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How Apple Killed an iTunes Competitor

Soulskill posted about 2 years ago | from the boom-iHeadshot dept.

Businesses 143

An anonymous reader writes "Ed Bott recounts the story of Lala.com, an innovative online music service that reached the top of Google search rankings for consumers seeking music. Their prices were frequently better than the prices on iTunes, and they partnered with Google for the search giant's Music Beta. Lala's founder, Bill Nguyen, decided the time was ripe to sell, entertaining offers from both Google and Nokia. Unfortunately, Nokia's offer was poor, and Google tried to lowball Nguyen. Apple, however, was not so foolish. Correctly identifying a threat to its growing music empire, Steve Jobs offered $80 million for the company, and Nguyen accepted. 'The ultimate irony in this story is that quite a few notable members of the Lala-to-Apple team followed Bill through the door and onward to his next venture. They left millions in options at a the $196.48 exercise price they had from the 2009 sale/retention bonuses. Some of those same engineers returned to Apple in the highly covered [Color Labs acquisition] rumor that 20+ engineers went to Apple for $7M. Apple obtained the same employees for pennies on the dollar. This time with even more experience and startup life under their belt. Paying twice was genius.'"

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Poor sport (-1)

Anonymous Coward | about 2 years ago | (#42636431)

It's just terrible, Ed. I can't imagine your buddies at Microsoft ever doing such a thing.

Title is misleading (4, Insightful)

Taco Cowboy (5327) | about 2 years ago | (#42637949)

I am no Apple fanboys, but the title "Apple kills competitor" is misleading.

Lala.com was for sale. Apple bought it fair and square.

If only Google wasn't so foolish to play lowball, Google would have a powerful franchise right now to out-compete Apple on its own turf.

And yet.... (1, Insightful)

Anonymous Coward | about 2 years ago | (#42636433)

I still go out of my way to give my business to Amazon or any other legal alternative to avoid doing business with apple whenever possible.

Really not sure what it was they did to piss me off (probably a huge pile of small things over the years) but man I just do not like them.

Re:And yet.... (5, Insightful)

Anonymous Coward | about 2 years ago | (#42636507)

Don't you forget that Apple played a huge role in making non-DRM protected music from majors available through online stores in the first place?
First majors started to make unprotected music available through competitors so Apple coudn't control the prices and then they made a bold move and made DRM go away from iTunes for the price of some songs being slightly more expensive than the others.

Re:And yet.... (2, Informative)

alen (225700) | about 2 years ago | (#42636535)

wasn't amazon selling non-drm music for years before apple?

and then apple had the nerve to charge you $.30 per song to undrm it?

That's what he was saying (5, Informative)

SuperKendall (25149) | about 2 years ago | (#42636609)

wasn't amazon selling non-drm music for years before apple?

About a year.

It was the music companies last ditch attempt to break free from Apple.

It failed so finally music companies allowed Apple to sell DRM free music (which was never under Apple's control, it was up to the labels which is why Amazon got to do so a year earlier).

Re:That's what he was saying (1)

Barlo_Mung_42 (411228) | about 2 years ago | (#42637673)

Yep, it was up to the labels. emusic was always drm free for example.

Re:That's what he was saying (2)

Pollardito (781263) | about 2 years ago | (#42638059)

Being able to sell tracks for prices other than a uniform 99 cents was part of it too. Apple caved on that in order to get the right to sell DRM-free music. Here's an article from the time of the switchover [macworld.com]

Re:And yet.... (2, Informative)

milkmage (795746) | about 2 years ago | (#42637083)

amazon DRM free first? impossible. they didn't even have a music store yet.

http://arstechnica.com/uncategorized/2007/06/emi-says-drm-free-music-is-selling-well/ [arstechnica.com]
Although the iTunes Store was the first online store through which EMI sold its DRM-free tracks, Amazon recently said that it will also be selling DRM-free EMI songs through its newly-announced music store later this year

"apple had the nerve to charge"
no. "price increases by the record labels, which were made possible by Apple's capitulation."
http://news.cnet.com/amazon-follows-apple-to-$1.29/ [cnet.com] ...so apple made DRM go away in exchange for higher prices. you think amazon raised prices because apple did? or you think amazon raised prices because the lables told them to? makes no sense to RAISE your prices to match the competition unless the IP owners set the terms (for DRM free). makse more sense to me to keep the price LOWER (you know, to attract more customers) - than to raise them

Re:And yet.... (1)

Smauler (915644) | about 2 years ago | (#42637467)

Amazon was DRM free first of the major online retailers. There may have been some DRM free offerings at itunes previously, but checking each song is not practical. I only started buying music online when the entire catalogue was DRM free. That's why I only started buying music online when Amazon went DRM free... since I started there, I've stayed there.

