Apple paid $80 million for Lala

Hammacher Homepage 300x250“On Friday I reported that Apple was buying Lala at a fire sale price, which meant that investors in the music service wouldn’t get their money back. I was wrong,” Peter Kafka reports for AllThingsD.

“Apple ended up paying around $80 million for the company, according to multiple sources. That’s less than half of what investors were valuing the company at in 2008, but it’s more than the $35 million the company raised throughout its life. Which means that some investors could get their money back and more,” Kafka reports.

“Meanwhile the LaLa team, which should begin reporting to Apple today, gets credit for selling the company at any kind of premium at all. It’s not a home run, but it’s much better than it could have been,” Kafka reports.

“LaLa’s real asset was its technology team: In the end, Apple bought the company to get its hands on the company’s engineers, who had built a slick streaming service as well as an iPhone app that Apple has yet to approve,” Kafka reports.

Full article here.

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]

23 Comments

  1. “Apple paid $80 million for Lala”…

    …which they found in the seat cushions of the couch in Steve’s office.

    Chump change for another great iTunes differentiator.

  2. @ R2 – Apple isn’t Microsoft (despite what the demented “they’re both equally evil!” folks would have us believe).

    Microsoft has the history of buying out competitors just to kill them off.

    Apple’s history of acquisitions (or at least the ones within this past decade) have all been additive purchases, acquiring technology and/or expertise which aligns well with the goals they already have.

    For that reason, I don’t think we’ll ever see an Apple-buys-Adobe scenario.

  3. R2 writes, “Still leaves plenty of money left to buy Adobe.”

    Oh, give it a rest! Adobe could never provide the requisite ROI to justify the purchase, and Apple could develop competitive products for a fraction of the cost required to buy the company outright.

  4. Microsoft buys marketing and advertising companies, Apple buys companies for their engineers.

    That is all you need to know about innovation at MS and Apple.

  5. “On Friday I reported that Apple was buying Lala at a fire sale price, which meant that investors in the music service wouldn’t get their money back.” Peter Kafka reports for AllThingsD.

    I just made something up, and then turned it into an article. That’s how we get paid. It doesn’t have to be true. We don’t really do research. It takes too long.

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