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What Apple’s Buyout Of Music Site Lala Means

A few weeks ago I wrote about how Google was using streaming music site Lala (along with MySpace) to buck the Apple hegemony of iTunes.

Much to my surprise, I learned this weekend from the Associated Press that Apple has swallowed up Lala in a buyout for an undisclosed amount of money.

"Apple buys smaller technology companies from time to time and we generally do not comment on our purpose or plans," said Apple spokesman Steve Dowling on Sunday.

Lala has developed an application - not yet available to the public - that allows users to buy the right to stream songs from a digital locker for an unlimited time on their iPhones for 10 cents each.

As PCWorld points out, the acquisition of the failing company could mean scooping up a possible competitor of the digital music for the iPhone.

Reports from Reuters pointed towards Apple using the Lala acquisition as a catapult to put iTunes, which already represents 70 percent of the online music market, as a major contender in the streaming world.

Ars Technica discussed in a lengthy piece how curious it is that Apple acquired a technology that uses Adobe Flash, despite Apple's unwillingness to allow the technology for the iPhone.

It's possible that Lala is going to used for other means. One Lala technology, called Music Mover allows users to migrate their music collection to their site for playback anywhere an Internet connection is available.

This technology, called cloud computing, is likely the next step for online media, not the streaming feature, which has been around for a long time.

Cloud computing is when a user's data – including music, photos and other files- don't physically exist as ones and zeros on a person's hard drive, but rather at a centrally-located server to be accessed anywhere. For example, you could access your music from home, work, school, your iPhone or your laptop. Your life can be synced anywhere you go. The downfall of this is that a speedy web connection or mobile data plan must be available at all times. And most of us know that's not always possible.

One popular use of cloud computing is the service Dropbox, which allows files to be synced on multiple computers and enabled mobile devices. However, free users are limited to 2GB and that space must be available on each synced system.

This all could mean that one day all of your music can be streamed directly to your iTunes, iPod or iPhone without the consumption of physical space on a hard drive.

That could be advantageous for music companies, as it would limit make music licensing available to a single user. Currently, iTunes allows users to purchase popular music free of digital rights management (which are music files that can be used any way the user sees fit) for $1.29. If users only stream their music, it then becomes difficult to illegally share music files not physically stored on a hard drive. Countless suits have shown that music sharing has been a major thorn in the side of the music industry for nearly the entire decade.

However, past remarks by Apple CEO Steve Jobs are telling in this case. In 2007, Jobs said he believed users don't want to rent their music. He said, "People want to own their music."

This acquisition could either mean a move away from this point-of-view at the request of fuming record executives who have consistently pushed for a subscription model for iTunes, or simply a reinforcing of technology and engineering manpower from a flailing company.

Only time will tell what the man in black turtleneck and jeans is really up to.

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