OPINION: Apple is finally ready to move beyond music downloads

Posted on December 7, 2009 by

Apple has purchased the music streaming site Lala.  Ars Technica has an article discussing what Apple’s plans could be with this new service.

From the article:
Apple has once again dipped into its massive cash hoard to purchase a small company, in this case the music streaming service Lala. Many are seeing this as a sign that the company’s finally ready to move beyond music downloads.

The case for this meaning that Apple is ready to start streaming was made by an unnamed source in a Reuters report, who told the news service that, “Apple recognizes that the model is going to evolve into a streaming one and this could probably propel iTunes to the next level.” As our original report noted, Apple has also been rumored to be testing a streaming service for video content; adding music to the menu seems like an obvious choice.
But, if Apple is already testing a functional streaming service, there seems to be little need to buy an entire company to obtain similar technology. In fact, Lala uses Flash for wrapping its streams, and Apple has been notably averse to using that software for just about anything—it’s certainly not displayed within iTunes as things currently stand.
The case for this meaning that Apple is ready to start streaming was made by an unnamed source in a Reuters report, who told the news service that, “Apple recognizes that the model is going to evolve into a streaming one and this could probably propel iTunes to the next level.” As our original report noted, Apple has also been rumored to be testing a streaming service for video content; adding music to the menu seems like an obvious choice.

But, if Apple is already testing a functional streaming service, there seems to be little need to buy an entire company to obtain similar technology. In fact, Lala uses Flash for wrapping its streams, and Apple has been notably averse to using that software for just about anything—it’s certainly not displayed within iTunes as things currently stand.

And then there’s the licensing issue. Various reports suggest that Lala’s streaming license is non-transferrable, meaning that Apple would need to engage in additional negotiations with a music industry that has very publicly described its unease with Apple’s dominance of download sales. Plus, each country that Apple operates in would involve a separate licensing agreement; Lala only had a license for within the US.

Read the full article here.

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