1. 1
Key Findings of In China’s Digital Music
Market
2012-2013
Digital music service gains
continuous popularity.
In 2012, digital music
subscribers (users) reached
385 million， accounting for
75.2% of China’s Internet
users which increased by
3.8% than that in 2011. In the
field of mobile Internet Apps,
digital music service apps
occupied 50.9%, increasing
by 5.2% than 2011.
With the existence of
online music performance,
China’s digital music market
has expanded at a rapid speed.
Owing to the creative
format of music performance,
the annual turn-in of China’s
digital music market has seen
vast increase in 2012. The
annual online music revenue
has reached 1.78 billion
RMB, increasing by 300%
than the year before, Wireless
music service revenue has
slightly increased to 32 billion
RMB.
The young demographic of
China’s digital music
consumers exhibits less
enthusiasm in purchasing
music online.
A survey conducted by
Entbrains found that the key
demographic of China’s
digital music users is younger
than those of other online
services. Users under 30 take
up 65%, Users with bachelor
or higher degrees account for
67%. However, since most
online music services in
China are free, users/
subscribers show less
enthusiasm in online music
purchasing. Only 8.5% of the
respondents are willing to
pay for online music
downloads. Yet on mobile
music apps, about 20%
respondents condone to the
idea of paying for music
downloading. Among them,
70% prefer a monthly
subscription fee, while 25%
prefer to pay for single
purchase.
ENTBRAINS
focus on digital
Entertainment.
We learn it.
We observe it.
We research it.
We do it.
中娱智库

2. 2
Online music video service has developed
rapidly
According to the survey conducted by
Entbrains, online music video service has
developed rapidly since 2012. The monthly
active users of such music video online
platforms as YinYueTai、Youku、Tudou etc.
has exceeded 50 million.
Online music performance format brought in
impressive profits.
In 2012, online music performance has a
revenue of 00 million RMB. ARPU of monthly
subscriber is 243 RMB.
Alternative music contents draw broad
attention.
China’s digital music users’ consuming
behaviors have been influenced greatly by
the popularity and success of such single
television shows as “The Voice of China”.
The songs featured in the shows are
mainstream hits in the music industry. Many
digital music service providers are competing
for the releasing rights to those key music
contents.
Digital music regains popularity among
investors.
Mobile digital music application
“Changba” received an investment of 15
million US dollars from Series A.
Huayi Brothers and A8 Music
respectively invested 3 million and 6 million
US dollars in Duomi Music.
Alibaba acquired Xiami Music.
Industrial regulations help China’s music
market grow rapidly.
In 2012, the Chinese government
imposed stricter regulations on China’s
digital music industry. Copyright
infringements.
In 2013, Entbrains is working with the
Chinese government to draw up “The
National Online Music Industrial Standards”.
These standards correlate with international
music industrial standards. The set of
standards will help formulate the business
models of China’s music industry and help
innovate music services and promote rapid
market growth.
ENTBRAINS中娱智库

3. 3
China’s online games market achieved
steady growth in 2012.
In 2012, China’s online games market
achieved steady growth with revenue reaching
60.3 billion yuan (RMB). The number of online
games players exceeded 190 million. The number
of client games and web games players slowly
increased. The development of online games
market relied much more on current clients
growth potential rather than client qantitative
growth. The scale of mobile online games players
continued to expand rapidly with an increase rate
of over 100%.
China's online game products supply
continues to increase.
In 2012, there were 883 online games that
passed government review or filing. China's
domestic online game products continued to
increase and dominated the market.
Online games export scale continued to
expand.
In 2012, the scale of domestic online games
export steadily expanded, bringing in 600 million
US dollars. Mobile online games enjoyed apparent
increase than 2011. Copyright exports increased.
On the whole, the revenue share of each
exporting mode hasn't experienced dramatic
change.
China's online-game businesses showed less
enthusiasm in investment activities. There were
totally 23 reported investments. Four online-game
companies listed in the stock market. Financing
was often seen in mobile online-game field.
Client games market is nearly
saturated. Web games welcomed another
growth breakpoint.
In 2012, faced with the competition of online
videos and other forms of entertainment, and with
web games and mobile online games attracting the
majority of users, the increase of client games
players slowed down. The client games market,
especially the markets in the first-tier cities nearly
saturated.
Mobile online game market continues
to prosper with new opportunities.
Owing to the improved mobile network and
the popularity of mobile devices, mobile online
games market continues to prosper and mobile
online games experienced rapid development.
In the chain of production, more efforts
are put in D&R. Product-oriented becomes
the mainstream guideline.
The current business models for web games
and mobile online games dictate that "winners
have it all". Popular games are often among the
best on the market.Products that gain high profits
will attract more resources through different
channels.
Open-platform mode exerts more
influence. Small enterprises moving into
big enterprises' platform is the
mainstream.
The emergence of open platforms indicates
that China's online-game market has fully
developed. Monopolies dominating the resources
on the production chain is hardly seen. Big
enterprises are prone to cooperate with small
enterprises to achieve win-win by sharing
resources.
Entbrains maintained that China's mobile
games market is still at its early stage of
development. Plagiarism and client frauds still
exist. In 2013, the Chinese market will issue
certain regulations regarding mobile online games
so as to regulate and manage China's mobile
games market.
Key findings in China’s online
games market in 2012
中娱智库Entbrains

4. 4
About Enterbrains
Beijing Entbrains Consulting Co., Ltd., focusing on information consultation and strategy
research of digital entertainment field, has provided professional research report,
consultation, strategy consultation and conference activity service for enterprises of
digital music, online game, etc.
www.entbrains.com
Contact us:
Terry@entbrains.com