ByteDance, the parent company of TikTok, is in the process of developing a paid music streaming service, according to Bloomberg.
It was on rumors that ByteDance developing such a music streaming app back in early April. At the time, sources told the South China Morning Post that the company planned to launch the service soon and that over 100 people were working on it.
ByteDance’s service is rumored to launch this fall with a focus on emerging markets. Exact territories aren’t named, but Bloomberg says the company will target mostly poorer countries where paid music services have yet to garner large audiences.
There isn’t much information about the app yet, except that it will offer a catalog of songs and videos on-demand, will have both free and paid tiers, and, according to Bloomberg’s source, isn’t a clone of Spotify or Apple Music.
ByteDance has acquired a tremendous user base in a short amount of time, thanks to smart acquisitions and the explosion of TikTok’s popularity, and it’s been working on all kinds of new apps to find its next hit, including a Slack work messaging competitor called Lark and a Snapchat clone named Duoshan, but a music streaming service might be a more direct way to convert a portion of the TikTok audience into paying subscribers.
According to a report of The Verge TikTok is relying on old licensing deals it acquired through purchasing musical.ly. These deals were originally given at much cheaper rates to musical.ly in 2016 as at the time it was still considered a startup.
Now ByteDance could launch the app in India without waiting for catalogs from the major labels, but that’s highly unlikely. It already has to renegotiate licensing deals with the majors for TikTok itself.
But according to Bloomberg licensing deals for this new paid service are contingent on coming to an agreement on those catalogs for TikTok. Not including them at launch could give those labels a bad taste in their mouth about ongoing negotiations. Additionally, chatter about ByteDance considering an initial public offering this year puts extra pressure on the company to have all of its music rights in place.
ByteDance’s new app is expected to be launched this fall