South Korean messaging app Kakao has acquired a controlling stake in the parent company of local music-streaming service MelOn, spending $1.6bn to acquire 74.6% of Loen Entertainment.
It’s the latest crossover between music and messaging – see Kakao rival Line’s acquisition of MixRadio and separate launch of its own Line Music last year – and in a country where the big Western streaming services have yet to make their mark.
“By combining Kakao’s various platforms and content services and Loen’s leading music content, we expect tremendous synergy that could establish a strong foundation for global expansion,” said Kakao chief executive Jimmy Rim, according to Reuters.
TechCrunch added a few more details: Kakao is planning to “create new services that run across social networks, create music communities across Kakao services and curate ‘smart’ music playlists and selections via user data” as well as expand outside South Korea.
MelOn is the largest streaming service in Korea with 28 million users – in a country where subscription services accounted for 53% of trade revenues last year according to the IFPI.