Last month, the IFPI labelled China as the next great global opportunity (Global Music Report). Now, Universal Music Group has inked a multi-year licensing agreement with China’s leading digital music platform, Tencent.
Tencent Music Entertainment Group (TME) can now distribute music from UMG’s roster on its streaming platforms, QQ Music, KuGou and Kuwo. The three platforms have an overall user base of 600 million monthly active users and claim more than 15 million paying subscribers.
In addition, TME is now UMG’s master distribution and licensing partner to exclusively sub-license its content to third-party music service providers in China.
What’s more, the two conglomerates are set to erect Abbey Road Studios China which is linked to the iconic London studio, where The Beatles recorded almost all of their records.
Sans Abbey Road Studios China, the agreement is similar to the deals inked by Tencent with Warner and Sony Music, making UMG the last of the majors to team with TME. Crucially though, the deal gives Tencent control of the recorded music repertoire in China from all three majors.
With over 1.63 billion people, China is the globe’s biggest country and second biggest economy. But it has long struggled with digital piracy, and is yet to break into the world’s Top 10 music markets (it ranked 12 in 2016 after a 30% rise in streaming).