Tencent's music streaming arm Tencent Music will give up music labels exclusivity. A report from Reuters said that China's antitrust regulator the State Administration of Market Regulation (SAMR) is set to order Tencent Music to give up exclusive rights to music labels, which is the tool for the tech giant to compete with smaller competitors. The SAMR will reportedly also fine the company RMB 500,000 (US$ 77,212) for the delay in reporting the acquisitions of apps music streaming platforms Kuwo and Kugou.
The penalty is a much milder one than previous reports as Tencent previously faced a penalty of more than RMB 10 billion (US$1.55 billion) in April, according to the Hong Kong Economic Times. Tencent then lobbied for leniency while the SAMR had told Tencent Music that it may have to sell Kuwo and Kugou.
Reuters said this move was the latest in a series of actions to curb the economic and social power of Chinese internet giants. A number of tech giants were fined over the past few months, including a record RMB 18.2 billion fine Alibaba for abusing its market position.
The regulator said in a statement that since 2015, the Group "has abused its dominant position in the market" and imposed a "Choose one out of two" requirement for its merchants. It also claimed that this has prohibited Alibaba's merchants from opening stores or participating in promotional activities on other rival platforms.
Meanwhile, according to another report from Reuters, Huya, which Tencent holds the biggest share of 36.9%, said on Monday that it had terminated a US$5.3 billion deal with Douyu, which Tencent also owns over a third of its shares. The decision came after just two days as SAMR said it would block the deal on antitrust grounds last Saturday. Last year, Tencent announced plans to merge Huya and DouYu to streamline its stakes in the firms, which were estimated by data firm MobTech to have an 80% share in a market worth more than US$3 billion.
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