Universal Music Group is making a major leap into China, signing a licensing agreement with Tencent Music Entertainment Group that will lead to UMG’s artists being streamed in China. Down the road, they will open Abbey Road Studios China.

Tencent will distribute UMG music on its streaming platforms QQ Music, KuGou and Kuwo, as well as serve as UMG’s master distribution and licensing partner to exclusively sub-license UMG’s content to third-party music service providers in China. In addition to working together to find new ways to develop artists, innovate business models and reinforce a robust copyright protection environment, TME will support UMG artists to promote their music, leveraging Tencent online properties and other media channels.

TME’s library already has 17m songs and 600m monthly users, 15m of which are paying subscribers.

To accelerate the development of Chinese recording, UMG and TME will work together to design, build and develop Abbey Road Studios China, a state-of-the-art recording and mastering facility inspired by UMG’s recording studio in London.

“With more than 80 years of history in China, UMG has been engaged in the unique evolution of the country’s music business and I’m looking forward to working with Tencent to bring exciting new artists and services to music fans across China,” UMG Chairman/CEO Sir Lucian Grainge said. “Given recent developments in technology and the commercial environment there, now is the right time for an innovative strategic partnership with a leading Chinese company like Tencent that can meaningfully accelerate the development of the country’s entire music ecosystem and, in turn, inspire growth in creative and commercial opportunities for all artists.”

Cussion Pang, CEO of TME, said, “This strategic agreement will further strengthen our efforts in copyright protection and shift the industry toward the paid subscription model.”