* MOG now has 500,000 active users - CEO
* 5,000 new users from Facebook trying MOG everyday - CEO
* MOG has had sales talks in the past, not yet profitable - CEO
Feb 28 (Reuters) - Digital music start-up MOG isn't actively trying to sell itself, its chief executive said on Tuesday, responding to a report that said his company is struggling in the competitive music subscription business.
MOG now has more than 500,000 active users, according to CEO David Hyman, but he did not break out how many are fully paid-up subscribers. Since integrating the music service into Facebook last fall, nearly 5,000 new users a day have tried out the site he said.
CNET earlier on Tuesday reported that MOG was struggling and is up for sale.
Hyman disputed the idea the company is struggling. But said that as a venture-backed company, MOG has had conversations in the past with potential buyers but he declined to clarify if those conversations had taken place recently.
"We're not actively trying to sell this business, said Hyman. "The Facebook integration has been fantastic for us but as we're not yet profitable we're always engaged in conversations with our shareholders about all possible options."
MOG was founded in 2005 by Hyman, and has raised $33 million from its two main backers Menlo Ventures and Balderton Capital.
The business is only 50 percent online subscriptions, the other half of the business is its advertising network call MOG Music Network, which places advertisements on more than 1,700 music sites. According to comScore data, the MOG network receives more than 60 million unique visitors a month.
Hyman said the company is currently hiring across its team for engineers, marketing and sales staff and has not laid off any staffers since 2009, which was due to the financial crisis.
MOG is in a very competitive market alongside better known names Rhapsody and Spotify. These companies are trying to convince music lovers to change habits of a lifetime and subscribe for unlimited access to on-demand songs and albums streamed over the Web to a user's PC or mobile phone, rather than buying downloads or physical CDs.
Typically these subscription services charge around $10 a month for access to millions of songs on both a user's PC and phone.
Rhapsody, which has been around for more than a decade has just over 1 million U.S. paying subscribers after it bought out Napster. Spotify, which has been very successful at raising its profile since it launched in the U.S. last summer, had garnered some 250,000 paying U.S. subscribers as of October, sources told Reuters.
The relatively slow take-up of paid subscriptions has been disappointing for music labels who have struggled since the advent of digital music.
The labels had been hoping the services would be more successful at simultaneously beating back piracy and shrinking the dominance of Apple Inc's iTunes Music Store. ITunes accounts for some 70 percent music sales in the U.S.