Prior to buying music online I just pirated it, because buying it was not a real option.

Re:And yet.... (1)

Anonymous Coward | about 2 years ago | (#42637615)

amazon DRM free first? impossible. they didn't even have a music store yet.

Amazon MP3 Store launched in August 2007, DRM free.

Sorry to disrupt your little Apple World with facts.

Re: And yet.... (0)

Rational (1990) | about 2 years ago | (#42638069)

We're not arguing dates; the only reason Amazon was selling DRM-free music and Apple wasn't is that the labels allowed them to, trying to build Amazon into an iTunes competitor.

Re:And yet.... (3, Informative)

beelsebob (529313) | about 2 years ago | (#42638231)

wasn't amazon selling non-drm music for years before apple?

No, Apple were first with EMI. The rest of the big 4 held back from apple, so amazon were the first to have all their catalog unlocked.

Re:And yet.... (0)

beelsebob (529313) | about 2 years ago | (#42638229)

Yep, and actually they did even more than that, Apple had the first unprotected music legally available too –they got EMI to make the switch. The rest of the then big 4 then decided to use it as a bargaining chip.

Re: And yet.... (-1)

Anonymous Coward | about 2 years ago | (#42636729)

I go out of my way to give apple as much business as possible. They are gods!

Re: And yet.... (1)

sammyF70 (1154563) | about 2 years ago | (#42637779)

The vision of God that thou dost see, is my vision's greatest enemy. (nearly a William Blake quote)

Re: And yet.... (1)

Runaway1956 (1322357) | about 2 years ago | (#42638009)

And you are surely a legend in your own mind.

and they paved the way for spotify (4, Insightful)

alen (225700) | about 2 years ago | (#42636441)

if we have learned one thing with IBM and Microsoft is that you can't stop technological and cultural change

subscription music is here to stay and apple can't do anything about it

Re:and they paved the way for spotify (1)

jaymz666 (34050) | about 2 years ago | (#42636847)

ultimately subscription music costs more to the end user and pays the content producer less. Then there's all the music not available through sub

Re:and they paved the way for spotify (4, Insightful)

alvinrod (889928) | about 2 years ago | (#42636947)

And let's not pretend that buying through iTunes or any other competitor is doing the content producers any better. They're still getting pennies on the dollar. If you have $20 and want as much of that to go the artist as possible, go see them live or buy a shirt at a show. They'll make far more money from that than they'll ever see from proceeds from subscription or album sales.

Re:and they paved the way for spotify (1, Interesting)

idobi (820896) | about 2 years ago | (#42637279)

This isn't even a fair comparison. For every track sold on iTunes, the "label" (by label, it could apply to an actual label, or the artist themselves if they self published) gets $.70. For every track played on spotify, the "label" gets $.0017. Buying through iTunes is vastly more beneficial to content producers.

Re:and they paved the way for spotify (3, Interesting)

alvinrod (889928) | about 2 years ago | (#42637471)

Regardless if which you buy, the actual artist gets next to nothing. The indie labels probably have a better deal, but there are still a lot of artists that aren't on iTunes. Maybe things have changed more recently, but there was a time where you couldn't find anything that wasn't from a major label through them and it's been pretty well established how badly they screw over the artists. They might not be getting paid either way given the usual studio accounting practices and all of that 'expensive studio time' and other costs that went into making the album.

So the point still stands. For a lot of bands or artists, if you actually want them to see any money you're far better off going to a show or buying some merchandise. Otherwise it's not exactly easy to tell if someone is signed to a label that isn't completely shafting them.

