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Tuesday, July 19, 2011
Baidu Launches Licensed Music Service


Baidu, China's largest Internet search provider, announced today that it has signed a landmark agreement for the distribution of digital music with One-Stop China (OSC), a joint venture whose shareholders are three of the leading global record companies: Universal Music, Warner Music, and Sony Music.

OSC shareholders will license to Baidu their catalogues and upcoming new releases, including Chinese songs (in Mandarin and Cantonese) and international tracks, which can be streamed or downloaded from Baidu's servers.

Under the terms of the deal, Baidu will remunerate music content owners on a per-play and per-download basis for all tracks delivered through the Baidu MP3 Search service, as well as Baidu's newly launched social music platform, ting!. The new product offers users the ability to discover and share music and music-related content.

Users will be able to sign up for membership free of charge through the advertising-supported ting! website, ting.baidu.com.

The agreement with Universal Music, Warner Music and Sony Music is ending years of legal wrangling over charges that Baidu abetted piracy.

"Baidu has always striven to provide the best possible experience to our users," said Jennifer Li, Chief Financial Officer of Baidu. "Our partnership with One-Stop China marks an exciting new beginning. I'm confident that Baidu, the Chinese music fans, recording artists, and the record companies alike will all benefit from this win-win partnership," said Ms. Li.

Representatives of OSC today also welcomed the agreement.

Speaking jointly as the shareholders of OSC, Lachie Rutherford, President Warner Music Asia Pacific, Max Hole, COO Universal Music Group International, and Thomas Hesse, President, Global Digital Business, US Sales and Corporate Strategy, Sony Music Entertainment, said: "This deal connects One-Stop's world-class repertoire of licensed music to a massive audience, creating crucial new opportunities for artists. All parties, especially music fans, will benefit from the growth of this type of compelling music service."

The deal is significant for the music studios who have seen little profit in China where piracy is shoaring and pirated movie DVDs and music recordings are sold for under a dollar.

Earlier in the year, Baidu signed an agreement with the Music Copyright Society of China (MCSC) to pay fees to MCSC for every song downloaded using Ting.


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