There is absolutely no reason for karaoke.
An unbiased person will be able to find only one decent argument FOR having karaoke. "Tha japanese have karaoke. We should too, if it's a translation.". That's a good point, but when you put that into effect, for it to have karaoke AND a translation, you now have 3 lines of text covering a decent portion of the screen (especially widescreen videos). I don't have the picture, but that CHERRY BLOSSOM x6 image from Eureka 7 OP 4 is a good example of how stupid this is. Not to mention, not all anime have their own karaoke when they air.
As for the actual reasons people would want karaoke, those are also stupid. If they want to sing a song, then look up the lyrics on a lyrics site.
I'll admit, I personally don't mind karaoke in OPs and EDs. But what really fucking irritates me is when fansubbers put in 2 fucking lines of subs in the middle of a highly emotional scene. You can't even say "the japanese got karaoke" with this, because they don't. I watched the Clannad Tomoyo OVA today and was watchiong the last scene, really touching. Then ugly animated subs appeared on top of Tomoya and Tomoyo's heads, completely ruining the moment.
To all fansubbers; Nobody wants or needs karaoke. Please stop. If you absolutely fucking insist on using shitty effects just to show how retarded you are, then only do it in the OP and ED (and no, don't do it when they OP and ED are used as insert songs.)