"Due to operational adjustments, we will stop the
service of Xiami Music," the online music arm of the Chinese e-commerce
giant said on Tuesday on its Weibo account, adding that the closure will occur
on February 5.
"It's hard to say goodbye after being with you for 12
years."
Alibaba acquired the music service in 2013, and invested
millions of yuan to compete in China's online music market, which is dominated
by Tencent. Its efforts however have not paid off and the app currently only
has 2 percent of China's music streaming market, behind KuGou Music, QQ Music,
KuWo, and NetEase Cloud Music, according to Beijing-headquartered data
intelligence company TalkingData.
Xiami's closure also comes after Chinese regulators
announced that they had launched an antitrust investigation into Alibaba, which
beyond its core e-commerce business also operates in sectors such as financial
services, cloud computing and artificial intelligence.
However, it does not mark the end to Alibaba's participation
in the online streaming market. In September 2019, Alibaba invested $700
million in one of Xiami's competitors, NetEase Cloud Music.
-Reuters
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