“The key vehicle for the move is Apple’s newly acquired music-streaming service La La Media Inc. for which Apple paid $85 million, according to people familiar with the matter,” Smith and Kane report.
MacDailyNews Take: $85 million, $80 million, $17 million, $3 million, whatever; any one of them is petty cash to Apple.
Smith and Kane continue, “Where Apple’s iTunes requires users to download music onto a specific computer, Lala.com 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. That new business model extends Apple’s grip on the music business, giving it the ability to sell music through search engines and other Web sites and broaden its reach beyond people who come to its virtual store.”
“As part of the move, Lala executives have been given key positions helping shape music strategy for the iTunes Store, and some iTunes executives would report to them. ‘It’s our understanding that the Lala guys are going to be in very significant roles,’ says one person who has been briefed on Apple’s plans,” Smith and Kane report. “Some people familiar with Apple’s thinking cautioned the changes are in the early planning stages and could still be altered. But if the plans do go forward, these people said, Apple could start implementing them as soon as next year.”
Smith and Kane report, “In addition to selling music, Lala’s software also scans a user’s existing music library and matches its contents with songs on its own servers, then gives the user access to that music via a Web browser…. It is also possible that Apple would use Lala’s streaming technology as the basis for a subscription service, for which users would pay a flat rate in exchange for unlimited access to music.”
Full article here.
[Thanks to MacDailyNews Reader “James W.” for the heads up.]
I don’t think so. Apple isn’t going to implement anything that doesn’t require Apple hardware, and accessing from any browser won’t do that.
For sure Lala has some capability that can extend iTunes capability, but not in any way that these guys are talking about, or even thinking.
Even more bandwidth problems for AT&T;.
@ MacMental
And another reason for Time-Wanker, Comcrap, and all the other US ISPs to try to implement usage caps with outrageous overage charges.
The problem also is that iPods used on Macs can’t be loaded with stuff from Windows machines and vice versa. Apple would have to adopt a neutral storage architecture to make this work. Not going to happen.
Who says you have to use a browser? The author says “connected to the internet”. That means your iPhone, iPod touch, and macbook via iTunes. And iTunes is on Windows too, so add in all Windows laptops.
“Who says you have to use a browser? The author says “connected to the internet”.’
You’re kidding, right? If you’re connected to the internet, you got there with a browser. No browser, no connection.
@Gregg Thurman
Maybe Apple’s at a tipping point where the sale of content is lucrative enough that they can relax about hardware sales.
Besides, who knows what new gadget Apple will release in 2010, that will complement cloud services so well, that everyone will want one.
@Gregg
Then you must mean that iTunes is a browser. I wouldn’t disagree but you DO mean that right?
Apple isn’t going to implement anything that doesn’t require Apple hardware… —Gregg Thurman
Actually, they already have. iTunes for Windows has been available for quite some time, and media downloaded from the iTunes Store can be played on any media player.
Yes, greg Thurman is on the wayback bus, if apps have proven anything, it’s that browsers serve a limited purpose.
Alansky,
by iTunes media you mean songs, right? Most video and I believe audio books are still DRM and clearly the App store apps are Apple hardware only.
Think Satellite?
“Apple is considering adopting that same model for songs sold on iTunes…”
There’s no evidence to support this statement.
As has been stated previously, Apple buys tech companies all the time. The why’s and the wherefores are subject to nothing but journalistic speculation.
If tablet is real (built-in 3G connectivity), then this allows all previously ownediTunes material to be available on tablet without compromising hard drive space or worrying about extending “permissions” on older copies of music (with DRM).
What happened to ‘customers want to own their music’??
Apple never buys anything to just let it sit on the back burner till all of the talent evaporates. Often they buy stuff for the talent which they use and put to work innovating something new and unexpected.
I would expect that Apple will not use the Lala business model at all but will move to use the Lala tech in a new product that they’ve test floating now. That is correct! The All new Mac Mini iTunes Server with Internet Streaming, It is the perfect extension to iTunes and makes you responsible for your own bandwidth it reduces the load on the Cell network as must users are limited to 2 to 5 megabit stream speeds kind of limits that possibility of Stream HD content and constant Video content or even audio content to more then 3 to 5 devices (depending on how compressed the audio is) to your iPhone or iPod touch. This is more likely the path that Apple will take other then the running of a Lala Business model or a subscription business business model with as failed but continues to be the wet dream of record company leaches worldwide. Any type of subscription model requires the use of DRM to prevent coping, even when the content is streamed otherwise your business model fails and fails apart because without DRM on a streaming subscription service the record labels are going to want higher licensing fees and by the time all is said and done subscription revenues don’t cover the licensing fees nor do they cover the services operating costs of the service.
