Earlier this month, we reported on chatter that Tencent Music would not be told to sell one or more of its three music streaming services in China by regulators. Instead, reports predicted a fine, and an order to give up its exclusive deals with music rightsholders. Those predictions were correct. “Tencent Holdings has been ordered to end its exclusive music licensing deals with global record labels within 30 days and has been fined 500,000 yuan (US$77,143) by China’s antitrust authorities,” reported the South China Morning Post.
Tencent Music has also been ordered not to charge large ‘pre-payments’ from rivals for music which it sub-licences, although it can continue to sign exclusive deals with smaller, non-global labels. As we noted in our last story, this is not a disaster for Tencent Music by any means: the global major labels had already shifted from an exclusive strategy in China to one of non-exclusive deals with a range of DSPs. As for the fine, it’s around 0.006% of Tencent Music’s Q1 revenues this year.
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