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China antitrust: Tencent Music will have to give up music label exclusivity, sources say
- The penalty is the culmination of an investigation by China’s market regulator, the State Administration of Market Regulation (SAMR)
- On Saturday, SAMR said it would block Tencent’s plan to merge the country’s two largest video game streaming sites
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China’s antitrust regulator is poised to order the music streaming arm of Tencent Holdings to give up exclusive rights to music labels, two people with direct knowledge of the matter said on Monday.
The penalty, plus a 500,000 yuan (US$77,150) fine for misreporting the acquisition of two apps, is the culmination of an investigation by the State Administration of Market Regulation (SAMR) into Tencent Music Entertainment Group, China’s dominant music streaming company, the people told Reuters.
In April, Reuters reported that the regulator was preparing to fine Tencent Holdings as part of a sweeping antitrust clamp-down on the country’s internet giants, with two people saying the company should expect a penalty of at least 10 billion yuan.
The people said at the time that the gaming and social media leader was lobbying for a more lenient penalty.
Reuters could not immediately determine whether Tencent Holdings faces further antitrust penalties beyond the expected ruling on Tencent Music.
SAMR, Tencent Holdings and Tencent Music did not respond to Reuters’ requests for comment on Monday.
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