Tencent Flashes Its Growing Sway Over Asian Music Market

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At the All That Matters conference, the Chinese firm unveiled plans to use AI to curate and create music and signing of R3HAB to Liquid State.

SINGAPORE — Tencent's deepening influence on the Asian music scene was on display here this week, as the Chinese company outlined its evolving strategies to use big data and Artificial intelligence to leverage music subscriptions, music creation and the growth of EDM in the fast-growing region.

The Chinese firm, which is being investigated by China’s competition regulator, made a series of announcements at the All That Matters entertainment and branding conference, an annual event that typically gathers an elite lineup of Asian and international executives, artists and managers. Tencent Music Entertainment Group (TME), a joint venture between Tencent and Spotify, sponsored the music portion of the event.

EDM Gaining New Life in China

Liquid State, a joint venture between Tencent and Sony Music, said at the conference that it had signed R3HAB to an Asian distribution deal. As part of the deal, the Dutch-Moroccan DJ will be releasing new tracks through Liquid State that focus on the Asian market, while licensing his CYB3RPVNK label's music library of more than 190 tracks.

The label, which launched in early 2018, also announced a series of collaborations between Western artists and Asian DJs. Norwegian DJ Alan Walker, who already has released collaborations on Liquid State with Chinese superstar Lay Zhang, is teaming up with Nicholas Tse, a Hong Kong-based actor and rock singer. The artists are currently tweaking the video for the project, Tse said.

The collaboration was not organic, but rather dreamed up by the label. “When we invited Nicolas and Alan to do this collaboration we actually were leveraging Tencent Music Entertainment big data,” said Andy Ng, an executive at TME. The label found that the two artists shared similar “fan spaces” in terms of the demographics of their listeners, he said.

MISO, a promising DJ talent from South Korea from DCTOM entertainment, also is teaming up with the label on new-release projects. He appeared on stage in Singapore wearing a traditional Korean mask, saying he was creating a new DJ persona.

And in a sign of how quickly the label has established new artists, CORSAK, one of the early talents to sign on, was commemorated with a plaque for reaching 1 billion streams on his debut single, “Reverse.” (It peaked at No. 7 on QQ Music’s ‘Hot Chart’ and hit No. 1 on Douyin’s Viral Chart.)

The Shanghai-based producer related to the Singapore audience how he built his own DYI studio, putting thousands of ping pong balls on the floor, walls and rooftop, “so while doing music, my neighbor would not call the police on me.” And in that “dark room,” he created “Reverse,” writing the melody in five minutes; he struggled through the writing of the lyrics himself when a more experienced friend tried to charge more than he could afford.

The moves by the Chinese label come as Asia is becoming the global focus of growth for the EDM industry. Argentina and Brazil, South America’s largest music markets, are coping with severe economic downturns that have chased away many superstar DJs and global festival brands like Ultra and Insomniac. Asian promoters, with a burgeoning middle class of EDM fans to cater to, have had an easier time pulling in the big DJs and festivals.

While the majority of Tencent’s 800 million active daily users are focused on pop music, “we actually saw a very huge demand on EDM for the past two years," Ng said. “You can see that EDM is going to be the next wave in the Chinese market."

Tencent, for its part, is “going to be 100% committed in marketing and promotion to ensure that the EDM Chinese market will be a success in the future,” Ng said.

Tencent CEO Outlines Plans for AI

Cussion Pang, TME's CEO, said the company plans to employ AI to better improve the consumer experience by curating song recommendations, classifying genres and even to predict what songs will be hits.

“We can also figure out which target user group will be more likely to fall in love with the songs,” he said.

Somewhat more ominously, the Tencent chief said that the company’s growing roster of professors, industry experts and scientists are also “thinking of using AI to create the music.” Pang acknowledged that “this is really a sensitive topic, whether AI or robot or machine learning is going to replace humans in the future.”

But, he said, “it will improve the efficiencies. We are pouring in a lot of resources to make sure we are in the front end of using technology to improve the music industry.”

Cussion said that he foresaw an opportunity for Tencent to exploit its considerable intellectual property around video gaming to create a “virtual idol” with original music. He did not elaborate on what form it would take. “Especially when the 5G generation is coming, there are a lot of possibilities that we can even improve the overall performance in that area,” he said.

UMG Makes a Bigger Bet on South East Asia

Also making news this week was Universal, which inaugurated a new office in Singapore that will oversee Southeast Asia for the major. The label announced that hip hop label Def Jam and electronic label Astralwerks would establish hubs in the Singapore office, and that UMG would place assets on the ground in A&R and marketing in Indonesia, Thailand, Malaysia, the Philippines, Singapore and Indochina. UMG also plans to launch six affiliates in Vietnam by the end of the year.

Singapore is fast becoming a regional hub for the entertainment industry. Los Angeles-based AEG announced a few days earlier that it had shifted the focus of its Southeast Asia operations from Shanghai to Singapore. Andy Granite, UMG’s executive vp market development, said the fact that major digital partners like Apple, YouTube and Spotify are also in Singapore was a factor in UMG’s decision to establish the new hub; the Hong Kong office previously oversaw Southeast Asia.

The office openings came on a week when a thick haze descended on Singapore, as the country’s air reached officially unhealthy levels for the first time in three years, reportedly due to massive man-made fires in nearby Sumatra that have become an annual struggle.

Elton John Tour Swells

In one of the conference’s most memorable moments, Adam Wilkes, the CEO of AEG Asia, commented on the growing list of cities where Elton John is confirmed to play in Australia and New Zealand beginning in November. The number of confirmed shows has now reached 40, putting the veteran British singer within spitting distance of P!nk, the standing Australian touring champ.

In addition to arenas in big cities in the two countries, the veteran British singer is also scouring the countryside, hitting wineries and open-air venues, even ones that are koala conservation areas.

“We are playing all of the markets, multiple times,” Wilkes said semi-seriously, looking up at a list of the tour dates displayed on a big screen. “It is like everybody in Australia is going twice.”