Apple Bought Lala To Shut It Down?
from the can't-have-competition... dept
I've been a pretty harsh critic of Lala over the years. The company was long on hype and short on substance with its ever changing business model. First it was a CD swapping service. Then it was a free streaming music service. Then it was an iTunes-in-the-cloud. Still, the final product was decent, and with a bit of work could take on Spotify in the market. When Apple swooped in and bought Lala late last year, many people got excited over the possibility of Apple creating its own streaming music service that really could be seamless.Instead, it looks like Apple bought Lala to shut it down. Just five months or so after purchasing it, Apple has announced that Lala will be closing at the end of May, pissing off lots of users. Now, it's entirely possible (or even likely) that Apple is timing the shutdown with a launch of a totally new streaming iTunes-in-the-cloud type service, but it does seem weird to buy a company and shut it down so quickly, and raises questions of whether or not the purchase was really about building out Apple's offerings, or about shutting down a nascent competitor just before Apple launched its own version. Also, if the plan is to launch its own version, why "shut down" Lala? Why not just transfer them over to the new service?
In the meantime, Spotify still hasn't launched in the US, but you would think that now might be a good time to step in and sign up disgruntled Lala listeners -- before Apple really enters the market...
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Filed Under: cloud, itunes, lala, music, streaming
Companies: apple, lala, spotify
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More often, they want the expertise that resides in the company, but not the actual product. C.f., Apple's purchase of that chip designing shop, which was folded into their A4 team.
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I don't remember YouTube being shut down...
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Another point to consider is the accounting system that runs iTunes. From what I have heard the system is difficult, at best, to make changes to. Again, I heard this second hand, but supposedly this is the reason that when in app purchase first launched you could not have in app purchases in Free apps. Once they corrected that bit in the accounting system, they launched it in the iPhone OS SDK.
With that in mind, perhaps moving LaLa users into the new system may have proven to be a daunting task. Why bother with the daunting when you can rebuild your user base, with ease from scratch, using your existing sales channels?
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I really liked Lala
I would never ever give money to Apple for anything!
so pissed!
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Re: I really liked Lala
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Re: I really liked Lala
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Purchasing Intellectual Property
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I don't understand your assumption...
If this pisses of some of the current Lala users like Jason Sykes who had invested a measly $20, why would Apple care? The Lala user base is a gnat on the ass of the iTunes user base. Apple didn't buy Lala for the community, it bought Lala for the technology and for the talent, in my opinion. It's much more important for Apple to add new value to the iTunes user base than to worry about the Lala user base.
I don't understand commenters like RW who are foaming at the mouth with Apple hate. Apple fought the labels to get rid of DRM - and was successful - yet RW thinks this is a plot to add DRM? Some people just don't pay attention.
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Re: I don't understand your assumption...
Apple only reduced their DRM scheme when they ran into competition.
So much for any respect for anything else you said. Especially since your analogy is COMPLETELY WRONG.
You close a bar because you only have one, and want to provide a good customer experience. There's no scarcity online, there was no reason to shut it down. Certainly not to "remodel".
Further, just because you're an asshole to a "gnat on the ass", doesn't mean you're not an asshole.
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Re: Re: I don't understand your assumption...
Apple only reduced their DRM scheme when they ran into competition."
The labels insisted on DRM. Apple gave up the uniform $0.99 price in favor of variable pricing in order to secure the rights to sell non-DRM content. Apple sells more content without DRM and Apple likes to make money.
"So much for any respect for anything else you said. Especially since your analogy is COMPLETELY WRONG.
You close a bar because you only have one, and want to provide a good customer experience. There's no scarcity online, there was no reason to shut it down. Certainly not to "remodel"."
Last time I looked, there was only one Lala service online and it was the only streaming service that Apple owned, so the analogy works. Scarcity has nothing to do with this. It's about integration and re-branding, which is a lot like the online equivalent of remodeling.
"Further, just because you're an asshole to a "gnat on the ass", doesn't mean you're not an asshole."
You may not know very much about anything, but at least you're self-aware.
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Just wow.
Mike, you used to be so insightful. You talked about economics and strategy, and marginal costs and the implications of non-scarce goods.
Now, it's all anti-this and anti-that, and tinfoil-hat-this and conspiracy-that.
And now, you've got Apple buying a locker/streaming service, spending billions to build out data centers, and shutting down the retail operations of the streaming service... and the best you can come up with is that a multi-billion dollar company bought an unprofitable startup solely to shut them down?
Ouch. Apple might have bought Lala for talent, and perhaps for technology or patents, and *maybe* as a precursor to a streaming version of iTunes. This "bought them to shut them down" is about as intelligent and insightful as the old "GM has secret engines that get 1000mpg, but they don't release them so they can profit from the oil cartels!" crap.
Maybe Techdirt's heyday was a fluke, or maybe I was too busy and tired to notice this level of nonsensical thinking. Dunno. I'll miss the increasingly-rare economic analysis, but the world really only needs one Consumerist.com. Best of luck to you.
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if they got me the pirate to pay for music are they really unprofitable?
you must not be familiar with lala
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CD Credits
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Re: CD Credits
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wtf
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wtf
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