Warner Music Signs Deal With Tencent To Venture Into China Market News

Warner Music Signs Deal With Tencent To Venture Into China Market

Author's avatar Clout News Desk

Time icon March 23, 2021

Warner Music has signed an agreement with Tencent of China to help it enter the rapidly growing Asian market.

The American label says working with the Chinese giant will help make its artists such as Dua Lipa and Ed Sheeran “impossible to ignore”.

These companies have also introduced a record label for launching new and existing artists together.

What Are Other Labels Doing?

Rivals such as Universal Music and Sony Music also hit similar deals with Tencent as they seek to break into market share of China.

While China boasts about a fifth of the world’s population, it accounted for less than 3% of the $ 20bn (£ 14.4bn) global revenue generated last year by record companies.

However, it is a rapidly growing market due to the proliferation of broadcasting services such as those owned by Tencent and Alibaba which is its peer.

Tencent’s Dominance

Tencent Music Entertainment (TME) is the largest music company in China and owns the country’s top three streaming platforms, QQ Music, KuGou and Kuwo.

Under the agreement, Tencent will protect the copyright of thousands of Warner Music artists, ensuring that their songs reside on its online music platforms.

US music groups have been increasing investment in Asia as they seek to capture new broadcast customers with Smartphones.

Universal Music signed an agreement last month with major K-pop labels to help it enter South Korea.

It also joined Big Hit Entertainment, a South Korean BTS label, to create a new recording label to test and introduce a new k-pop boy band together.

While major American labels are trying to penetrate China and the Asian region, Tencent has been investing billions of dollars in the US music market.

It received a 20% share in Universal Music, a 9% share in Spotify and a 2% share in Warner Music.

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