What’s new: The online music arm of internet gaming giant NetEase Inc. has signed a broad new strategic agreement with Bertelsmann Music Group, one of the world’s top five music labels, the pair announced on Monday.
Under the tie-up, the two companies will collaborate in areas including music copyrights, development of music-related intellectual property, musical performances and online karaoke.
What’s the bigger picture: China’s online music scene has become more competitive in the last two years as the major global labels terminated once-exclusive agreements that had given the rights to most of their libraries to the industry giants Tencent Holdings Ltd. and Alibaba Group Holding Ltd.
Bertelsmann had one such agreement with Alibaba, which it terminated last year. Tencent Music also had several exclusive arrangements, which it has also been terminating both for cost reasons and also amid complaints from rivals.
As the exclusive agreements come to an end, smaller players like NetEase have been able to come in and sign their own deals with a wide range of labels.
Related: Tencent, NetEase Tie Up With Universal Music, Rock Records
Contact reporter Yang Ge (geyang@caixin.com)
