subscribe to music-streaming media?

I. 4. Method

For the purpose of analyzing the background knowledge of the subscription economy of music-streaming media, the researcher collected a great deal of related information and literature from the Internet, public libraries, and reference libraries. The researcher made a synthetic literature review after comparing the information from various reliable resources, such as scholarly papers, official data, and authoritative journals.

Preliminarily understanding the growing trend and the current issues, the researcher designed a questionnaire and then distributed copies to the participants so as to probe into the preference, the frequency, and their opinions on music-streaming media.

II. Body: Discussion and Results II. 1. Background Information II. 1. 1. Music-streaming industry in Taiwan

PwC Taiwan (2019) delivered the newest annual report in anticipation of the entertainment and media industry in Taiwan from 2019 to 2023. This accountancy firm assessed the music industry’s revenue in the past five years, namely from 2014 to 2018. Based on the data of these years, PwC Taiwan statistically predicted the trend of development in the future five years.

Note. F= Future anticipation Source. Adapted from “the annual report in anticipation of the entertainment and media industry in Taiwan from 2019 to 2023”, PwC Taiwan, 2019. Figure1: The music industry’s revenue from 2014 to 2023

2 The Power of the Subscription Economy: Exploring Music Streaming Media in Taiwan

There’s a dramatic increase in streaming media, with 24.5% growth from 2013 to 2018. It is reasonable to expect that streaming media can probably generate more than 55 percent of the music industry’s revenue. As streaming media predominate in the music industry, the revenue from physical albums quickly declines. The increase in the revenue from streaming media is highly associated with the decrease in the revenue from physical albums. It is predicted that albums will be much less dominant, with 4.5 percent of its revenue in 2023 anticipated. Live music, such as concerts and music awards ceremony, consistently takes 35 percent of the revenue on average. It is a marginal impact that the improvement of streaming media has on live music. By the way, a long-term decrease in revenues from digital music and other resources is pretty viable.

As a matter of fact, there’s enormous potential for growth in this market. One market survey indicates that 34% of users in Taiwan use digital music content. However, only 6% of those users have an online music-streaming subscription (Ashley King, 2019). No wonder four main music-streaming platforms are quite zealous in Taiwan’s music industry.

II. 1. 1. 1. Spotify

Launched in 2008, Spotify is the most well-known music-streaming app, launching the trend for subscription music services with its wide free offering and multiple premium options. It takes an efficacious business model called freemium as its market strategy. Basic services are free, while premium features are offered via paid subscription. Spotify generates revenues by selling premium streaming subscriptions to users and advertising placements to third parties in order that it can service free-users and paying users.

As of July 2019, Spotify had 232 million monthly active users, including 108 million paying subscribers. In spite of the largest scale it is, Spotify still continuously updates its services and user interfaces. Three main features that make Spotify the global dominance of music-streaming media are as follows.

(1) Permanent access to music free of charge: Users are allowed to access more than 35 million songs without payment. Only a few advertisements will be broadcast to generate revenues from third-party advertisers. (2) Intimate connection with social media: Spotify cooperates with Facebook and famous social applications to have users’ favorite songs and singers shown on specific interfaces. Users can share their song lists with their and families. (3) Personalized playlists: Algorithms are utilized to govern subscribers’ listening experiences. Numerous music styles and recommended playlists are ready to hand for users.

II. 1. 1. 2. Apple music

Launched on June 30, 2015, Apple music is a global music-streaming service applied in over 100 countries worldwide. In February 2016, Apple music made a debut in Taiwan. Neat interfaces

3 The Power of the Subscription Economy: Exploring Music Streaming Media in Taiwan of Apple music allow subscribers to get online or offline access to 45 million songs easily.

Thanks to high compatibility between Apple music and iOS, Apple music has drawn most of the iOS users’ attention, quickly having a significant increase in the market share of music-streaming media. Features below are the significant reasons why Apple music can expand in Taiwan.

(1) Upon paying for subscribing to Apple music, it’s valid for subscribers to use its services on Apple’s products, such as iPad, , and Mac. (2) Linking up with Siri, a virtual assistant application with artificial intelligence, unknown songs can be recognized by their melody and voices. What’s more, Siri can automatically play preferable songs for users.

