Tencent Music Entertainment Group is under investigation by China’s competition regulator according to an official posting on Sina Weibo. While the government has not made an official announcement, Weibo postings are often considered de facto declarations of the government’s intentions.
The investigation is reportedly around Tencent Music’s exclusive deals with international majors Universal Music, Sony Music and Warner Music, and whether those deals violate Chinese anti-competition rules.
Tencent signed the deals with all the majors about three years ago but around a year later, the Chinese government forced Tencent to share that content with streaming music service competitors like NetEase Cloud Music. Tencent agreed to sub-license, but reportedly the costs to the sub-licensors are high.