Episode 97: How Artists Build Real Fans In China (Platforms, Strategy & What Actually Works)

China can look like the biggest opportunity in music and the easiest place to get lost. I sit down with Jonathan Heeter, who runs Middle8, an outsourced China division for Western labels and artists, to translate what actually works on the ground and what Western playbooks get wrong.

We map the Chinese music streaming landscape through Tencent’s QQ Music ecosystem and NetEase Cloud Music, then dig into why discovery algorithms can feel more sophisticated while staying stubbornly opaque. The real unlock is measurement: when public streaming data is limited, engagement becomes the signal. Jonathan explains why comments on tracks matter, what “memetic behaviour” looks like across Chinese platforms, and how that turns into measurable fandom you can take to promoters and brands.

From there we move into monetisation and deal structure. China’s music business often operates holistically, optimising total revenue across streaming, touring, brand partnerships and IP, rather than treating each income stream as a silo. We also get practical about sync licensing in China, why buyouts are common, and why commissioned brand integrations can be far more lucrative than chasing back-end pennies. Finally, we cover must-know platforms for music marketing in China, including Red Note (Xiaohongshu), WeChat, Bilibili and Weibo, plus the realities of expensive paid media and real-name verification rules.

If you’re an artist, manager, label or publisher building a China strategy, this is your roadmap. Subscribe for more music business insight, share this with someone planning an international campaign, and leave a review with the one China question you still want answered.

https://middle8.agency

Transcript

Welcome And Why China Matters

SPEAKER_01 0:14

Hello, and welcome to the music business today with me, Johnny Amos, podcasting out of Birmingham in England. I'm the author of the book, The Music Business for Music Creators. I'm a music creator myself. I'm an industry consultant, an artist manager, and a senior lecturer in both music business and music creation. Wherever you are and whatever you do, consider yourself welcome to this podcast and to a part of this community. My goal is simple, everybody, to try and inspire and educate music creators from all over the world in their quest to achieving their goals by gaining a greater understanding of the business of music. Okay, I have a tantalizing session for you today. I am joined by a remarkable guest by the name of Jonathan Hita. He doesn't like compliments, by the way, but you better get used to it in this episode. So I'm going to give him minute. He is outstanding. He is such an impressive person. So, what does he do? He runs an agency called Middle Eight, which is ironically a team of eight people, but I don't think that's where the name came from. They are a China division for artists and labels from the Western world. Now, let's just think about it like this. I have long thought for many years that China must be the biggest music market in the world, given how many people are there and how many hundreds of millions of daily listeners there are in China and the fact that there are so many cities. I think Jonathan said today, I think it's something like 144 cities that have a population of more than one million people. So I'm in the UK. Uh there is what, I guess, two or three cities that have a more than one million people. Uh and it's utterly remarkable. The size of the market, it's just pure numbers, right? Now we know that year after year, the the big music markets in the world are the USA and Japan and the UK and so on and so forth. It's usually the usual leaderboard. But I boldly predict that as we roll forward and data gets better, China will become the market leader of the world in music. Who knows? Maybe I'll be wrong. I think they're going to be a huge music market. They already are, but we just don't understand how big it is. Now that is why I wanted to bring in Jonathan Peter today to discuss exactly what he knows about the Chinese market, um, what he does for the Chinese market and for the West that want to move into the Chinese market and how different the landscape is. Um, this is such an education, everybody. I hope that you get from this as much as I did it comes to the interview. Jonathan, welcome to the music business, buddy. Uh it's good to have you here. How are you? Doing well, Johnny. Thank you for having me. Oh, no, it's a pleasure. Pleasure. I'm absolutely fascinated by what your company does, by what you do and how you got into it. And uh, you know, so I'm thrilled. I'm really, really pleased that you agreed to come on. Um let's get to it. There's so many things I wish to ask you. Um I um would I be correct in saying that that middle eight is like an outsourced China division for Western labels and artists? Would that be an accurate description?

SPEAKER_00 3:25

You're exactly correct. And so so much so to the point that I wish that like most of our clients understood that when they you know initially reached out to us. That is exactly how we're set up. Um, obviously, most of the music business, they have business that's occurring in China. Kind of even if you're like a middle-sized independent uh record label, you probably have something that's connected in China or you probably want to. And you probably don't have the resources to have open your own operation in the market. And so we fulfill that need for people. Uh what half of our clients are uh record labels, but the other half are artists through their management. Um and so we're either an outsource kind of commerce, marketing, catch-all team for record labels,

Middle Eight As Outsourced China Team

SPEAKER_00 4:10

or kind of a I don't like to use the word co-management, but it's the easiest thing to use, kind of a co-management or management consulting um situation for artists. And um, you know, to do all of that, we have creatives, we have AR people, we have marketing people, and then um have maintained through the course of the sort of 17 years I spent in China pretty strong relationships with the DSPs and the major social platforms over there.

