Wang Hao, President of Xiami.com Shen Yunfang of Sina Technology
Do you believe that Ali will be the founder of a new order in the music industry? Before Alibaba Group acquired Xiami, this assumption sounded like rootless wood, because there was no sign that Alibaba was ready to make a difference in music. But after Ali took Xiami Net under his command, a new story began.
Jack Ma Finalize acquisition
Wang Hao can't remember exactly when he met Ma Yun at the end of last year. He only remembered that after a round of conversation, the president of Xiami.com and his four co founders agreed on the spot to "sell" Xiami.com to Alibaba Group. In the previous five years of entrepreneurship, although Xiami.com could not make ends meet, the five people never thought of selling the company.
In this way, Wang Hao and his four partners returned to the Ali system again. Wang Hao joined Alibaba as a development engineer in 2003 and left in 2007 to prepare for Xiami. com. Four of the five founding members of Xiami.com once worked in Ali. Xiami Network has become the music business department among the 25 business departments of Ali Group.
Before agreeing to be a wholly-owned acquisition, Ali had been negotiating with Xiami for investment acquisition for two or three months. There was no lack of opposition in Xiami's team. Wang Hao also had a big question in his heart: Why did Alibaba, which focuses on e-commerce and finance, want to buy Xiami?
As a result, the conversation with Ma Yun became a "showdown" between the two sides. Wang Hao asked Ma Yun why he wanted to buy Xiami. com, and Ma Yun also wanted to understand what the five young people opposite were going to do with "Internet music". Wang Hao described the two sides' directional judgment on the music industry as "coincidental". The deal was finalized in Ma Yun's office on the same day.
The purchase amount of Xiami is still a mystery. But the outside world is more curious about how Alibaba and Xiami view the future of the music industry, and what role do they want to play?
Start a new order
"The traditional content production, distribution and commercialization system of the music industry has been completely subverted, but the new system has not been established." This is Wang Hao and Ma Yun's judgment on the existing pattern of the music industry.
Under the impact of Internet music, the sales of physical records have declined seriously since 2004. When preparing to launch Xiami in 2007, Wang Hao thought that the record industry had reached the bottom, but he did not expect that the next year would be a new bottom. "In fact, the more we get to the bottom of the valley, the less resistance we have to do things," Wang Hao said.
The time may have come to establish a new order, and Ali and Xiami.com are ready to do this together. The former has used 14 years to infiltrate e-commerce into China's traditional retail industry.
It is difficult to express clearly the future model that Wang Hao and Ma Yun envisioned for Xiami.com in one sentence. Broadly speaking, Xiami Network should be a platform that can accommodate the whole music industry chain. Specifically, Xiami.com may become Taobao in the music industry in the future: on this platform, Xiami.com gathers grassroots musicians to provide promotion and sales channels for the latter. When the group size is large enough and the community viscosity is strong enough, professional groups such as brokers, songwriters, musicians will also have growth momentum and space on Xiami.com. If this ecosystem is established, Xiami Network can collect all music content production, promotion and sales, and the so-called "Internet music industry chain" will be opened.
It is easy to see that Xiami's model logic is Taobao's logic. In addition to the basic businesses, the surrounding industries such as agency operation, community-based shopping guide, models, photography, etc. are thriving in the ecology of Taobao. The same is true of the business ecology Xiami wants to achieve. Wang Hao, who has always regarded Ma Yun as an idol, is also familiar with Ma Yun's "business philosophy": don't think about collecting money from the poor, help them get rich first, and then distribute benefits to them - this is the root of Taobao's success.
"Musician platform" is the most important step in the grand idea of Xiami.com. According to the rules of this platform, musicians can spread songs on Xiami Online and set their own price (currently no more than 50 yuan/song). The lyricist, composer and song recording producer can respectively get 10%, 10% and 80% of the income. That is to say, Xiami currently does not charge any party on the platform. Musicians need to bind their own accounts to Alipay, and Xiami Network will settle the income generated by these music on the platform to all parties by monthly settlement. "Musician Platform" is also open to famous artists of record companies.
