Short video platform Kuaishou is rolling out a vastly expanded music library following an agreement with Tencent Music Entertainment (TME) for one of the largest-scale copyright deals in the short video industry, media outlet 36Kr reported.
Why it matters: Kuaishou and its rival Douyin have been working to expand their libraries of original music, which has been a major draw to short video platform users.
- Douyin reached a music licensing deal with TME near the end of 2019, marking the first major partnership between parent company Bytedance and Tencent.
Details: A selection of songs on Kuaishou that users can select as background music for their videos are labeled “Tencent Music,” but the rollout appears to be in the early stages. Song offerings from official sources remain limited compared with the number of user-uploaded tracks, TechNode has observed.
- Kuaishou and Tencent began negotiating the licensing deal as early as the second half of 2018, according to people familiar with the matter.
- It is unclear when the music-sharing deal was finalized, but the two companies began research and development for music-sharing across their apps in the first half of 2019, according to the report.
- Kuaishou declined to comment when contacted by TechNode on Sunday.
- Currently, a large number of licensed songs from TME is being brought to Kuaishou with the goal of becoming one of the main sources of music on the app.
- The licensing deal also allows Kuaishou’s other apps such as video-sharing website AcFun and video editing tool Kuaiying to access TME’s music library.
- In November 2019, Kuaishou partnered with TME to support and promote independent musicians across TME’s music streaming and karaoke apps, including QQ Music and Kuwo Live.
Context: Despite pouring resources into its own short video app Weishi, Tencent has also been investing heavily in Kuaishou in an attempt to compete with Bytedance-owned Douyin.
- In December 2019, Tencent was reported to be in the final stages of negotiations with Kuaishou for a $2 billion investment in the platform’s $3 billion pre-IPO round of financing. The investment would give Tencent a nearly 20% stake in Kuaishou.
- As the owner of some of the largest music-streaming platforms in China, Tencent has been known for signing exclusive deals with major music labels and passing the costs to smaller competitors such as NetEase Cloud Music.
- Tencent also recently led a consortium to buy 10% of Vivendi’s Universal Group for $3.4 billion, according to a Bloomberg report.