By ETHAN SMITH And YUKARI IWATANI KANE
Apple Inc. acquired online music company Lala Media Inc., possibly signaling an expansion of the computer giant's music strategy.
Terms could not be learned.
"Apple buys smaller technology companies from time to time and we generally do not comment on our purpose or plan." said Apple spokesman Steve Dowling.
Neither Lala's spokesman, John Kuch, nor its chief executive, Bill Nguyen, could be reached for comment.
Palo Alto, Calif.,-based Lala lets users pay 10 cents for permanent access to "Web songs" that can be streamed via a Web browser but cannot be downloaded to a user's computer hard drive or to portable players like iPods.
But the three-year-old company is developing an iPhone app that would greatly expand the service's reach, by making Lala Web songs available on the go via the phone's wireless Internet connection. Lala started life as a site that facilitated trading in used CDs, but soon after launching the company began pursuing various online music strategies before hitting on the Web-song approach in 2008.
It is not clear how Lala would fit into Apple's music strategy, which has so far focused exclusively on selling downloads of songs for around $1 and albums for around $10.
Still, many in the music and technology industries believe that Apple's music strategy needs to evolve to maintain its historic dominance of the online music business. The company could either find a way to adapt Lala's Web song offerings or it could incorporate the startup's technology in a subscription service of some kind.
Apple's iTunes Store still dwarfs all competitors, but lately it has been facing increasing competition from other providers like Pandora, Lala and Spotify. Competition is growing. Among the latest moves the founders of Skype said it was working on a new digital music startup called Rdio, while BskyB launched a service called Sky Songs and Mog Inc. announced a $5-a-month subscription music service.
Lala has faced some financial turbulence this year. Warner Music Group Corp. in 2008 disclosed that it had invested $20 million in Lala. Then earlier this year the company announced it was writing down $11 million of that investment, signaling that the startup had lost nearly 50% of its value.
Write to Ethan Smith at ethan.smith@wsj.com and Yukari Iwatani Kane at yukari.iwatani@wsj.com |
发表于 2009-12-4 22:08
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