Tencent Music Entertainment (TME) has made a ‘strategic investment’ in streaming service Douban FM.
Shenzhen-based Douban announced the news in a statement yesterday (February 20), also naming Yuxin Capital as an investor.
The statement says that Douban FM will ‘cooperate with Tencent Music Entertainment Group in copyright and products’ to facilitate an upgrade to its brand and the launch of a new v.6 version of the platform (pictured).
According to reports by Shanghai-based publication The Paper and sister publication Sixth Tone, Tencent is making an investment in Douban in the form of song copyrights, ‘rather than actual money’, therefore trading its music library for equity.
Citing a person close to the deal, The Paper reports that Douban FM now ‘has almost all the music files of Tencent Music’.
TME is home to three of China’s leading music streaming services; QQ Music, Kugou and Kuwo.
The company started trading on the New York Stock Exchange under the symbol TME on December 12, raising around $1.1bn, having offered 82,000,000 shares at $13.
Last month JPMorgan upgraded TME stock to a ‘buy’ and set a target value of $16/share.
TME’s stock closed at $17.18 a share yesterday (February 20).
Douban FM was launched in 2009 as one of the first music streaming services in China.
It’s parent company, social media platform Douban.com formed the DNV Music Group in April 2018 following the merger of V.Fine Music and Douban Music.
“Content, products, services and teams are very important for music streaming.”
Tang Ziyu, DNV Music Group
DNV Music Group CEO Tang Ziyu said (translated): “Content, products, services and teams are very important for music streaming. Thanks to TME and Yuxin Capital for their very important support in terms of copyright, products and funds.
“After the establishment of DNV Music Group in April last year, the business lines of Douban Music and the various brands of the Group have all opened up resources and realized the linkage of resources.”
Li Quan, DNV Music Group
Li Quan, president of DNV Music Group added (translated): “After the establishment of DNV Music Group in April last year, the business lines of Douban Music and the various brands of the Group have all opened up resources and realized the linkage of resources.
“The important industrial chain layout will eventually create a mature music industry closed-loop [and] quickly form industry barriers, so that music can maximize the value of both B and C markets.”Music Business Worldwide