China’s music business will grow substantially thanks to the rise of online streaming services, according to Max Hole, head of international business at Universal Music Group, the biggest record company by sales.

For decades, piracy has undermined the ability of rights holders to sell CDs or digital downloads in China. Although China has a fifth of the world’s population, it accounted for less than 1 per cent of record companies’ $15bn in worldwide revenues last year. Labels make more money in New York state than they do in China.

“The Chinese existing model for music is not entirely broken, but it’s pretty broken,” says Mr Hole, who runs Universal’s operations outside the US. “We’ve got the opportunity to skip all that and go straight to a streaming and subscription model.”