Cooperation between Tencent and Alibaba within China is rare. But TME and Ali Music both have exclusive rights to music that the other services want to add to their offerings. TME has access to Universal, Warner, and Sony—the world’s top three record companies. It also has the rights for streaming the catalogs of YG Entertainment (South Korea), JVR Music (Taiwan) and LOEN Entertainment (Taiwan). It is granting access to these catalogs to Ali Music—more than a million tracks (in Chinese).
Ali Music is reciprocating with a copyright swap for the back catalogs of Taiwan’s Rock Records, HIM International Music, B’in Music, and Hong Kong’s Media Asia. This access to music from Hong Kong and Taiwan is believed to have been highly coveted by TME.
Users of Ali Music’s Xiami service can now listen to tracks by BIGBANG, Jay Chou and TFBOYS (whose recent concert TME used as a money maker via streaming it through seven of its apps), and TME apps users will be able to get their fix of Mayday and Yoga Lin, previously exclusive to Ali Music. Ali is retaining rights to other music that it is not sharing.
Top music streaming apps in China 2016-2017 (Data source: DCCI; graph by TechNode)
Copyright trading was already happening among the music streaming services. NetEase had been buying copyright access from Tencent until their copyright dispute in August, but the Ali Music and TME deal is more reciprocal.
Both companies are able to enlarge their catalogs via the deal. Ali Music is one of the smaller players in China’s fast-growing music streaming industry, while TME is the largest. Securing access to further music will no doubt help in shoring up the company’s value ahead of an IPO.