Sega has invested an undisclosed sum in Indian mobile music-discovery startup Flutin, as part of efforts to diversify its business into the wider entertainment sector, following the lowering of its financial forecast for 2020 due to poor performance of physical game sales. The funding will purportedly be used by Flutin to expand the platform into international markets such as the US and Japan. According to Flutin CEO Vishu Gupta, “63% of all music revenue in Japan comes from independent artists”, which is likely to explain Sega’s interest in the platform, as it uses AI to track user listening habits and recommend relevant emerging artists according to their music taste.

Explaining the interest in Flutin, Toshihisa Kiyomiya, management department director of investment at Sega, said, “In markets like India and in areas like streaming music and music-based mobile apps, we see a great potential for growth and innovation. Which is why we’re excited to support Flutin as it continues to create value for musicians and music lovers worldwide.”

At close of trading, Sega Sammy Holdings Inc. (TYO: 6460) stock has fallen by 3.76% to JP¥1,613 (£11.23) per share.