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Business News Deals Digital Top Stories
Tencent further expands music interests, invests in Indian streaming firm
By Chris Cooke | Published on Wednesday 28 February 2018
Chinese web giant Tencent has bought into Indian streaming service Gaana, which was set up in 2010 by the internet business of media firm The Times Of India Group. It further expands Tencent’s interests in the global streaming music market.
Tencent has become a dominant player in the rapidly expanding Chinese digital music domain. Through its music division – which is set to be spun off as a standalone company later this year – it operates streaming services, including QQ Music, and has become a key distributor of international catalogue in the Chinese market.
Last year it announced an equity swap with the global market-leader in subscription streaming, Spotify. Under that deal Spotify took a minority stake in the Tencent Music business, while Tencent and Tencent Music both took a minority stake in Spotify.
The new deal sees Tencent make what sources have called a “sizeable investment” into Gaana, although Times Internet remains a partner in the business. Like China, India is seen as a key emerging market for streaming music, mainly because of the size of its population. There has been substantial growth in subscriber numbers in both countries in recent years, albeit more for ad-funded services.
However, as with everywhere, streaming remains a tricky and mainly loss-making business. Presumably, given its investments in this space, Tencent reckons that long-term the big streaming services will ultimately become lucrative once they reach sufficient scale.