II. 1. 1. 3. KKBOX

Developed in 2005, KKBOX is a Taiwan-based music-streaming media. With 15 years of experience in the Asian music industry, KKBOX has the largest customer base in Taiwan. KKBOX features over 45 million legal tracks. As a result of its local background, KKBOX’s library is equipped with abundant Asian songs. KKBOX is also committed to creating immersive online music experiences to users and to enriching music services. Three conspicuous functions burnish its leading status in Taiwan.

(1) Subscribers of KKBOX can get access to exclusive video, artist interviews, live concert reports, entertainment news. These features make users get close to celebrities and have a strong advantage over other platforms. (2) It is worth mentioning that a unique service “Listen with” is given to let paying users listen to the same tracks as friends or favorite artists. (3) At the beginning of each year, KKBOX Music Awards takes place to promote outstanding artists’ compositions, which always marvelously catches tens of thousands of music stans’ eyes.

II. 1. 1. 4.

LINE is a popular freeware app for instant communications. These years, LINE has branched out into several additional services, such as LINE Pay, LINE TV, and Line Shopping. Line Music is one of its development foci. LINE unveiled its music-streaming service Line Music in Taiwan. Intimately related to LINE, Line Music uses a marketing blitz to carve up the market share. Three special services are as the following.

(1) AI DJ: Artificial intelligence is used to pick some impressive flips of songs together to composite music suites for users. Songs won’t be completely shown, but remarkable flips will be played for users. This service enhances the quality of music-streaming media and comes innovative. (2) Personalized answer tones and phone rings of favorite songs: Users can pick their favorite songs 4 The Power of the Subscription Economy: Exploring Music Streaming Media in Taiwan

to be their own answer tones or phone rings. (3) Celebrity endorsement: Coco Lee, a globally-famous diva, is served as the annual brand spokesman. Besides, Line Music is stacked with superstars’ support, including support from MayDay, Della, Bii, and Tanya Chua.

II. 1. 1. 5. Comparison among four main music-streaming platforms in Taiwan

Established in 2005, KKBOX is the foremost music-streaming service in Taiwan, with support from 320 thousand users in Taiwan. Spotify added Taiwan to its roster of Asian countries in 2013 and has been up against the domestic music-streaming app KKBOX. In February 2016, Apple music launched in Taiwan. Three music-streaming giants geared up for war. Much to people’s astonishment, came to provide LINE MUSIC service in Taiwan on 10 July 2019 out of the blue. Each giant innovates its services in an attempt to expand the business territory and attack the music-streaming market. There’s no doubt that the streaming wars will go fiercer and fiercer.

To ponder on each factor affecting customers’ behavior, the researcher compared four music-streaming giants in Taiwan by collecting the newest information relevant to four platforms, and scrutinized the reliability of resources and the correctness of the information by consulting four platforms and reliable statistical data. Thus, the following contents are thoroughly marshaled.

Table 1 Comparison among four main music-streaming platforms in Taiwan Brand Spotify Apple music KKBOX Line Music

Logo

Subscribers (millions) 108 60 10 11 Trial 30 days 3 months 3 days 1 month

Monthly Personal 149 150 149 149/180 Subscription Family 240/6p 240/6p X X (NT$ per month) Student 75 70 100 X

Quality (kbps) 320 256 192 320 Total 50 50 45 30 Legal tracks Asian songs KKBOX > Spotify > Apple music > Line Music (millions) Western songs Spotify > Apple music > KKBOX > Line Music Note. 6p = Six people who can use services simultaneously

5 The Power of the Subscription Economy: Exploring Music Streaming Media in Taiwan

As for the number of subscribers, there are 108 million subscribers of Spotify. Apple music is subordinated to Spotify, with 60 paying users. KKBOX and Line Music have 10 million users approximately. With regard to trials, Spotify and Line Music respectively give each user 30 days and 1 month to experience premium services free of charge, while 3 months’ trials are offered by Apple music. Only with 3 days’ trial does KKBOX provides. On average, the price of the monthly subscription cost 150 NT dollars. Two companies offer special subscriptions for 6 people per family. To attract more students, three platforms offer economical subscriptions for students only. Apart from the price, the number of legal tracks is also one of the key factors. KKBOX possesses the biggest library of Asian songs. That is why KKBOX can be the dominance of streaming media in Taiwan. As for western songs, Spotify and Apple music have the richest library.

