The payment model is a trend in the long term, but it will take some time for it to become popular, said Wang Lei, senior director of Internet firm NetEase’s cloud music service.

    CHINESE Internet users were warned last weekend to prepare for the end of free online music, and that end arrived Wednesday.

    Since Wednesday, websites such as Baidu music, QQ music, Xiami, Kugou, Duomi and Kuwo have begun charging users for downloads and for listening to high-quality music files online, and all music services will have fees within two months, Wang Xiaowei, chief operating officer of music website xiami.com, was quoted as saying by Hangzhou-based newspaper Daily Business.

    Wang said the websites will charge users either by the number of songs downloaded or listened to or by month, with the latter method likely to be more common.

    Media reports late in 2012 said record companies had started working with major music websites on development of a fee-paying business model.

    But Shenzhen-based Tencent, the owner of QQ music, told Chinese media Monday that the company had no immediate plans to launch compulsory payment for all its music services. Instead, it said, it would continue to provide a combination of free online listening services and its premium monthly payment model.

    Kugou’s marketing manager, Zhang Weiqing, also said Monday he was unaware of any impending switch to fee-based models.

    Baidu refused to comment on the news, but the search engine launched its new music player Thursday, saying “every function of the player is free.”

    After hearing the news, many users said they would hurry to download as much free music as possible before the payment model began.

    There were 575 enterprises in China offering online music by the end of 2012, up 27.2 percent from 2011, and online music revenue in 2012 totaled 4.54 billion yuan (US$740.47 million), up from 2.78 billion yuan in 2011, according to the 2012 China Digital Music Market Annual Report, released by the Ministry of Culture in April.

    Even if only 10 percent of the country’s nearly 800 million Internet users pay for music services, the market is expected to see tens of billions of yuan in additional profit, said Zhang Yi, CEO of Shenzhen-based Internet research company iiMedia Research.

    Some companies began offering pay options years ago. Tencent’s QQ Music users were offered premium “green-diamond” services in 2007, allowing them to pay a monthly fee of 10 yuan for services such as downloading high-quality audio files.

    Xiami charges 0.8 yuan to download a song or 15 yuan for a monthly package with a maximum download of 100 songs.

    Kugou, Duomi and Douban have also launched VIP membership services and monthly packages, charging 10 yuan each month.

    The payment model is a trend in the long term, but it will take some time for it to become popular, said Wang Lei, senior director of Internet firm NetEase’s cloud music service.

    If an industry payment model is carried out before the problem of piracy is eradicated, more users will turn to pirated music websites, and music websites based on payment models will suffer, Wang said, noting that NetEase will continue to provide free music services for now.

    A report by iiMedia in February showed that domestic users are accustomed to free music and only 6 percent of them are willing to pay.

    More than 90 percent of the total revenue of China’s digital music sector is earned by telecom operators, by providing music and ringtone download services, an Analysys report said in March. Record companies only earn 2 to 3 percent and music websites earn the rest, the report said.

    Data from the China Audio & Video Association (CAVA) shows that in South Korea and Japan, record firms get 90 percent of the music revenue, with a figure of 70 percent in the West, offering an indication of why domestic firms are so eager to implement payment models.

    Music websites need to pay tens of millions of yuan to buy legal music each year. For example, Tencent pays 30 million yuan annually for music copyrights and Baidu pays 40 million yuan each year, the Economic Observer newspaper reported in November, citing data from CAVA.

    Due to the huge copyright expenses, most music service providers are still struggling to make any money. (SD-Agencies)