SPEAKER_01 4:37

Right. Okay, that that uh that makes a lot of sense. Um, I think it would be really um useful for people to get a kind of better understanding as to the size of the Chinese market. Um, I've often kind of just thought to myself that surely China's kind of like the biggest market in the in the world in terms of recorded music. Um it has, you know, undoubtedly there's hundreds of millions of uh daily listeners of music. Uh can you give us an idea as to the sort of the size of the market?

SPEAKER_00 5:08

Yeah, well, I mean, if you go by our friends at IFPI, it's uh technically as of as of this most recent report, the fourth largest music market in the world for recorded music. That's an interesting counting um statistic because China is basically purely a digital market. So what you're basically getting there is all of that revenue is only being generated from streaming. There is very de minimis physical sales, um, especially for any international music and even for domestic music um within the market. So if you go digital only, I suspect you're probably right that it is the largest digital market in the world. Um, but IFPI, it's about number four. In terms of those daily active users, I mean, obviously every platform is in charge of their own numbers, but you're definitely talking about hundreds of millions of people, if not more, um, on the DSP side listening to music. Um, you know, the main DSPs that everybody should know, uh Tencent, who you will know as kind of a holding company, everybody will be familiar with that. They have three DSPs that fall under the Tencent umbrella QQ Music, um, Kugo, and KUO. Um, and then their sort of main competitor in the market is a platform called NetEase. Um, obviously, with all of this consumption and all of these platforms happening in one market, they're a bit more differentiated from each other than, say, Apple Music and Spotify would be. So NetEase tends to be for the percentage of the market, it's kind of hardcore music listeners. Um, there's a lot of things from a UX, a UI, and kind of a social integration thing that connect with fandom and really reward deep listenership. QQ tends to be QQ music from Tencent tends to be the place where um, you know, the average person is kind of listening to music in many ways because QQ is a brand that's extended all the way back to a messaging app that was very popular in China going back to the late 90s. And then Kugo and Ku are popular um in places in China uh sort of outside the major cities, simply because they require less bandwidth to stream off of. Um and that's sort of a little slice of the market. If you add all of those up in terms of like a daily active user base, I have no idea what it is, but it's gonna be a number that's like so parsically large that it's not even gonna make sense to anyone.

SPEAKER_01 7:33

Yeah. Okay, wow. Yeah, wow, superb analysis. Um, I've never spoken to anybody that can give me that kind of analysis before. That's that's amazing. Wow. Um, so QQ Music, do is their sort of um their algorithm as sophisticated as, say, Spotify in terms of sort of you know, music discovery and and the visibility for emerging artists and that kind of thing?

SPEAKER_00 7:58

I'd actually say on the whole, kind of everything in China, whether it's going to be in the DSPs like Netties or QQ, or whether it's the social media platforms, which we'll touch on in a second. I think the algorithms are actually more sophisticated and a little bit better than um in the quote unquote West or globally. And I think there's some different reasons for that. Technically, I think it's really easier to optimize for data streams that are coming mostly from one market than from a lot of places. So there are fewer sort of engineering restrictions upon how those algorithms are built. Um, nobody's idea of a techie, but that's uh that's sort of my understanding of it. And then the second piece is that uh China skipped a lot of

DSP Landscape And Market Scale

SPEAKER_00 8:40

steps uh in terms of development and people went digital very early um in the market. And because of that, a lot of the things that we found really innovative. So, for instance, like TikTok, people say all the time that like, you know, TikTok uh has a Chinese version called Doyin. It's actually the opposite. Doin has a has a global version called TikTok until very recently. It's an app that's much older um in China and really follows the sort of algorithms and logic of the way things work in China. Um it's kind of really optimizing um for engagement and for rapid fire use. So, from a listener's perspective, especially like if you're on Net Easy, it's pretty easy to go from like suggestion to suggestion within the DSP and be served by music that that you might find to be a little bit more of a uh satiating experience than uh sometimes I have found it to be with other algorithmic platforms and other places.

SPEAKER_01 9:39

Interesting. Wow. But presumably it sort of crowdsources data in a similar fashion and hyperpersonalizes it for each listener in the same way, does it?

