TikTok owner bets on Resso & Lark for a Byte of India market

Chinese web big ByteDance is counting on its music streaming app Resso and ‘all-in-one’ productiveness app Lark to forge forward within the Indian market, three years after its flagship short-video app TikTok and others like Helo and CapCut had been banned by the federal government.

Resso, which additionally operates in Brazil and Indonesia, counts India as its largest market. According to AppMagic, it has been downloaded over 125 million occasions within the nation.

“ByteDance and other Chinese companies are still very keen on working in the Indian market, despite some of their top apps being removed from app stores and banned,” David Curry, knowledge editor at Business of Apps, advised ET.

This renewed foray comes even because the Beijing-headquartered agency faces elevated scrutiny and even a possible ban in different massive markets such because the US and in Europe.

India is the world’s largest web market after China with near 800 million customers and supplies an enormous alternative for apps trying to bulk up operations. Resso and Lark are on the decrease finish of significance for ByteDance, contributing lower than 5% to the corporate’s general revenues in 2022, in line with Curry.

“However, they are important to ByteDance’s future as a technology company which is trying to reduce its dependency on TikTok and Douyin in China for revenue,” he added.

Industry watchers estimate that Lark, which is primarily a productiveness instrument, registers most of its downloads in China. It has over 10 lakh downloads on Play Store. Lark contains chat, scheduling, docs, video conferencing, auto-translation and extra in a single platform.

Global technique

It claims to make staff communication easy with out losing time toggling between a number of applications and paperwork and presents a collaboration suite with costs beginning at $12 per seat.

However, there may be sufficient indication that ByteDance’s (international) technique more and more mirrors its strategy within the US, the place it “is trying to make itself look as “unimportant and safe as possible”, Curry said.

Resso growth model

Resso offers subscriptions starting at Rs 99 per month in India. Initially it was pegged at Rs 119, which is also what a Spotify premium subscription costs in India.

While India may contribute the highest number of users to Resso, the average revenue per user (ARPU) is lower than in Brazil, and converting Indian users to paid customers has proved difficult for other music streaming services.

Resso notified users on the app and website that it was going to upgrade to a premium-only service from May 11, 2023.

At the time, ByteDance’s global head of music business development, Ole Obermann, said Resso’s move to a premium-only service will allow the development of a better user experience for music fans, while increasing opportunities for rights holders and artists.

“We are committed to building the world’s leading social music streaming platform and ensuring artists and music creators can rightly benefit from its growing success,” Obermann was quoted as saying.

Ram Mishra, founder and MD of regional and impartial music streaming app Damroo, mentioned that music streaming generated Rs 2,200 crore in 2022 and of this, 87% was from digital area. He mentioned the section is anticipated to develop at a CAGR of 15% and is projected to the touch Rs 3,300 crore by 2025.

“The high penetration of smartphones and internet in tier II and tier III markets is driving growth and the boom in the vernacular music space makes the Indian music streaming space lucrative for a variety of players,” he defined.

On common, Mishra mentioned there are 450 million each day music streams in India and many of the visitors is available in from the highest 10 metros, however that is slowly shifting extra in the direction of the hinterland. “Indians spend 25.7 hours listening to music per week which indicates a clear opportunity to provide an alternate option to video platforms in the vernacular markets,” he mentioned.

Growing requires bans

India banned TikTok and almost 300 different Chinese apps in phases, ranging from June 2020, over nationwide safety considerations. TikTok had greater than 200 million customers in India on the time and regarded India its greatest abroad market. Since then, calls to ban TikTok have additionally surfaced elsewhere too.

India is among the key markets for social media apps because of the sheer measurement of the person base. TikTok’s ban led to the expansion of a number of homegrown rivals corresponding to ShareChat, MX Takatak, Josh, and so forth.

The greatest beneficiary of the TikTok ban in India was Meta, which piloted its Instagram Reels in July 2020 after which launched it globally after huge success in India. Reels’ success in India was aided by the dearth of competitors from the Chinese app.

ByteDance made a number of makes an attempt to return to India, even exploring partnerships with native Indian corporations to assuage the federal government’s considerations on knowledge sharing with China. All makes an attempt, nevertheless, had been unsuccessful.

ByteDance finally laid off its complete India workplace in February this 12 months.