II. 2. Questionnaire

Four platforms have different advantages. Factors affecting customers’ behavior are intricate. The researcher would like to deliberate on how the difference among four platforms influences customers’ preference. Several key factors that possibly affect customers’ behaviors are discussed below by collecting the data of the questionnaires.

II. 2. 1. Instrument

For the purpose of exploring research questions, the researcher employed Google Forms to design a questionnaire and conduct a survey on the Internet. Based on the information the researcher collected, a few forms and charts were used to analyze the data, to indicate the trend of music-streaming media, and to figure out viable explanations of research questions

II. 2. 2. Participants

517 questionnaires were distributed to the participants and all of them are valid. The subjects of the study are from the Affiliated Senior High School of National Taiwan Normal University. All the participants are senior high school students, with their ages ranging between fifteen and eighteen. As for gender, there are 303 males and 214 females.

II. 2. 3. Data analysis II. 2. 3. 1. Which music-streaming platform do male and female users prefer most?

Figure 2&3: The preference for music-streaming platforms

6 The Power of the Subscription Economy: Exploring Music Streaming Media in Taiwan

Figure 2 and 3 above are designed to indicate users’ preference for music-streaming platforms. Most male and female users tend to use KKBOX. Spotify takes second place. Line Music, Apple music, and others occupy less proportion than KKBOX and Spotify. The researcher infers that KKBOX’s well development of “interaction with celebrities” and “connection with social media” makes more female users prefer KKBOX.

II. 2. 3. 2. Which channel do male and female users get music-streaming information from?

Figure 4&5: The channel of music-streaming information

Figure 4 and 5 are two charts that illustrate the channel where people get music-streaming information. Most users access the related information on the Internet. It is apparent that the Internet takes a vital role in the propagation of music-streaming media. Recommendation from friends or families certainly affects people’s access to music-streaming media, with 23% of male users and 27% of female users. “News” and “Newspapers and magazines” take less proportion of the channel where people gain information.

II. 2. 3. 3. How often do male and female users use music-streaming platforms per week?

Figure 6&7: The frequency of using music-streaming platforms

By and large, it takes male and female users from 4 to 7 hours to enjoy music-streaming platforms. On average, female users have a tendency to spend more time (6-7 hours weekly) on music-streaming than male users do (4-5 hours weekly). It can be inferred that female users have more demand for music.

7 The Power of the Subscription Economy: Exploring Music Streaming Media in Taiwan

II. 2. 3. 4. How much is the monthly subscription that is acceptable for male and female users?

Figure 8&9: The allowance of subscriptions

Figure 8 and 9 respectively delineate how much male and female users would like to pay for subscriptions. Generally, most users are willing to pay less than NT$150 for subscriptions. Approximate 70% of male users and 80% of female users would like to pay NT$50-150. Most subscription plans cost NT$70-150, which are most users satisfied with. So, current subscriptions of four platforms meet people’s expectations and are acceptable.

II. 2. 3. 5. Which common feature of music-streaming platforms do male and female users like?

Figure 10: The preference for mutual features

The preference for common features is clearly manifested in Figure 10. Male users highly rely on recommendation from platforms, such as recommended playlists and leaderboards. It is possible that they have few ideas which song to listen to. Most female users enjoy current music events, connection with social media, and interaction with celebrities. They pay more attention to music than male users do. Especially, 81.3% of female users would like to interact with celebrities and friends online.

8 The Power of the Subscription Economy: Exploring Music Streaming Media in Taiwan

II. 2. 3. 6. Why do male and female users subscribe to music-streaming media?

Figure 11: The reasons for using music-streaming media

Figure 11 represents the reasons for using music-streaming media in preference to free services. Around 80% of male and female users respect the originality of artists’ works and value the legality. Significantly, female users also take account of benefits that music-streaming platforms give, instant information about stars and music, and premium services that allow users to have better experiences. It is evident that items in Figure 11 are tallying with some parts in Figure 10 a lot.