SPEAKER_00 9:49

I I assume so. Um I mean, I think that one of the things about Chinese tech companies is that they're all sort of like walled gardens and very secretive. So they're not gonna let you inside the black box to really explain what's happening with the algorithm. Um, the same way that like, you know, your listeners will probably be familiar with the experience of talking to someone at TikTok, maybe in the music department, and asking them a question about the algorithm, and they're like, I have no idea what's actually going on. That that actually um is pretty common. So to me, it's actually kind of a red flag in China for me when I hear people say, like, we understand the algorithm or we know what's gonna happen with the algorithm or this, because I don't think it's actually really possible.

SPEAKER_01 10:30

Yeah, okay. Well, if if you of all people are saying that, then yeah, yeah, yeah, yeah. I think that's uh safe to say, yeah. Um, so one of the many things that have intrigued me about this subject, uh, you know, is that Western artists and their teams have traditionally really struggled to kind of break into the Chinese market or even understand it. And I for many years, Jonathan, I've seen many music executives in the UK going to China, being very positive about it, coming back, and then really struggling to actually yield the kind of results that they were hoping for. Um, you, on the other hand, actually make things happen. So, what is it that you're doing that's different from other music executives?

SPEAKER_00 11:15

I mean, I think that, you know, one is that I spent most of my adult life in China, right? I was there for 17 years. And so my role often is actually as a bridge between talent in China, talented people who are doing the hard work of marketing and explaining what's going on. And I think most of the time, what's missing for Western music and entertainment executives and brands and everybody else is a lack of somebody to play kind of the role of building connective tissue between understanding what's happening in China and what's happening in the rest of the world. Um, and music specifically, music is a very metric-driven business now, where people are very obsessed with certain metrics. Unfortunately, those metrics are not the same in China. And so what that means is that there's often not a simple way for executives to understand what's happening in the market. And so the burden of kind of communicate, communicate communicating what's happening is a highly qualitative rather than quantitative, and B requires someone who understands China and America or China and the UK or China and Germany or whatever, to be able to kind of explain what's happening within the market. Um so to me, it's more a process and a communication issue rather than anything else. And there haven't typically been a lot of resources uh, you know, for Western executives to be able to kind of learn about the music business, um, specifically and about what works. So I'll give you an example of this metric difference. I'm never really because streaming data isn't publicly available across releases in China. So let's say an art, you know, artist manager reaches out to me and they say, How big did our song do in China? Like what are our monthly listeners or whatever for artist projects? You can't actually tell that from looking at the public platforms. That data set isn't publicly available. But what we're actually looking for is comments. Because unlike uh Western DSPs, each track um has a very active comment section. And so what I want to see for what happens with engagement and listenership, and really the kind of buzzword of the last several years, fandom, is I want to see comments. I want to see engagement. So, for instance, our goals will often be we want artist XYZ to have 100,000 comments across their music within, you know, one month of this campaign or something like this. And that's that's an awesome goal. And it makes sense if you're working with me every day. But if you're uh sitting in an ivory tower someplace, and then you've got to go back and you've got to talk to an investor, how are you gonna have that conversation? Right. So it it breaks down into two things. One, you need to be able to understand those metrics. And then two, you need to move beyond the streaming numbers that kind of the Western business, music business is is somewhat obsessed with, and think in terms of total revenue for the artist. And that total revenue, why do I say total? Because it's revenue from streaming, it's revenue from touring, it's revenue from brand partnerships and deals and IP creation, all of these things. Um, and this springs from something that's like very different about the music business in China, which is also underpinning your question. Um, in China, there's no real such thing as a record label or a concert promoter or an agent or a manager. All of these things sit inside of one company who's managing kind of all aspects of what's happening uh within the market. So that means they're optimizing things within the market to play to get generate total revenue. Whereas if you're a record label from, I don't know, from from from the UK, right? And your main stream of of revenue is just streaming, you're not gonna have the incentive structure

Discovery Algorithms And The Black Box

SPEAKER_00 15:10

in place to look at the total, the sort of the total picture of the market. So the successes that we've been lucky enough to be a part of. And it's I don't know, it's never me. It's like when I was at Warner, it was a big team of people that were doing it. And then now at middle-aid, it's a really good uh you know, team of eight of us, ironically, was not eight when we started, but it's eight of us now, um, kind of doing everything um together. It's all cases where we're able to think holistically about revenue, um, wherever it's going to come from, and then engagement driving into that revenue. So it's it requires people to have kind of a completely different mental picture of what they want to do in the market. And I'm not sure if I can curse on your podcast, but most people they most people just say fuck it. Like your average, your average record, you know, your average record executive is just gonna say, ah, fuck it. And that's basically what happens in most cases, even to some degree within the major labels.

