Warner music group_Tencent China

The Warner Music Group has struck a distribution deal with Chinese Internet giant Tencent.

US record label Warner Music has signed a first-of-its-kind deal for distributing new releases from its artists with China’s Tencent on November 13, 2014. As part of the agreement, Tencent will manage and promote Warner records in Mainland China through its own QQ Music-streaming service, apart from other legal digital outlets in the country.

Warner music group_Tencent China

The global label has artists such as Bruno Mars, Prince, Michael Buble and Coldplay, under its wings. The deal is a huge step and a first for one of the three international labels in China, in a market where piracy is largely responsible for loss in revenues from artists to software.

Earlier this year, Warner Music had bought Hong Kong-based Gold Typhoon, which has a portfolio of local artists, as well as international Japanese girls group sensation AKB48. At present, Warner Music China represents both Chinese and Western artists.

China’s digital music market is estimated to be only $70 million in 2014. The 2013 music sales in the country could only gather a revenue of $82.6 million, which is a fraction of the $4.47 billion in the US, mostly owing to the culture of piracy.

Considered as the Chinese Google, Tencent has a huge search and social media footprint. The deal with Warner Music will allow the company to root itself deeper into music, bifurcating it from its core businesses of online games and heavily used messaging applications (WeChat).

Warner, Sony and Universal are the only three global labels in China that garnered their presence in the country in 2011 when they signed a deal with Chinese search engine Baidu to start licensing MP3 sound clips.

Photo Credits: rt.com


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