Apple's Purchase of Online Music Streaming Service Lala to Take iTunes to the Clouds?

The Wall Street Journal is weighing in on Apple's purchase of online streaming music service, Lala, saying Apple is using it to explore taking iTunes to the cloud: lets users buy and listen to music through a Web browser, meaning its customers can access purchases from anywhere, as long as they are connected to the Internet. Apple is considering adopting that same model for songs sold on iTunes, a change that would give consumers more ways to access and manage their iTunes purchases—and wouldn't require them to download Apple's software or their purchases.

According to the WSJ, Apple paid $85 million for Lala, and that the big brains behind the service would be given "very significant roles" inside Apple.

Even before the acquisition closed Friday, Lala Chairman Bill Nguyen and Eddy Cue, Apple's vice president for Internet services, began making joint calls to various business partners, including record-label groups, discussing possibilities for the music service's future.

Big Media is said to be cautiously optimistic about the concept, "optimistic" about web-based purchases, but "cautious" about adding to iTunes already dominant position in online music. And, of course, with plans still in the early stages, much could change before Steve Jobs or Phil Schiller put sneaker to stage and announce a customer facing solution.

While anywhere, anytime access sounds appealing, they also point out that past services have had problems negotiating "virtual goods", such as Amazon pulling books from users' Kindles, and we'd add Microsoft's DRM services shutting down and placing access to user-purchased content in doubt. There's still that Google partnership to navigate as well.

All in all, however, if iTunes goes cloud, as long as we still have the ability to buy and download music as well if we so choose, TiPb thinks it will be a net gain. (No pun intended). What do you think?

Have something to say about this story? Leave a comment! Need help with something else? Ask in our forums!

Rene Ritchie

EiC of iMore, EP of Mobile Nations, Apple analyst, co-host of Debug, Iterate, Vector, Review, and MacBreak Weekly podcasts. Cook, grappler, photon wrangler. Follow him on Twitter and Google+.

More Posts



← Previously

Apple Hiring Video Game Artist for iPhone Gaming Group!

Next up →

Draw: Shareable, Playable, Tweet-able Sketchpad for iPhone

Reader comments

Apple's Purchase of Online Music Streaming Service Lala to Take iTunes to the Clouds?


so, Apple had to buy another service to do this?
The Zune Pass has allowed me to listen to everything on the Zune Marketplace through any browser for months...

What happens when we go off a network or have slow Edge service? Is it entirely network reliant?

I am bumbed cause I was waiting for the lala app. I use the service and it is really nice. With Apple buying them. I am beginning to wonder if we will see the lala app at all.. sob

Apple bought Lala for a lot of reasons, not just to stream music from the cloud. Apple has a lot of cash from selling iPhones now, so they can make strategic purchases as it works on its iPhone content. There's no reason they would have employees prior to this point who are familiar with cloud based music distribution services. Also, the Lala crew has contacts in the music industry who helped them sign the deals behind Lala's services.
These deals don't extend to Apple just because they purchased Lala. That's why phone calls are being made to those contacts in the music industry to bring similar services to Apple. At the same time, they are being rightfully "cautious," given the past history between Apple and the recording industry. It's one thing to allow one start-up to try out a novel business model for selling and distributing music content for a limited period of time, in order to see whether it proves to be a good idea. It's quite another to add to the existing services of the iTunes Store. Every record company conglomerate will now have to make their own calculations to see if Lala's business model and services extended to an enormous entity like the iTunes Store is going to be advantageous for them.
The main advantage of Lala to Apple is that it allows the iTunes Store to exist outside of the world of computers and Apple products, so to speak. In order to justify buying songs from the iTunes store now, you need a computer running iTunes (OSX or Windows, but not Linux), or an iPhone/iPod Touch that can purchase songs from the iTunes Store directly (and then back-up the songs on a computer running iTunes). Because the iTunes Store library is not 100% DRM free, another portable mp3 player won't always work. AAC support is not universal, in part because the main source of AAC files has been the iTunes Store and has some DRM in it already. All of these facts have represented a big obstacle to expanding the reach of the iTunes Store.
The upshot is that the iTunes Store could become a source of music content for every smartphone, MID, HTPC, or computer that can stream music from the web and/or run a specialized application for that purpose.

Yeah but did LaLa have their service synced with Google they way it is now before Apple purchased them? it's a genius idea and changes the way the world looks up music now.