SPEAKER_01 16:14

Wow. Okay. So just go to those two pieces that you mentioned there. So you're looking at the overall total revenue of all aspects, right? It's a song revenue, recording, live, all that kind of stuff. So it's therefore difficult for Western companies to see, let's say, their counterpart positions, right? Like what are the publishers doing? What are they okay? I did not know that before. Um that's really interesting. Okay, so you said about the comments and the comments being like a metric for growth. That to me feels a little bit like um like Western labels, especially nowadays, I've noticed, especially last year, in fact, in 2025, before let's say launching an artist, they would run a lot of behavioral data checks.

SPEAKER_02 16:57

Sure.

SPEAKER_01 16:57

Um, so comments, um, repeat comments, especially. Is that the kind of thing that you're looking for? A sort of behavioral data type thing?

SPEAKER_00 17:06

So, what I'm really looking for is actually what I like to call memetic behavior. So, what that means in relation to things that are engaged is that people take the music and they do something with it, right? Doing something with it can be sharing with it, uh, you know, sharing it with other people at kind of the lowest level. Uh, at a higher level, it's going to be using it to soundtrack their music, using it to um to go on Red Note and kind of soundtrack kind of a mood board, and then obviously to do all the things you'd be familiar with from short video platforms, um, like TikTok, which is go inside of it and do do the silly dances to it and the challenges and all of those other things. So it's that combination of engagement and mimetic behavior that I'm actually looking for and kind of tracking. Um, that probably rhymes with what you're talking about from a behavioral standpoint. The difference is I'm looking at it in China um in different places uh in different ways. So I'm looking to see certain stuff on the DSPs, which is basically commenting behavior, um, which will then show engagement, which will allow me to understand what should be happening from a streaming perspective. Um, and then um on the social platforms and the places where we're doing marketing, I'm looking to drive that as a lever to actually get listenership and fandom, really. At the end of the day, I think the other big difference is I obviously want consumption because everyone makes money off of that. But what I really want is fandom in the market. I want to be able to go to a situation where I have a measurable audience for the artist, and I can say to a promoter, this is how big the audience is. This is the percentage of the audience that's engaged. Therefore, um, you know, the guarantee should be this for a show, right? Or I can say to a brand, this is this is the size of the audience. If you work with this audience to do a track for your advertisement that's purpose written, or you buy a sync or do something and do a content integration with them, you know, you're gonna be getting this large of an audience, uh, essentially coming along with you. Um, and that's really kind of how you unlock China. It's thinking about you know, taking that audience and then monetizing that audience across as many different things as possible. It's not the siloed Western music business approach of um this is one thing that's making money, this is another thing that's making money. And it's because the music business in China is relatively new and it developed in harmony with the way that digital technology works, not kind of before and then has been augmented afterwards.

SPEAKER_01 19:48

Yeah, yeah. That's um wow, God, this is really making me think so differently about a lot of things because we started to see now, you know, as as you will well know, you know, a lot of rights management companies in the West, let's say, uh that kind of go, yeah, we do music publishing and we do this, and we did and we do like neighbouring rights, and uh and they're kind of starting to group things together because some of the old income streams are not as powerful as they used to be. And so it's making me think, right, actually, since the dawn of the digital, let's say, in China, because they group things in the way that you're so brilliantly explaining, it's making me think, actually, maybe it would make for a stronger uh ecosystem for us to do the same thing.

SPEAKER_00 20:32

Um it's it's trade-offs though, right? Yeah. So let's say you're an artist and everything sits

Breaking Artists: Comments Memes Fandom

SPEAKER_00 20:40

under one roof. Like that could be good, it could be bad. Maybe the roof keeps out the rain, maybe the roof doesn't keep out the rain. Right now, in a situation, if you're an artist, you know, in other countries, you could have a not so great relationship with your label, but your agent could be doing an amazing job and getting you getting you bookings, and your manager could be doing an amazing job kind of driving everybody. Uh, it's pretty hard for your manager to play bad cop when he sits next to Bob from accounts and has to go to coffee with him afterwards. And so, like anything else, there there are trade-offs. I think from a a digital first perspective, um, you're definitely already seeing more labels and management companies kind of feel like they're the same thing or doing the same thing um in in the West anyway. Like it's not a coincidence, by the way, the 88 Rising is really both like a management company, for instance, and a record label, and it has all the Asian DNA and all the Asian roots. It's very much set up like an Asian company, um, you know, an Asian media company, but in sort of New York and then California.

