MEDIA: THE NEXT-GEN GLOBAL DISRUPTORS

With this week’s announcement of TikTok landing former Disney streaming chief Kevin Mayer, the platform’s quest for world media domination got kicked into overdrive. Among the major Chinese media competitors—Alibaba, Baidu and Tencent—TikTok parent ByteDance (valued at $78b) now has the best opportunity to penetrate the Western market and compete against the likes of Google, Facebook, Amazon, Spotify and Netflix.

Mayer gives ByteDance security, experience and connectivity within the Western streaming landscape. And, with TikTok on the way to becoming the most influential and in-demand platform, the addition of Mayer only solidifies ByteDance founder Zhang Yiming’s drive to build the world’s biggest content platform (we’ll come back to this).

So how does music play into this bold move? TikTok’s impact on radio and DSP charts has been unparalleled this year. For breakthrough artists Doja Cat, Arizona Zervas, BENEE, Surfaces, SAINT JHn and even veterans Drake and The Weeknd, TikTok has been the catalyst of their most recent hits. A song going viral on the UGC-based app all but guarantees success.

Along with a record-setting Q1 in 2020 for app installs and reaching a milestone 2b downloads, TikTok has emerged as a Gen-Z powerhouse. Of its 800m active users, 40% are 16-24, and 90% of those users access the app multiple times a day. The influence and attention TikTok generates is comparable to that of MTV in its heyday.

GLOBAL GAINS

As ByteDance is moving the chains, the much larger Tencent (valued at north of $500b) has made strategic investments in Spotify and UMG, while its own Tencent Music is China’s leading music-streaming platform. Will Tencent counter ByteDance’s aggressive move with another investment or acquisition, specifically outside of Asia?

Yiming isn’t the only disruptor expanding outside of his territory. K-Pop giant Big Hit just announced that it’s opening shop in the U.S. with Big Hit America.

While Apple Music expanded to 52 additional countries in April, Spotify has expanded in a different way, leaning into audio content. It recently secured exclusive deals with top podcaster Joe Rogan (independently toting 8m+ subscribers) and Bill Simmons’ culture hub, The Ringer. Could ByteDance see Spotify as the audio component to its visual dominance? Will Tencent up its investment in Spotify to mark its territory?

Meanwhile, Google and Facebook have acknowledged ByteDance’s seat at the table by attempting to kill it. TikTok’s emergence as a legitimate competitor to Google’s YouTube and Facebook’s Instagram has only intensified its rivals’ smear campaigns. It’s worth noting that Mark Zuckerberg attempted to buy Musical.ly before it became TikTok but ultimately lost out to ByteDance.

UPPING THE ANTE

What Mayer brings to ByteDance is a bona fide dealmaker. The highly regarded American exec was involved in locking down major acquisitions while at Disney: Pixar, Marvel, Lucasfilm and most recently, the blockbuster $71b deal with 21st Century Fox. He also oversaw the extremely successful launch of Disney+. Simply creating original content seems short-sighted for the ambitious Yiming and ByteDance—why else would he bring in a major player with experience in streaming and content acquisitions?