BEIJING / SHANGHAI (Reuters) – Alibaba Group will shut down its music streaming platform Xiami Music next month, a move that marks a step backwards from its ambitions to enter China’s entertainment industry.
“Due to operational adjustments, we will be shutting down the service of Xiami Music,” the online music arm of the Chinese e-commerce giant said on its Weibo account on Tuesday, adding that the shutdown would come 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 with the Chinese online music market, dominated by Tencent Holdings. Its efforts have not borne fruit, however, and the app currently holds just 2% of the Chinese music streaming market, behind KuGou Music, QQ Music, KuWo and NetEase Cloud Music, according to data intelligence firm TalkingData, based. in Beijing.
Xiami’s shutdown also comes after Chinese regulators announced they had launched an antitrust investigation into Alibaba, which, beyond its core e-commerce business, also operates in industries such as financial services, cloud computing and artificial intelligence.
However, that does not mark the end of Alibaba’s involvement in the online streaming market. In September 2019, Alibaba invested $ 700 million in one of Xiami’s competitors, NetEase Cloud Music.
Report by Sophie Yu in Beijing and Brenda Goh in Shanghai; Editing by Michael Perry