SPEAKER_01 21:52

Yeah, okay. That's that that's that's a good example, actually. That makes a lot of sense. Um just a quick thing there about. kind of um sync licensing so you mentioned there about brand integration and like a a song or recording of a song with a particular brand um is there the kind of like the infrastructure for sync licensing in terms of like back end collection and that that kind of thing with the PRO or is the it or is there not really a system like that and it's more of a kind of you're doing this recording for that brand and that's the end of it or you know is it more or somewhere in between?

SPEAKER_00 22:29

I mean there is a back end but honestly the money lies in the sophisticated kind of uh commissioning of work. Okay. Again because like you know a big brand is going to want to work with you in a holistic way. They're not just going to want to take your track um and then kind of you know stick it in a commercial or even stick it in a film or something. They're gonna want it to be an integration. And if they do just want your track, what they're gonna be interested actually is the pub. So they're gonna get the pub from you and then they're gonna re-record a version of it. But the simple logic that the sort of Chinese buyer side has figured out which is if we're paying for this we might as well create a product ourselves. And then they can then promote that on DSPs and it's more integrated into their rollout. Yeah so that tends to be you know those situations in general like probably some other people in the China space won't be that happy with me but buyouts can make a lot of success a lot of sense for people um because you're getting money kind of all at front um and collection is not always the easiest thing to do it's not always difficult they're very reputable people as well but in general the kind of deals that we're typically working on with people are commissioned work just simply because they're much more lucrative.

SPEAKER_01 23:46

Yeah that makes a lot of sense I mean the music publishers that I that I deal with in Europe that that know the Chinese market that pitch the Chinese market they'll they they refer to it as a buyout territory. So if there's a tongue that's got cut you know it's you get the a buyout fee for the tongue and for the recording and and that's that's the difference that that makes a lot of sense. What about um sort of are are there sort of would you say uh you know cultural uh differences that exist in the Chinese market that would be very difficult for Western artists and labels to understand other than the sort of the things that you've explained so far. Is there anything else that that people would might struggle to understand?

SPEAKER_00 24:26

Yes but no um and the reason why I say that is for most Western artists you're not really gonna ever be reaching all of China anyway right it's a big country with its own culture and its own music. A lot of people are going to prefer to listen to that music that's local. So the kind of people who are actively seeking out you know global artists, Western artists and like connecting with them for fandom, they're gonna be more cosmopolitan and culturally aligned than you might expect. And the difficulty then of course is all of the nuances which in a self-serving way is what makes someone like my team very valuable. Because it's all the little things. It's like give an example for your UK listeners that is an American was always endlessly frustrating for me living in London which is I got got to my little my little flat in London and there are these two taps one with hot water and one with cold water instead of it all coming into one place. And I was like what the the what like what the fuck is this? Like wash your hands am I supposed to just run my hands back and forth between the two sides and of course culturally in the UK it's like when you do your dishes you have a basin and there's a whole other thing that's different right and so this is like a tiny difference that kind of represents those nuances um that are there in that that sort of audience. And then you have the big differences right language is a big difference. Like everything from the way colors are perceived like the relationship between red and green is often opposite where red is positive and green means negative. It's like if you see a stock market chart with something going up it's going to be a red arrow going up. Right? Interesting so there's all these little nuances that are there. And that's a topic you can kind of sort of pick on forever the honest way for people to really approach that is actually again this is very self-serving but to work with somebody who can navigate that sort of stuff because it's just too much to learn. It'd be like you know if you ask asked me to like figure out I don't know Mexico or something be like I could do that or I could just work with people who really don't like Safel.

SPEAKER_01 26:26

Yeah yeah yeah yeah exactly yeah that's uh that makes a lot of sense so as as uh as an agency then do you do you operate on a kind of fee-based service or a commission-based service or is it a bit of both?

SPEAKER_00 26:39

Uh it tends to be a bit of a bit of both there are some things that are that are almost exclusively uh retainer based and we've never really done anything um that's like fully commission based we wouldn't necessarily be against that but it would have to be you know it would have to be something where it was like pretty obvious what was going to happen um that was going to come online. But we try to put ourselves in a position where um essentially the revenue from retainers secures our floor and our real upside happens uh with the commission based model that we use for most people.

SPEAKER_01 27:23

Yeah okay yeah that makes uh that makes sense yeah thank you um you yeah I think you mainly covered this earlier about the the sort of the the overall kind of overview of the ecosystem. Is there because it's gonna be hard right for people to be on understand this Twitch from kind of Spotify, YouTube, TikTok etc um you know and the things that replace it are there any other kind of uh platforms that that are kind of uh you know big in China or unavoidable in the Chinese market that that you've not mentioned?

