At a guess:

1) Perhaps they don’t want to trigger a different licensing model (on either the music or the lyrics) that applies specifically to karaoke devices and venues. Just a guess, not a music lawyer, but all sorts of unexpected terms apply to music licensing (such as streaming TV services not being able to use music from the original TV broadcast) 2) Perhaps they don’t want to associate with the karaoke “brand” which some users might perceive as kitschy or low-quality (have you ever seen a karaoke video?)

When I hear karaoke I think 90s looking machine with a tethered microphone, or equally old music videos with ugly subtitles. True or not, it is possible they just want to have full control of the image of their service.

Another thing is that when you sing a foreign song, the karaoke also means to read the foreign subtitles in your own language. It's an extra meaning they might want to avoid, I assume this is not a feature they have.

Perhaps it implies use in a commercial karaoke bar setting which often are dubious for licensing music.

It also might imply perfect vocal removal, which they aren’t guaranteeing.

Obvious. Make this look like a more original feature. Redefine the concept on Apple's terms. Have people pay attention to the novelty of it being done automatically, rather than manually in a catalog with lyrics that look like they belong on a CRT screen.

Potentially trademark issues?

Probably because Apple doesn't want it advertising to look like:

"Hey we just added a cultural pastime as a feature!"

There are some that could twist this feature into "Apple profiting off of cultural appropriation".