(Yicai  Global) Feb. 20 -- Tencent Holdings' music unit has made a strategic  investment in Douban FM, the streaming service under music-based social  media network Douban. 

Tencent  Music Entertainment Group will work with Douban FM on copyrights and  products, the Shenzhen-based firm said in a statement, adding that there  are plans for a new version of the streaming service. 

The  upgrade will bring in Tencent Music's vast song archives but keep  popular existing functions such as a favorites playlist for users, said  Cui Jiayang, head of Douban FM's streaming division, adding that it will  also explore a paid-subscription service.

"The  homogenization seen in the current domestic music platforms has become  widespread," he said. "Douban FM hopes to do better in terms of  algorithms and use the value of its song archives obtained to the  maximum level while bringing users to the music they like more quickly."

The  two companies have not yet disclosed the investment amount, the  specific new equity structure or other details. Tencent Music used music  copyrights rather than cash for the deal, which makes it Douban FM's  second-largest stakeholder.

Despite  being an early entrant in China's online streaming sector in 2009,  Douban FM has struggled to keep pace with rivals in terms of the number  of users and copyrights held, especially since Tencent and fellow tech  heavyweight Alibaba Group Holding entered the market. Douban FM's parent  firm restructured the service and merged it with copyright  authorization platform V. Fine Music before establishing DNV Music Group  last April. The firm acts as Douban FM's largest shareholder.

Listed  in New York in December, Tencent Music boasts more than 200 copyright  partners including the big three US labels Universal Music Group, Sony  Music Entertainment and Warner Music Group. The music service provider  also holds over 20 million genuine copyrights for songs and owns three  music streamers, namely, QQ Music, Kugou and Kuwo.

Editor: William Clegg