SPEAKER_00 27:54

Yeah I mean a lot and some of them are accessible in the West some of them aren't Doyin which is the Chinese version of TikTok you will not be able to download it unless you have a Chinese phone and even if you did you wouldn't be able to use it because it's it's GPS geo block to China. But um everyone who's in the music business should have Red Note or Red, I think as it's now called in English downloaded on their phone. The app doesn't work exactly the same way outside of China but everybody should have their every artist should be posting on there even if it's in English um just as a start. And that's um a very important kind of lifestyle tool again because you have all of these different platforms within one market they're kind of differentiated from each other. Red is kind of a little bit more focused a little more leans a little bit more towards women a little bit more towards like health and beauty and a lot of other things but it's very important is kind of a lifestyle component when you can actually see it. So this is something where you could imagine if like Pinterest was a social media app would be the best way that I would describe it. Essentially everybody should be at least fooling around with it in the music business to get a flavor of it. Billy Billy is essentially the Chinese version of YouTube. It is as the sort of somewhat whimsical name might indicate uh heavily targeted towards younger users specifically gaming um anime and comics uh tends to be a very big space for music and a lot of Western artists who crossed over tend to do very well um in those spaces particularly um within the market WeChat is sort of available uh for people to look at globally and get a flavor of but in a very neutered form um if we were going to do an explanation on what WeChat is we would be here for the next three hours. It's such a complicated platform that does everything from mobile payments to uh paying your utility bills to functioning like WhatsApp to having short video and blah blah blah baked inside of it. It's incredibly important on the ground in China from the CRM perspective. From um an international artist perspective I tend to think of it as like your website where it's like you need to have it, you need to be posting on there, but you

Monetisation: Touring Brands Buyouts

SPEAKER_00 30:20

don't necessarily expect a lot of virality or or ROI from it directly. The one playboy play playbook that you're probably a platform, excuse me, that your grandma probably knows is Weibo. Weibo is quite old um it's very similar to kind of Facebook and Instagram mashed together. It's not a platform that like we we are generally operating things um on Weibo for people and it can be a very effective source of sharing news but it doesn't tend to drive a lot of um streaming or fan behavior. It's more kind of like where you would go if you were sitting in an office building uh and you're like I'm at work and my email job is boring today what's going on you open up Weibo on the you kind of review what's happening there in the background and check back.

SPEAKER_01 31:08

Right. Okay. And um can visibility for Western artists and labels be bought on those platforms in the same way as it can in the West You mean visibility in terms of like can there be boosting or posts and things like that?

SPEAKER_00 31:22

Yeah and kind of like yeah okay very important. Um it's a good shout specifically to talk about that people probably have the understanding that like China would be cheap because we get lots of cheap stuff from China. China's very expensive from a media perspective. One you've got all these eyeballs operating at the same time every day in the same place. Two it's all digital so like your budget on Doyin, congratulations it's going up against Procter and Gamble's budget not exactly in the same vertical but like what's that going to do to the cost of an influencer right? It's gonna drive everything up. So this means that you need to A be very smart in terms of where you're spending your money in the platforms you need to really work with people who understand what's going to drive the needle uh you know forward move the needle I don't know if you can drive the needle it'd be very challenging um to kind of move the needle forward. Um and then you also need to be thinking about the the ways in which that boosting budget is kind of achieving very specific goals for you. One other thing about all of the social media platforms is that they are tied to a real name, real identity identity in the market. So you are you all the users are them um which means that one the internet in China is a kindler gentler place uh because people are much less likely to be assholes if you can figure out who they are pretty quickly and be named and shamed. But then two, it means that some of the shenanigans that happen, like maybe there's a certain artist and you see the same seven second clip of that song across 75 fan pages at one time all of a sudden like some of those shenanigans are not that they don't exist but they're a little bit harder to pull off is uh is it kind of mandatory verification on ID then it's it's law. Yeah it's law the internet law interesting wow okay so yeah that really cleans up behavior then wow so there's like total accountability yes like every artist we're working with we you know essentially have their proxy more or less and are operating the accounts on their behalf. And then obviously for entities for a for a business there's a there's a different set of verification that happens but but it also has to happen. And this is actually like a big red flag for anybody in your audience that like if you're working on a China solution and they're not talking to you about how to like verify or authenticate anything um or if your label says something you like oh China's really hard and expensive just have a fan do it like this is why you shouldn't do that because all of those things by the way labels do actually say that sometimes just have a fan manage your social media accounts um you actually need to authenticate all these things properly um otherwise they belong to the person who's running and you could find out that your social media account with hundreds of thousands or God willing millions of followers belongs to you know little Timmy and and Jungjo.