Wang Hao said that Xiami's self positioning will always be a platform rather than a record company. But this platform needs a successful case to prove the feasibility of its own model - just like Taobao needs a successful Taobao brand as a model. In the traditional music system, a singer needs to be packaged and promoted by a brokerage company to become famous. If Xiami wants to create another Internet music ecosystem, it must also provide musicians with the promotion resources needed to become famous. According to Wang Hao, in addition to the promotion of its own platform, Xiami has embarked on the "Direct Train" and "Musician Fund" projects. The former is mainly to send potential musicians on the platform to variety shows, record companies and music festivals, while the latter is to directly provide financial support for music production to musicians.
Wang Hao has set aside three years for himself on the "Musician Platform": "It will take three years to build this platform to a large enough scale."
Unknown "X Mode"
In terms of the future collaboration between Alibaba and Xiami, Ma Yun and Wang Hao have only set a general framework, which is internally called "X-mode".
From the perspective of channels and platforms, Alibaba, which owns Taobao and Tmall, may be the most qualified Internet company for digital music distribution in the future. Compared with the previous single fight, Xiami.com can mobilize more resources after joining Alibaba. But if you think Ali just wants to "sell music like clothes", you may be narrow-minded.
As for the curiosity of the outside world, Wang Hao only listed three possible collaboration methods.
The first is to treat Taobao platform as a pure sales channel. For example, Xiami and Ali lead the cooperation with Taobao sellers, who will give musicians' records when selling clothes, bags and other products. Of course, selling digital music directly on Taobao by musicians or institutions is the most understandable mode for the public.
The second is the combination with the background music system of Taobao and Tmall stores. In Taobao's system, sellers can set background music for their stores. Wang Hao said that in the future, when setting up background music, sellers may need to pay copyright fees to the copyright owner of the song.
The third is the direction of artist brokerage. If Xiami.com can establish its own music ecosystem, sellers can find suitable musicians on Xiami.com to endorse their brands.
"I can't tell you how many directions' X mode 'contains, because it is inherently unknown." Wang Hao said that as long as the existing user experience of Taobao users is not damaged, Xiami and Alibaba will actively promote attempts in various new directions. In April this year, the two sides tested the service of shopping while listening to music on Taobao.
Xiami.com prequel
When meeting Wang Hao in Beijing, he came from Hangzhou to participate in a cooperation activity with a fashion media. The 34 year old entrepreneur looks younger than his peers. For a long time after graduation in 2001, Wang Hao spent his spare time promoting and organizing original music. He once made a music forum called "Sound" to update the news of various offline original music performances in Hangzhou. In those years, he often went to the "Traveler's Bar" on Shuguang Road in Hangzhou. Wang Hao also built his own station to sell imported musical instruments such as guitars. At that time, there was no Taobao or Alipay, and transactions were completed by post office remittance.
It was also the experience of that period that made Wang Hao understand the dilemma of grassroots music's life: "If the annual income of 40000 is a threshold, about 90% of grassroots musicians are outside this threshold." This has also become the motivation for Wang Hao to establish Xiami Network - to provide a platform for grassroots musicians to promote and make money. The earliest Xiami Net was named "EMUMO", meaning "Earn Music&Money".
However, it is not easy to build a music community platform, and it is even more difficult to make money from music itself. At present, mainstream Internet music companies rely on advertising, games and other means of flow realization to maintain operations. Although Kuwo, Domi, Douban Music and other companies have also started to try to charge for high sound quality, they are still in the initial stage. For example, after three or four years of implementation of Kuwo's charging service, the number of users is only about 10000 - you know, the monthly number of active users of Kuwo's music is close to 100 million.
Since its launch in 2008, Xiami.com has between 15 million and 20 million registered users, and its monthly active users are 67 million - these numbers are not of an order of magnitude compared with other music websites that are prone to hundreds of millions of registered users. Xiami currently earns about 10 million yuan a year, barely able to support a team of 100 people. In the past few years, Wang Hao's team could only pay about 20 million yuan of copyright fees annually through financing.
Before the acquisition, Xiami was seeking new financing. For Wang Hao, the most obvious change of being acquired by Alibaba is that he no longer has to worry about the problem of funds. Previously, advertising and paid downloads accounted for half of Xiami's revenue. This year, Wang Hao decided to cut down all advertising projects on Xiami. com. The president who has always talked about "integrity" believes that advertising cannot change the industrial ecology of Internet music
On June 5, Xiami will launch VIP monthly trial service. For Wang Hao, letting users pay for the value of music itself is the industry state he most wants to see.
