Chinese internet giant Tencent Holdings is making another major investment in the Indian online entertainment sector, with a US$115 million stake in music streaming app Gaana.
Gaana was launched launched in 2011 by Times Media, whose holdings include the Times of India newspaper and tech incubator Times Internet. Times Internet is an existing, controlling shareholder in Gaana and is a co-investor in the new deal. Tencent will acquires a minority stake in Gaana, according to an announcement by the Indian company.
In a recent tweet, Gaana said it has 50 million listeners. In a statement, Prashan Agarwal, Gaana’s chief executive officer, said he believes Indian music services like Gaana have so far reached only 10% of their potential size and could reach a market of 500 million users in Indians.
The company said it plans to use this new funds to develop artificial intelligence to create more personalized services and features for listeners. It said also it will also develop its paid-user service.
“We are happy to welcome Tencent as a partner to Gaana and benefit from their global learnings," said Gautam Sinha, chief executive officer of Times Internet in a statement. "Tencent operates the largest music streaming business in China, and we look forward to working closely with them to continue to innovate and drive the digital music market in India.”
“As more affordable mobile data plans are driving smartphone penetration in India, we believe growth in the music streaming market will accelerate," said Martin Lau, president of Tencent Holdings. "By investing in and collaborating with Gaana, we look forward to bringing more innovation and better experiences to all Indian music lovers.”
Tencent’s other major Indian investments include leading a US$1.1 billion round in ride sharing company Ola, a US$1.4 billion investment in Flipkart, India’s leading e-commerce platform last year, and a US$175 million series D round in messaging app Hike in 2016. It has also been reported to be in talks to invest US$35 to US$40 million in Indian news aggregator Newsdog.
Last week, Tencent’s Chinese rival Alibaba was reported to be in talks to buy a minority stake Dailyhunt, an Indian news aggregator and e-bookstore backed by Chinese personal news recommendation app Toutiao. Alibaba’s other key investments in India include its affiliate Ant Financial’s US$200 investment in food delivery firm Zomato earlier this year. Ant Financial also increased its stakes in online marketplace Paytm Mall to 62% for US$177 million last year.