SPEAKER_01 34:33

Yeah wow gosh what an eye opener um interesting I guess what about uh what about the kind of uh we mentioned a little bit earlier about the kind of the copyright collection you know the the historical problems that that that kind of the average West including myself that you know just have always struggled to understand um what is copyright law basically still like fundamentally the same um in in China as it is in the West um is it is it just a kind of in an issue with policy enforcement infrastructure because the music industry is so new is that what the problem is uh I think yeah I think yes first of all the law itself if you were to see it written on paper I'm not a lawyer but I think you'd be you'd feel find it was you know similar if not the same um I think you would also find that enforcement of that is patchy sometimes just because it's a really big country.

SPEAKER_00 35:33

And I think also and this is not to defend that enforcement not being correct. It's not like it works great everywhere anyway. Like it doesn't go by for me where there's not claims and stuff being unpaid and XYZ not happening in like every every place in the world. I think the difficulty in China is actually the opacity of the market because many of the apps and things you can't see. And again the kind of underlying fundamental business model of you want to integrate everything into one place versus separate streams. It might mean maybe you're managing someone's career holistically you don't really care as much if you're not collecting on every nickel and dime if that means you can go play a stadium in the 144 cities with a million people. Yeah. So there's a lot of different things that are kind of connected together um you know at once to be honest uh I think that that the collection side of the business in China is like improves year on year. I think especially the DSPs are much better at paying stuff out. And I'm not going to throw anybody

Platforms Costs Verification Future Outlook

SPEAKER_00 36:40

specifically under the bus but if like you're working as an independent label or an independent artist or something and you think your music is doing well in China and you're not getting your money, chances are it's probably something to do with like your distribution company and the deals they've struck with the Chinese DSPs less than the Chinese DSPs sort of you know not paying yeah superb analysis.

SPEAKER_01 37:04

Okay yeah that's very insightful thank you I really appreciate that um Jonathan final question for you um it might be linked to that or it might be something completely different but what changes uh would you like to see uh moving forward in in um let's say in relation to the music industry and the relationships perhaps between sort of the West and China and what that might look like you know perhaps 30 years from now what would you like that to look like um I think that naturally over time you're gonna see an evolution of the business in the quote unquote West that starts to look more like China with more things occurring under one roof um and a business that's kind of more experiential.

SPEAKER_00 37:52

We can go down a long road here if you have the time because I think my own opinion of what's going to happen with the ability of AI LLMs whatever you want to call them to create uh you know disposable music at scale is you're gonna have a bifurcation of what we call music. There's gonna be a big percent of music that's gonna be designed to be streamed mostly in the background as like very quietly a lot of popular music is now anyway. And that's going to continue to happen and accelerate and then you're gonna have this whole other music business that's essentially going to require this more holistic approach to viewing all of these things as being part of the same the same kind of thing. It's gonna be streaming and pub and touring and brand partnerships and all this connectivity having to be you know sort of a holistic approach rather than it being siloed. And as that occurs the Chinese music business will make a lot more sense to everybody. There are changes to in China that I look forward to which is as I said like it's a staggering number there are 144 cities with at least one million people in them in China. I don't know what that number is in the US we can ask uh we can ask our our outsourced uh deity you know uh Claude or OpenAI or something that question but maybe it's 10 in the US or something something like that um maybe it's 20. And so you have this massive base for touring. And that traditionally has been underdeveloped for a couple of reasons. One regulatory pressure it's been typically been very difficult to get shows permitted and then two the infrastructure travel infrastructure and just venues and things like that. Both of those things get easier year on year. So you know you've got previously unfathomable things that have happened in in China like like Kanye fucking West doing shows in China right um and I say obviously he did actually perform there a long time ago um back before his detour into his dark twisted fantasy and then now on the other side of it is been able to perform in there again. And previously if you'd had sort of a journey like that it would have been unthinkable for you to get permitted in China to play. That's something that's increasing and you're gonna see artists now who tour more and more and more places. The traditional thing in China was to play Beijing and Shanghai. You're gonna see Beijing Shanghai Chengdu Chongqing Guangzhou Shenzhen seven eight nine ten city tours um that are going to be developing for artists and that's gonna slowly percolate out the other thing you're gonna see is there are a number of artists quietly um who their biggest market is China um and that is going to become more and more commonplace going forward and that could be people who from the UK they could be from Nashville that could be from Indonesia wherever like we work with a few different people who are like this where something connected for them in China and China has sort of replaced the economic lever that maybe the US would have in the the sort of music business of their dreams. Interesting yeah um you're gonna see more and more of this and people may or may not talk about it more and I'm a dumb failed bass player who works in the music business so I can't talk about geopolitics but like obviously the geopolitical situation is fluid and evolving at the moment and I think that it's you know if I was a European business leader right now I would have more of a Chinese strategy not less of a China strategy. And same thing with ASEAN yeah yeah wow gosh you are so impressive Jonathan honestly man you're amazing you gotta cut that you gotta cut that you gotta you gotta cut the praise we don't like the praise of Midwestern boy we can't do any praise uh yeah I mean I think I think I think it's I think it's really again like I don't think I'm that impressive I think I'm pretty well trained at being a bridge between these different places right like I put in a lot of effort to learn Chinese and what I've what I've done is surround myself with really smart people in China and then it's my job to kind of represent and synthesize their thinking in a way so that like hopefully people can can understand it. Like personally for me no I'm I'm not I'm not impressive. Like what's impressive is actually being able to uh to to make music and to make art and stuff that connects with people.