III. Conclusion

The future trend of music-streaming media in Taiwan is predicted in Figure 1. Figure from 2 to 10 show senior high school students’ attitudes towards music-streaming. Based on the results and the analysis above, the researcher draws some reasonable conclusions. These viewpoints are depicted as follows.

1. The growth of music-streaming media contributes to the recession of physical albums. 2. KKBOX is the most popular music-streaming media, with the highest proportions of users’ preference. 3. The Internet is the most influential channel that people get music-streaming information. 4. Male and female users usually spend from 4 to 7 hours enjoying music-streaming services. 5. Most of the participants would like to pay NT$50-150 to get access to music-streaming services. 6. Male users have fewer subjective ideas about music, since they highly rely on recommendation, such as recommended playlists and leaderboards. 7. Female users pay more attention to music information than male users do. 8. Most people choose premium services, for they respect the originality of artists’ works and value the legality. 9. Female users have comprehensive considerations while choosing paying services.

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IV. References 1. 吳沚芸（2018）。影響線上串流音樂服務購買意圖之因素。國立中正大學資訊管理系研究 所碩士論文，嘉義縣。 2. 吳俊葵（2019）。在串流時代聆聽：日常生活中的流行音樂消費實作。國立政治大學傳播 學院傳播碩士學位學程碩士論文，台北市。 3. 吳震威（2016）。線上串流音樂平台使用者對平台之購買意願－以 KKBOOX 與 Spotify 為例。國立臺灣大學新聞研究所碩士論文，台北市。 4. 李映蓉（2018）。線上音樂串流平台之競爭策略分析 – 以 Spotify 為例。國立臺灣大學 國際企業學研究所碩士論文，台北市。 5. 陳冠廷（2018）。串流音樂平台付費使用意願之研究—從消費價值與使用滿意觀點分析。 中原大學企業管理研究所碩士論文，桃園縣。 6. 黃意文（2017）。音樂串流廠商經營發展策略之研究-以 Spotify Technology S.A.為例。國 立臺灣大學企業管理碩士專班碩士論文，台北市。 7. 黃群雅（2016）。串流音樂平台滿意度及購買意願之研究-以行銷策略認知為干擾變項。 東吳大學企業管理學系碩士論文，台北市。 8. 劉幸茹（2016）。影響串流音樂購買意願之重要因素-以台灣為例。國立臺北大學企業管 理學系碩士論文，新北市。 9. Ashley King. (2019, July 12). Re: LINE Music Officially Launches In Taiwan Where Only 6% Of Smartphone Users Stream. Digital Music News. Retrieved from https://www.digitalmusicnews.com/2019/07/12/line-music-now-available-in-taiwan/ 10. Hagen, A. N. (2015). The playlist experience: Personal playlists in music-streaming services. Popular Music and Society, 38(5), 625-645. 11. Helkkula, A. (2016). Consumers' intentions to subscribe to music-streaming services. 12. Lee, D., Yejean Park, J., Kim, J., Kim, J., & Moon, J. (2011). Understanding music sharing behaviour on social network services. Online Information Review, 35(5), 716-733. 13. PwC Taiwan (2019). The annual report in anticipation of the entertainment and media industry in Taiwan from 2019 to 2023. 14. Sinclair, G., & Tinson, J. (2017). Psychological ownership and music-streaming consumption. Journal of Business Research, 71, 1-9. 15. Thomes, T. P. (2013). An economic analysis of online streaming music services. Information Economics and Policy, 25(2), 81-91. 16. Wlömert, N., & Papies, D. (2016). On-demand streaming services and music industry revenues—Insights from Spotify's market entry. International Journal of Research in Marketing, 33(2), 314-327. 17. Zuora (2019, March 21). Re: The subscription economy grows more than 300% in the last seven years [Online forum comment]. Business Wire. Retrieved from https://www.businesswire.com/news/home/20190321005245/en/Subscription-Economy-Grows -300-Years

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