Internet giants Tencent was compelled by regulators to end restrictive agreements with music copyright holders, adding to expanded enforcement of anti-monopoly model and different principles as Beijing asserts authority over flourishing online industries.
Tencent controls over 80% of “restrictive music library resources” following its 2016 acquisition of China Music Group, the State Administration for Market Regulation said Saturday. It said that enables Tencent to improve terms than contenders get or to restrict the capacity of adversaries to enter the market.
Tencent Holdings Ltd., most popular abroad for its WeChat messaging app, has a booming business empire that includes games, music and video. It is among the world’s 10 most valuable public traded companies, with a stock market worth of $680 billion.
To “reestablish market rivalry,” Tencent should end exclusive music copyright contracts within 30 days, the market regulator said in an explanation. The company is banned from expecting providers to give preferred terms over what contenders get.
Tencent guaranteed on its social media handles to “honestly submit to the choice.”
Regulators are getting more serious about enforcement of anti-monopoly measures, data security, financial and different principles against Tencent, e-commerce giant Alibaba Group and different companies that overwhelm entertainment, retail and different ventures.
The enforcement has harmed the securities market worth of some companies. Shares in ride-hailing service Didi Global Inc., which made its U.S. stock market debut last month, are down 21% after regulators declared a probe of its “network security” and requested the company to update handling of client data.
Regulators have publicly cautioned major companies not to utilize their market predominance to keep out new competitors.
Tencent was hindered by regulators on July 10 from consolidating its game platforms Douyu and Huya because may act as a wedge against new competitors.
On Wednesday, the Chinese internet regulator criticized Tencent, Alibaba, microblog platform Sina Weibo and e-commerce service Xiaohongshu for permitting sexually suggestive stickers or short videos of youngsters to be appropriated on their services.
