Indie licensing agency Merlin has announced agreements with the three biggest music-streaming service owners in China: Tencent, NetEase and Alibaba.

The deals will see the catalogue represented by Merlin – music from more than 20,000 independent labels and distributors – made available on Chinese streaming services including NetEase Cloud Music, Xiami, QQ Music, Kugou and Kuwo.

The important point here is that these deals are non-exclusive. They buck the existing trend for western music companies to sign a single, exclusive deal with one of these companies. For example Universal Music’s Tencent partnership in May 2017, or Cooking Vinyl’s Alibaba deal in August.

Merlin will certainly have fielded offers to strike a similarly-exclusive deal with one of the three Chinese companies, who would then have likely sub-licensed its catalogue to the others. Tencent and Alibaba announced such an arrangement in September 2017, for example.

Merlin is taking a different approach by licensing directly with all three, which it says will make its independent-label members’ music available to around 500 million Chinese music listeners – 90% of the digital-music audience there.

(Another interesting point: the fact that the deal will see the streaming services “offering high-fidelity repertoire to paying service subscribers, and delivering low-fidelity versions to users of free-to-access ad-supported tiers”.)

Merlin worked with consultancy Outdustry on the deals, with the latter set to manage the partnerships from its Beijing and Shanghai offices.

“This is an exciting new chapter for Merlin. For the first time, repertoire from the world’s leading independent record labels will be legitimately available across China’s five most prominent music services,” said Merlin CEO Charles Caldas in a statement.

“I am delighted that NetEase Cloud Music, Ali Music Group and Tencent Music Entertainment share Merlin’s confidence and aspirations to develop a new market narrative, and to lay the foundations and infrastructures of a more open, transparent and equitable future.”

China is currently one of the most exciting emerging markets for the recorded-music industry. According to global body the IFPI, in 2016 it was the ninth-biggest digital music market in the world, generating $194.6m of revenues from downloads and streaming.

All indications are that this grew rapidly in 2017, and is set to do so again in 2018. Tencent’s music boss Andy Ng said in June 2017 that its QQ Music, Kugou and Kuwo services had 600 million monthly active users, 200 million daily active users, and 15 million paying subscribers.

QQ Music alone has since grown to 800 million users according to Tencent, with its music division set to go public with an estimated $10bn valuation. Tencent Music also recently swapped shares with Spotify, which is preparing for its own public listing on 3 April.

Meanwhile, NetEase recently announced that its NetEase Cloud Music service has 400 million active users, up 44% year-on-year. Western music accounts for more than 30% of usage on its service.

“This is a significant step forward for music licensing in China – we are pleased to be working with Merlin as it leads the independent music community to better nav-igate, promote and monetise their music in China,” said NetEase’s VP international Mathew Daniel.

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