Market Structure of Music Apps in China: Group Discussion Week2

Group members:
ZHANG, Wen 1155082015
LYU, Xiaolin 1155081812
WANG, Yiqi 1155081724
XU, Xin 1155089254
Que Yuen Ying, Deborah 1155082157
Wong Cheuk Yi, Jessica 1155087519

The market for mobile music apps in China is oligopoly.

The five characteristics help identify the type of market structure are:

• Concentration of the market
• The market of music apps in China is very concentrated, because the four big compani take up 83.45% market share, the biggest 8 companies take up 96.33% market share.



• Differentiation among products 

• The 4 big companies cooperate with different record companies, QQ music has more resources than others.
• Different user interfaces.
• Some sightly different functions.
• Different monthly fees for VIP users.
• Barriers to entry for new competitors 
• Barriers are high for new competitors because copyright royalties are high.
• Cost structures 
• Fixed costs:  copyright royalties
• Variable costs: R&D fees, operation fees.
• Vertical integration 
• Some companies may sell their own by-products; they may also train singers of their own.