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NetEase Cloud Music

NetEase Cloud Music sues Tencent Music for unfair competitions and copyright infringement

Aron Chen

posted on April 27, 2022 5:27 pm

NetEase’s Cloud Music unit is suing Tencent Music Entertainment (TME) for unfair competition, accusing it of copyright infringement in its music streaming platforms including QQ Music, Kugou Music, and Kuwo Music.

NetEase Cloud Music said in a Wednesday announcement that the music streaming platforms of TME disseminated the music which it owns exclusive rights without permission.

“We asked QQ music to immediately stop providing playing and downloading services on the popular songs which we owned exclusive rights, but it only removed the songs from its platforms for users in big cities including Beijing, Shanghai and Guangzhou, and continued infringement of the copyrights in areas where we paid much less attention and detection,” NetEase Cloud Music said in a statement.

NetEase Cloud Music’s prosecution of TME involved a large number of popular songs such as The Beauty of the World is Intertwined with You” (Bai Song), “People Like Me” (Mao Buyi) , “Good Night” (Yan Renzhong).

“The streaming music platforms of TME also intentionally market singers who plagiarized our original songs by creating highly similar versions. Since 2020 alone, Tencent Music has successively launched a large number of fake songs of the same name for our popular songs, of which the chorus part of nearly a thousand songs is the same or similar to the original song.” NetEase Cloud Music added.

NetEase Cloud Music alleged that TME also invests in related companies to follow-up and mass-produce popular songs, and give traffic bias to deepen the vicious plagiarism of the industry and boost the scale of the song-washing industry.

NetEase Cloud Music also alleged that TME’s music streaming platforms including QQ Music, Kugou Music, Kuwo Music copied its product innovations including app and page designs, features for a long time.

“TME infringed copyright, seriously violates business ethics, integrity principles and industry standards. We urge TME to immediately rectify its products and businesses and stop all behaviors of unfair competition.” NetEase Cloud Music said.

In September 2021, Tencent Music Entertainment (TME) terminated all exclusive licensing deals with copyright holders in accordance with a recent government mandate, removing a major obstacle for rivals in the entertainment industry.

The move came two months after China’s antitrust watchdog, the State Administration for Market Regulation (SAMR), ordered Tencent to give up exclusive music licensing deals with music labels within 30 days. The reason of this is that Tencent held more than 80% of exclusive music resources that enable it to restrict new rivals from entering the sector.

NetEase, Tencent’s biggest rival in music streaming, said it really appreciate the regulator’s decision to end exclusive music licensing.

"Major online music operator scramble for exclusive music rights, which has pushed up the content costs to insanely high levels. We have been overpaying the content cost twice, even three times than licensing music directly from label companies. This is such an unfair practice. The antitrust policy sent a very exciting signal to the entire industry,” NetEase chief executive William Ding said in a statement.

Following the removal of exclusive music licensing deals,  rivals like Kuaishou Technology, China’s second-largest short video platform, had inked a new licensing deal with Warner Music Group, enabling it to play music clip of Sony’s popular artists like Ed Sheeran and Coldplay on its short video apps such as Kuaishou, and overseas product Kwai and Snackvideo