Universal Music Group is starting the year as it means to go on: with a licensing deal to bolster its business in one of the music industry’s ‘high-potential’ markets.
This isn’t a new deal however: it’s an extension of an existing partnership – with Chinese streaming giant Tencent Music Entertainment (TME).
The companies have renewed their “multi-year strategic licensing agreement” covering use of UMG’s catalogue in TME’s three music services: QQ Music, Kugou Music and Kuwo Music.
The deal also includes the Chinese company’s WeSing karaoke service, while the streaming aspects include Dolby Atmos spatial audio and other high-definition formats.
We first reported on UMG and TME’s licensing relationship in 2017, when they announced a deal that included TME sub-licensing UMG’s catalogue to rival streaming services in China.
The sub-licensing model has since been clamped down on by the Chinese authorities, and in 2020 UMG and TME shifted to a more familiar licensing arrangement, while also launching a joint-venture label together.
Another part of the Tencent empire, Tencent Holdings, led a consortium that acquired a 10% stake in UMG that same year, before taking up an option to acquire a further 10% in early 2021.
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