SPEAKER_01 42:54

Like this stuff kind of in support of it is it's it's uh it's nice and it's good but it's the art that actually matters well that's that's wonderful and that's very very humble but I politely beg to differ I think there's I think we're I I I feel very honored to have spoken to you here today because you you've given me answers here today of things that I've wanted to ask for a long time and no one has ever really given me these answers before um and uh I think that will have a a wider benefit on on the listeners of of this show. So uh thank you so much. I really really appreciate your time.

SPEAKER_00 43:32

Yeah for sure um and obviously it's a big topic and I hope everything was digestible to the degree that like things aren't digestible. I'm relatively anonymous online like I'm somewhat hard to find except for like LinkedIn and our website but if anybody has any questions you can feel free to ask ask them um in those places as well because as I said they're big they're big topics and like each of these little bubbles we talked about you know could be a seminar Oh god, yeah. Not by me. Not by me. Seminar by other people. We may be me translating it. Could God not by me.

SPEAKER_01 44:07

But I really I'm sure they'd be quoting you.

SPEAKER_00 44:14

But I I really appreciate the the time, John Ian. It's always good to talk to anybody who has who has the same name structure that I do. It's a John or a Jonathan or John Ian. It always makes it better for sure.

SPEAKER_01 44:28

Yeah, yeah. We're in a cool club, mate. We're a cool club. Exactly. Absolutely. Thank you so much. I really appreciate it. Wow. What an education lift. Goodness gracious me. Jonathan has shared things today in this interview that I just didn't know. And guys, I'm going to level with you, right? You know, I am uh, you know, as many people call me, right, a leading expert on the music business. But listen, I felt humbled today because there are things that I just didn't know that I learned today, right? And I'm not ashamed to admit that. That there were just things that I didn't know. For example, I remember um well maybe like a year ago, uh having an interview with uh with Geordie from Tonic Music, and he referred to the music industry as the music industries. And he kind of explained why. And I thought, wow, I love that. Yeah, because it's so many different industries all within one, especially when we throw in media, right, which is basically how music makes a lot of its money from the media, right? But to understand from Jonathan that China doesn't work that way, that actually it is one industry where organizations have control over all of the aspects, right? Whether that's you know how the music is licensed, whether that's on the song side, on the recording side, the management side, the live side. I just didn't know that before. And I feel I I hope I don't sound silly to you when I say that I didn't know that before. But isn't it wonderful to learn things like that? Because it just makes you think differently about something. And that ultimately is how we learn, right? We don't learn by being comfortable, do we? We learn by being uncomfortable and being bold enough to be able to say it. So I'm saying to you now, there are things I learned today that I never knew before, but I never need to learn them again, and neither do you, because we now know a little bit more about the Chinese market and how it works, what the infrastructure is like, how artists and labels from other parts of the world work in that territory. I've never ever known anybody like Jonathan Heater before who does what he does in the way that he does it. I've seen many, many, many people, as I said to him in the interview, uh, that have gone out to China and combat smiled and gone, great, we have a really great idea as to how we're going to do it. And then they fail. Um and no one likes to see people fail, right? But to see what he does and how he does it makes him and his agency completely unique in their position, in what they offer. So there you go. I hope that you've learned as much as I have today from listening to Jonathan and to listening to what his agency middle eight is all about. Okay, that's enough from me today. Uh, have a great day, everybody, and may the force be with you.