Chinese streaming service NetEase Cloud Music is increasingly positioning itself as the place to go for K-pop in China.
Its latest move is a deal with South Korea’s Kakao Entertainment that will give NetEase users exclusive access to music distributed by Kakao for 30 days from the moment of its global release.
Kakao’s music division boasts a library of tens of thousands of tracks from hundreds of artists, among them IU, Jay Park, Kiss of Life, Lee Yong Ji, N.Flying, STAYC, and The BOYZ.
The new exclusivity period began on Thursday (October 24). The companies didn’t disclose how long the exclusivity feature will run.
For Cloud Music, this represents a significant expansion of the licensing deal it signed with Kakao this past May. At the time, the streaming platform said it would “engage in diverse approaches to unlock more opportunities for Kakao Entertainment’s vast and influential catalog as well as its prominent artists to effectively build influence among younger generation users in China.”
It follows numerous licensing deals with other K-pop companies, including SM Entertainment and YG Entertainment in 2022, and JYP Entertainment earlier this year.
It also comes in the wake of a new agreement between Apple Music and China’s dominant wireless carrier, China Mobile, that will give Apple increased access to the Chinese market.
Cloud Music is a major player in China’s music streaming market, though its subscription numbers lag Tencent Music Entertainment, generally considered the market leader, and – by some accounts – China Mobile’s in-house music streaming platform, Migu Music.
In its latest earnings report, for calendar Q2, Cloud Music reported a 26.6% YoY jump in revenues from music services, to RMB 2.6 billion (USD $359.0 million at the average exchange rate for Q2).
In a break with previous practice, the company didn’t reveal paid subscription numbers or monthly active users. In its annual report for 2023, Cloud Music reported 44.1 million paid music subscribers, up 15.3% YoY.
That compares to 106.7 million paying subscribers at Tencent Music Entertainment’s slate of music streaming services at the end of 2023.
For Kakao Entertainment, the deal with Cloud Music represents some badly needed good news in the wake of the arrest and indictment of Kim Beom-su, the founder of parent company Kakao Corp.
Prosecutors alleged that Kim, along with others at Kakao, had conspired to drive up the stock price of SM Entertainment during a 2023 bidding war against K-pop giant HYBE for control of SM.Music Business Worldwide
