SM Entertainment girl group Red Velvet. Photo Credit: TV10
SM Entertainment’s catalog isn’t exiting NetEase Cloud Music after all, as the companies have temporarily extended their existing deal as they continue to negotiate a new licensing pact.
The Chinese streaming service disclosed that “preliminary agreement” in a formal release put out in both English and Korean. By now, most are aware of K-pop’s decidedly global reach, extending well beyond South Korea to a number of international markets.
To be sure, YG Entertainment’s Babymonster, which only put out a debut EP and album in 2024, kicked off its first world tour in Seoul last weekend. All told, however, the concert series is expected to bring the group to the U.S., Japan, Singapore, Hong Kong, Vietnam, Thailand, Indonesia, Malaysia, and Taiwan.
Chief among today’s lucrative K-pop markets is China, which has seen its recorded music sector grow considerably in recent years. SM Entertainment has attracted over 1.5 million “fans” to its main profile on Chinese social service Weibo, for instance – with millions more following signed acts like Aespa and Red Velvet.
And during 2024, NetEase Cloud Music scored partnerships with Kakao Entertainment (including, beyond straight licensing, a 30-day exclusivity window in China for all new projects) and JYP Entertainment.
On top of streaming music, fans can purchase albums via Cloud Music and different China-based platforms; several acts, in K-pop and otherwise, have achieved strong sales through the service.
Meanwhile, Cloud Music has long been battling (in the market and in the courtroom) its Tencent Music rival, which in October 2024 finalized a deal with Seoul K-pop agency Galaxy Corporation.
Then, though the notice received minimal stateside coverage, Cloud Music in November 2024 publicly called on Tencent Music (and specifically QQ) to cease lifting its app features, per Hong Kong’s The Standard.
In other words, losing K-pop giant SM’s catalog would be a big blow to Cloud Music, which last week warned that a licensing renewal appeared unlikely before the existing deal’s January 31st expiration.
At least as described by Cloud Music, this warning prompted “overwhelming support and earnest pleas from fans,” including on the mentioned Weibo. From there, said pleas “played a pivotal role in bringing the two companies to the negotiating table,” according to the publicly traded (HKEX: 9899) business.
As things stand, it’s unclear whether the parties will reach a long-term agreement and, if not, when exactly the temporary extension will end. But Cloud Music did spell out that the arrangement will keep the SM “catalog available to fans past the impending January 31 deadline, allowing for extended negotiations.”
In any event, it’ll be worth closely monitoring the talks (which, if they do produce a fresh deal, will presumably deliver a corresponding announcement) and other K-pop developments in China’s quick-expanding music space.