NetEase Inc.'s music unit said Wednesday that it has sued Tencent Music Entertainment Group for unfair competition, the latest move in a years-long battle between the two music giants over copyright, musicians and users.

Tencent Music Entertainment has long allowed the streaming of songs licensed to Cloud Village Inc., the NetEase unit said in a statement via Weibo, a social-media account. It also said Tencent Music Entertainment had copied the design and features of its app.

Hong Kong-listed Cloud Village, also known as NetEase Cloud Music, urged Tencent Music Entertainment to stop "all behaviors of unfair competition" and rectify its products and businesses, according to the statement.

A Tencent Music Entertainment spokesman called its rival's statement a "staged trick" and said they "believe in the justice of the law" on his personal WeChat account. Tencent Music Entertainment didn't respond to a request for comment.

Revenue of Tencent Holdings Ltd.'s music unit, China's largest online music-streaming company, grew 7.2% to $4.9 billion in 2021. By comparison, revenue at NetEase's music unit surged 43% to $1.1 billion last year. Cloud Village has been posting losses for years and doesn't expect to report profits before 2023, according to its IPO prospectus.

In July, Tencent was fined by China's market regulator on antitrust grounds and forced to give up exclusive music copyright pacts. Before this, it had owned more than 80% of such exclusive rights for streaming in China. Last year, the music unit reported its first annual decline in profit since it went public in 2018.


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(END) Dow Jones Newswires

04-27-22 0546ET