As a former CEO of a music subscription service said,”The only people that ever make money from a subscription music service is the record labels. They get paid first and they get the bulk of all the money that the service has and will ever make. The Service is left to operate on the few scrapes that are left over and it never covers the services fixed cost. Investors what a growing business and you can’t grow with negative profit so attracting new investors to help you grow doesn’t happen and the investors you have want you to sell to anybody that shows any interest even if they stand little to no chance at getting a profit on their investment and the more investor cash you’ve burned through the less likely that the current investors will mind or flinch a breaking even or even losing money in a sale of the subscription music business. In other words, someone offers to buy the subscription music service you started and offers 10 cents for every dollar invested in the service, the investors are going force you to take the money and sell the company.
“Apple’s iTunes requires users to download music onto a specific computer” is a bit misleading. Since apps and music can be downloaded directly from the iPhone. (Unless that is considered a computer in the way the authors meant it.)
And since the music can be used by more than one computer (and multiple iPods), “specific computer” doesn’t mean so much. It just means a little bit of work later to get everything synched.
@Gregg Thurman
“You’re kidding, right? If you’re connected to the internet, you got there with a browser. No browser, no connection”
Your conception of the internet is pretty limited. There are many ways to connect and utilize the internet without the use of a browser. VPN taps the internet to connect me to my office server – no browser. Quicken Bill Pay taps the internet for my online transactions – no browser. iTunes uses the internet without being a browser. So, No, I’m not kidding.
Music discovery is the next big thing. Finding new and interesting music on the radio can be frustrating because they play the same small set of songs day in / day out.
Being able to listen to streaming music, identify songs you like and being able to purchase will capture a lot of impulse buying. All of that is possible on the iPhone (or Touch with wifi) or Mac/PC.
LaLa’s setup could make that possible. You won’t make money on the streaming service but the song purchasing would work.
This could also be integrated with internet/HD radio stations. They could get a small cut for any song purchased through their station. All mediated through Apple who get their cut too.
@ MacDailyNews…. If $85 million is petty cash to Apple, then why don’t they give me a free 27″ iMac?
@Gregg, get a clue guy. Still using dial up to get to your AOL account? The Internet can be accessed and utilized so many different ways. ssh, vpn, curl, ftp, just to name a few.
I think you missed it, Dave.
How will downloading a magazine onto the MacTablet work/happen?
Will you have to download the whole thing to your computer then transfer it to the device?
Will you have to wait for it to download completely over your net connection (whatever that may be), before you can look at it?
Maybe, the basic structure gets downloaded, then as you start looking at the magazine, the fluid content is Streamed to you On Demand.
Just think of the feedback that the system will give.
The magazine is going to be Completely Personalized for You. Ad people are going to ctj.
You will spend more time looking at it then a regular magazine because each time you look at it, stories, ads and pictures can be updated.
@DogGone:
I agree about music discovery; I do it the best I can now. But I’m going to paraphrase MDN’s position (still?) somewhat by saying that I think people want to own music NOT rent it. All the other services that have tried the subscription method have absolutely been ripped to pieces on MDN, and most or all of them have failed. I don’t hear much negativity here now that it is a possibility for Apple to do it too.
I like a the idea of listening to free streams and having the ability to buy music if i hear things I like, but I will absolutely NOT be a part of a no pay, no play, subscription music scheme. If it sucks for all others that have tried it before, it should suck for Apple too.
I have to agree that this does not presage a sea change in the iTunes store model of buying songs. I do not see Apple going away from that.
The technology does allow Apple to add into iTunes the functionality of streaming songs you own to internet connected devices, either from your own home or possibly from the iTunes server (didn’t the RIAA challenge the latter model at some point). The former can be done currently, but it requires some work or third party software, eg Simplify Media. It would be much more accessible to the majority of users if it were built into iTunes. I still carry as much music on my iPhone as possible, but it is nice to be able to stream any music from my home iTunes library. Streaming is great, but depending on a connection for all access to your music (the Lala model) currently has enough limits that it cannot yet replace having the songs on your iPod/iPhone.
Lala is a nice addition and can bring some functionality to iTunes, but I will be surprised if this is a game changer for Apple.
How about streaming anything you own as part of mobileme.