(Yicai Global) Feb. 1 -- Tencent Music Entertainment Group and Sony Music Entertainment have launched an electronic dance music brand, Liquid State, in Hong Kong. The move represents Tencent Music's gradual move toward the upstream of music industry, said online news site The Paper.
The pair will set up a joint venture to run the new brand, but the shareholding ratio has not been disclosed, the report said. The new brand will provide original contents by combining recording expertise of Sony Music with Tencent's marketing and digital entertainment services. In addition, WeChat, QQ, Tencent Video, QQ Zone and other Tencent channels will also support the brand.
Tencent Music currently has the world's largest number of internet users, 750 million, in China. The company plans to extend the upstream and downstream of the industry chain by virtue of its strong user base. It aims to expand its business into upstream music publishing and signing up artists through investment as well as partnerships. As a result, it will link users with music content producers more directly, insiders said.
Owning three major platforms, QQMusic, KuGou and Kuwo Music, Tencent Music Entertainment Group occupies half of domestic online music market in China. Some recent media reports suggested that the company will go public in the US stock markets this year. It seeks to raise at least USD1 billion pre-IPO funds, which would bring its valuation to USD10 billion, Bloomberg claimed in a report earlier. However, Tencent did not make any comment on the issue.
Sony attaches great importance to this cooperation, said Denis Handlin AO, chairman and CEO of Sony Music Entertainment's Australia and New Zealand divisions. Tencent hopes to create different cultural exchanges between East and West through electronic dance music, commented Peng Jiaxin, CEO of Tencent Music Entertainment Group. Moreover, Tencent and Sony hope to work out a win-win solution with all involved partners, Peng added.