ByteDance’s music app Resso is making headlines as it plans to expand beyond its current markets of India, Indonesia, and Brazil into twelve new global territories. However, the platform has faced dissatisfaction from major record labels, particularly regarding the low conversion rate of free users to paid subscribers. While Spotify boasts a global conversion rate of around 45%, Resso’s conversion rate remains in the low single percentages.
In response to this challenge, ByteDance is taking a dramatic step to improve Resso’s conversion rate. The platform has announced that it will shut down its free tier entirely, transforming into a premium-only service. Starting next Thursday, existing users of Resso’s ad-supported tier will be offered a 30-day free trial of the new premium service.
Ole Obermann, ByteDance’s Global Head of Music, emphasized that this move will enhance the user experience for music fans while providing greater opportunities for rightsholders and artists. The aim is to build Resso into the leading social music streaming platform, ensuring that artists and creators can benefit from its growing success.
Resso’s premium tier subscription will be priced at R$16.90 per month in Brazil (USD $3.35), which is cheaper than the equivalent Spotify subscription in the country. In India, the subscription will cost 119 rupees ($1.45) per month on iOS, the same as Spotify.
This development comes on the heels of another major music streaming service, Gaana, shutting down its free tier in India eight months ago. Gaana, with over 100 million users at the time, discontinued its ad-supported service in September 2022. The decision was reportedly influenced by a failed investment deal, and shortly before the change, Gaana was rumored to be in talks with Airtel for a potential acquisition.
ByteDance’s decision to focus solely on the premium model reflects its commitment to providing a better user experience and maximizing benefits for rightsholders and artists on Resso. The company aims to solidify its position as a leading player in the social music streaming space.