Well I've only ever seen people play Singstar at parties so I'm not too sure, I guess you could turn down the volume of the lyrics so it's a
real Karaoke. My point was that people usually have the lyrics from the track playing so loudly you can't even hear them singing, where Karaoke is supposed to mean "empty orchestra", you know as in you don't have the original artist singing in the back. Or since it's about scoring points (most Karaoke joints have that yeah, but you're supposed to have fun singing not trying to break highscores
), you could cheat Singstar -like the DS- by just blowing instead of singing.
Probably it's an example of the people just "doing it wrong".
Of course a disc release also has the problem of limited songs, with online services that doesn't fly anymore, and as you said Sony would probably license themselves into limbo, especially since companies like Joysound already distribute Karaoke on any device you can think of. No Singstar in Japan puzzles anyone, but they're probably right in that it never was worth the effort.