TOKYO -- The provider of the Line instant messaging app will discontinue its overseas music streaming business MixRadio in the coming weeks due to a lack of profitability, the Japanese company said Tuesday.
Several million people in 31 countries listen to music via smartphone with the MixRadio service. Line Corp. acquired it from U.S. software giant Microsoft in March 2015, intending to add more overseas users by linking music distribution with its communications app.
But MixRadio has faced intense competition from the likes of Spotify, Apple and Google. Line said that after considering operating costs and business priorities, it determined that growth would be difficult and decided to shut down the service.
The company has not specified the loss it will incur from MixRadio's acquisition and liquidation. Employment of MixRadio's workers has yet to be negotiated.
Line will continue to offer Line Music, its music streaming service in Japan and Thailand.
With the MixRadio miscalculation and sluggish growth in the number of U.S. and European users for the Line app, the company will likely be left scrambling to re-evaluate its overseas strategy.