The Chinese Government Says Streaming Music Exclusives Suck

Streaming music exclusives ultimately harm the music industry, says the Chinese government.

A Chinese regulator has issued a strongly-worded notice to music streamers about signing music exclusives.

Last week, the State Administration of Press, Publication, Radio, Film, and Television (SAPPRFT) posted a warning to Chinese music streamers.  The SAPPRFT sent the notice to Tencent Music Entertainment Group, Ali Music Group, NetEase Cloud Music, and Baidu Taihe Music.  It also warned twenty domestic and international record labels, including Sony Music, UMG, and WMG.

A statement roughly translated from the SAPPRFT website reads,

“The current online music copyright market, there have been some problems, driving up copyright licensing fees, snatching exclusive copyright…unauthorized use of music and other phenomena have rebounded.”

The SAPPRFT also rebuked current market practices.

“This is not conducive to the wide dissemination of musical works… [It also isn’t] conducive to the healthy development of the network music industry.”

Streaming music exclusives and copyrights have become a problem in China.  Pop star Jay Chou, for instance, has remained signed exclusively with Tencent Music.

Three years ago, tensions between rival platforms over music exclusives reached its peak.  NetEase and Tencent filed multiple lawsuits against each other.  Both companies claimed that the other had unauthorized access to their exclusive songs.

Alibaba later sued KuGuo for the same reason.  KuGuo, in turn, countersued.

The bitter feuds prompted the National Copyright Bureau to force major tech companies to sign a copyright protection self-declaration.  To circumvent the agreement, however, online publication Sixth Tone reports that music streamers have since scooped up copyrights “as a source of profit.”

Speaking with the publication, Marco Pearman-Parish, President of Yingke Global law firms and CEO of Corporation China, explained,

“It’s not because [these companies] feel sorry for the artists;  it’s because they want to make money for themselves.”

Philip Grefer, a DJ and owner of Beijing-based record label FakeMusicMedia, told Sixth Tone that exclusive deals in China ultimately hurt artists.

If you’re an artist manager, like we are, you would like to have your music distributed on all the platforms, so it has the widest reach.

Since major labels receive “huge advances” from Chinese companies, said Grefer, without managers to pressure companies, international record labels have few incentives to guarantee that music from small-time artists will get played.

Following the SAPPRFT notice, Tencent and Alibaba announced an agreement to share music rights across both platforms.

Alibaba will be able to stream music from some of Tencent Music’s exclusive deals with major labels.  The move will reportedly increase Tencent Music’s dominance in the Chinese music industry.  It will also severely limit NetEase Music, which remains a distant second.

Li Jun, a tech columnist, told the Financial Times that the Tencent-Alibaba deal will ultimately help Chinese listeners.  Before, users in China would have to pay for multiple subscriptions to listen to their favorite music.  Now, they’ll only have to subscribe either to Tencent or Alibaba to stream their favorite tracks.

Last year, the Chinese music streaming market grew 20%.

This year, analysts project that the market will grow 58.6%.




3 Responses

  1. Anonymous

    Hate to say this on a right wing blog like DMN, but the Chinese government is absolutely right

  2. Faza (TCM)

    Given that exclusives are pretty much the only thing that streaming services can differentiate on (other than price – as long as anyone’s still trying to sell subscriptions), why not just designate the One and be over with it?