K-pop powerhouse HYBE has signed a music distribution deal with Chinese company Tencent Music Entertainment.
According to reports from The Seoul Economic Daily, the deal will result in HYBE artists being available on Tencent’s streaming platforms, including QQ Music, KuGou Music, KuWo Music and WeSing. The deal reflects the “deep strategic collaboration” announced by Tencent Music last week. As part of the collaboration, HYBE artists will also be advertised on these platforms. K-pop artists like BTS, SEVENTEEN and TXT are very popular in China— but China accounts for just 1% of HYBE sales. Excluding Korea, the Japanese market accounts for 32.7% of business.
The new deal will help HYBE expand its ambitions in the Chinese music market. HYBE has reportedly already started recruiting Chinese staff to set up operations for a stronger local presence. HYBE Chairman Bang Si Hyuk notes that the Chinese market continues to grow despite the challenges faced by the CCP’s “Hallyu Restrictions” on banning Korean media content.
Over 700 million people in China listen to music streaming platforms, with Tencent Music’s umbrella organization serving 90% of that number. Tencent’s online music revenue reached $510 million in the first quarter of 2023, with over 94.4 million paying members.
During the battle to acquire SM, HYBE mentioned that it plans to expand its presence in China. Although that deal fell through, it seems like HYBE is continuing with its expansion plans for China. About half of SEVENTEEN’s recent album sales have come from China (2m out of 4m sales), with many other groups also having the majority of their sales in China.
Seventeen’s 10th EP, FML set a new record for first-week sales of a K-pop album that sold four million copies on the first day alone. That’s the biggest first-week album sale in K-pop history, surpassing BTS’ record set in February 2020 with the release of Map of the Soul: 7.