Following $43 Million in Losses in 2018, NetEase Cloud Music Partners with Japan’s Nippon Columbia
NetEase Cloud Music has been on the move as of late.
Late last year, and ahead of Tencent Music’s fabled IPO launch, the Chinese streaming music giant had closed an important financing round.
NetEase Cloud Music raised $600 million in funding. Strategic partners included Baidu, General Atlantic, Boyu Capital, and several other unnamed investors.
Following the fundraising announcement, the company confirmed that it would remain the controlling shareholder of its streaming music business.
Two years ago, the company had reached a valuation of $1 billion after raising ¥750 million (around $108 million then) in funding.
In addition to the $600 million in funding, the company confirmed that it had reached over 600 million registered users. Since 2017, the company had added 200 million new users.
Similar to SoundCloud, the company has also aimed at providing a platform for independent musicians in the country. Over 70,000 indie musicians have uploaded over 1.2 million songs to the platform.
Then, last January, and thanks to the massive popularity of K-Pop in China, NetEase unveiled a strategic partnership with South Korea’s Cube Entertainment.
Under the partnership agreement, NetEase Cloud Music now provides users with the entirety of Cube’s catalog. This includes popular artists such as BTOB, CLC, PENTAGON, Yoo Seon-Ho, and (G)I-DLE.
The streaming music giant would also promote its platform as the go-to brand for Chinese fans of Korean music. The company also has existing partnerships with major Korean music award events.
Now, NetEase has unveiled a brand new partnership.
Teaming up with Nippon Columbia.
Earlier this morning, NetEase confirmed a new licensing agreement with Nippon Columbia, Japan’s premier record label.
Under the partnership, the Chinese streaming music giant has gained access to Nippon’s expansive music library. This includes pop music and enka – a popular Japanese music genre resembling traditional Japanese music stylistically. Artists now streaming on NetEase include 04 Limited Sazabys, NakamuraEmi, Aoi Yuki, Miku Itou, and Hibari Misora, among others.
Financial terms of the agreement remain undisclosed. Yet, the strategic partnership comes at a critical time for the Chinese tech company.
According to a separate report, and unlike competitor Tencent Music, NetEase Cloud Music reported a gross loss of ¥326 million ($48 million) last year. The company attributed the loss to higher costs related to licensing music as well as decreased revenue contribution from ‘other online business platforms.’ In 2018, for example, the company shelled out ¥170 million ($25.4 million) just to license 2,000 tracks from Taiwanese label, Huayan.
Speaking about the deal, and staying silent about the company’s losses, Zhu Yiwen, the Chinese streaming music giant’s CEO, said,
“As a music platform adored by Chinese young people, NetEase Cloud Music can leverage its position to actively promote outstanding artists and music works of Nippon Columbia in China.”
Miyomatsu Abe, President of Nippon Columbia, added,
“We’re very happy to work with NetEase Cloud Music to bring Nippon Columbia’s music to listeners in China.”
NetEase remains the first company to partner with the Japanese label in China.
Featured image by NetEase Cloud Music.