• $0.10 Songs Coming to iTunes? Apple to Aquire Lala

    It appears that the folks over at Bloomberg are reporting that Apple is "in talks to acquire online music service Lala, according to two people familiar with the matter." Lala, along with MySpace, power a full-song streaming service that uses Google's new music search, and is also part of the Facebook gift shop. If the supposed acquisition actually happens, it will play a big role in Apple moving towards the digital 'Cloud' strategy. This would be a giant step forward for iTunes since it first launched it's music service.

    So why would songs be cheaper? Well, the folks over at Lala already have all the streaming licenses in place with major music companies and use a different technique to deliver audio to it's users. Lala's service will let customers listen to any song once, for free. For $0.10 the customer can then have access to the song and listen to it from anywhere on the internet. Unlike iTunes, which downloads the songs to a users hard drive, Lala's downloads are stored on servers on whats called 'cloud computing'. If a customer decides to download a track to their harddrive, the cost is $0.79 cents. iTunes prices vary from $0.99 cents to $1.29.

    Lala would be at least the third digital music startup acquired since August. MySpace acquired ILike in August and Imeem last month. Apple Inc., maker of the iPod player and iTunes music software, is in talks to acquire online music service Lala, according to two people familiar with the matter.

    The terms of the deal weren’t known. The people declined to be identified because talks are still in progress. Investors in Palo Alto, California-based Lala include New York-based Warner Music Group Corp., Boston-based Bain Capital Ventures and Ignition Partners in Bellevue, Washington.

    Lala, which is privately held, offers access to more than 8 million songs, including tracks from EMI Music, Warner Music, Sony BMG Music Entertainment and Universal Music Group.

    Source: [Bloomberg]
    After reading a similar article over at TechCrunch, it looks like Jason Kincaid decided to go and pay Lala a visit to see if he could find anything out.

    Update: I walked over to the Lala office, which is only a few blocks from us, to see if I could gather any more details. They didn't seem particularly happy to see me. I knocked on the door and a Lala employee answered, keeping the door half shut so that I couldn't see in. I asked if any of the company's executives were around. He looked over his shoulder, asked if they were, and a second later said they weren't (it was not a particularly convincing effort). He promptly shut the door, and I'm pretty sure I heard someone inside say something to the effect of "Are you serious, don't answer it!".
    He also notes the preview they covered on the Lala iPhone app about a month ago, so perhaps that kickstarted the idea, after it made it through their silly approval system. (I can just picture it coming through and some alert goes off that indicates "Possible Acquisition Candidate"and Steve Jobs gets and email to set up a meeting.

    Official Lala Website: Lala - Where music plays

    Some Facts:
    Lala was started by Seven Networks Inc. founder Bill Nguyen to let people trade compact discs via the mail. Nguyen also founded Onebox, which was acquired by Openwave Systems Inc. in 2000 for $513.5 million. Lala Chief Executive Officer Geoff Ralston was vice president of engineering at Yahoo! Inc. The current version of Lala debuted last year.
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