Re:and they paved the way for spotify (1)

davester666 (731373) | about 2 years ago | (#42637733)

Actually, through iTunes, at least some artists may get a LOT more than through regular CD sales...

http://www.techdirt.com/articles/20110404/12211913771/record-labels-may-owe-artists-close-to-2-billion-lawsuits-ramp-up-with-rick-james-lead.shtml [techdirt.com]

Basically, some stupid lawyer for labels [as it's not like they used the contract written up by the artist's lawyer] included a MUCH higher royalty for licensing music vs the sale of the same music. And the labels have been broadcasting that you only get a license to a song through iTunes and that it is NOT a sale.

Re:and they paved the way for spotify (1)

th3rmite (938737) | about 2 years ago | (#42638499)

I buy plenty of music from independent artists through iTunes, and have done so for quite a few years now.

Re:and they paved the way for spotify (4, Informative)

mysidia (191772) | about 2 years ago | (#42637715)

For every track played on spotify, the "label" gets $.0017. Buying through iTunes is vastly more beneficial to content producers.

OK... but what happens when the track is in your playlist, and you listen to it every day on a subscription service, for 2 years (assume about once a day); in other words 365 x 2 = 730 times spread out over 2 years?

OK, discounted ~5%/Year = 0.0137%/Day , the present value of that stream of revenue for the label would be:
( $0.0017 / 0.000137)*(1-1/(1+0.000137)^730) = $1.18

And despite them having gotten $1.24 from you worth $1.18 today..... you still don't own the sound track. You have to continue the subscription, if you want to keep hearing it :)

So... the question becomes... what happens, if you keep listening to the track once a day one third of the days of the rest of your life? Assuming you are age 30, and live until age 70, that's 4870 listens, or $0.017 * 4870 = $82.79

Which is worth approximately ( $0.0017 / 3 / 0.0000102669)*(1-1/(1+0.0000102669)^4870) = $2.69

In today's dollars, and $2.69 is a heck of a lot more money for the label than $0.70, hell, it's over 3 times as much.

For you to subscribe to the service, and listen to your music through that, as long as they get their little .17 cents every time :)

Re:and they paved the way for spotify (1)

mysidia (191772) | about 2 years ago | (#42637805)

Which is worth approximately ( $0.0017 / 3 / 0.0000102669)*(1-1/(1+0.0000102669)^4870) = $2.69

Or rather, 5% at 365 days a year = of the 14610 days, that's actually 0.0001 per interval, and there are 14610 intervals, (so the above is actually an underestimate, of the worth to the label, of you subscribing) -- but the story is still the same, it's still more profitable to the label if you subscribe for 2 years, and then it's potentially several times as profitable, if you keep subscribing.

( 0.0017 / 3 / 0.0001)*(1-1/(1+0.0001)^14610)

On the other hand, the iTunes thing was a one-time purchase.

And the iTunes thing gave you a digital file, so you'd never need to buy it again (Owch). The whole "Sell a CD", put the songs on multiple CDs, "Then make them buy a DRM encoded version from iTunes later" to have to rebuy the song multiple times, of course, was still better for the labels.

But subscription isn't that bad.

Re:and they paved the way for spotify (1)

maxwell demon (590494) | about 2 years ago | (#42637875)

Actually it doesn't matter if you listen to one song of the label 100 times, or 100 songs of the label 1 time each. The label will get the same money. However if you have to buy the songs, you'll only buy those which you intend to listen to repeatedly.

Re:and they paved the way for spotify (1)

mysidia (191772) | about 2 years ago | (#42637983)

However if you have to buy the songs, you'll only buy those which you intend to listen to repeatedly.

Whether you buy a song you won't necessarily listen to repeatedly -- does depend on how well your curiosity about the song is satisfied by the 30 second preview, or what other means you might have available to "try out" a song you don't know about, to decide if you might like to listen to it repeatedly. :)

Re:and they paved the way for spotify (1)

maxwell demon (590494) | about 2 years ago | (#42638075)

I don't know about you, but I definitely won't buy a song just to find out if I like it.

Re:and they paved the way for spotify (0)

Anonymous Coward | about 2 years ago | (#42638205)

track is in your playlist, and you listen to it every day on a subscription service, for 2 years (assume about once a day)

Listening to the same track every day for two years? How did you even come up with this?

Re:and they paved the way for spotify (2)

oodaloop (1229816) | about 2 years ago | (#42638513)

Jesus. I had no idea listening to music involved so much math.

Only true for artists who aren't their own label (1)

Nova Express (100383) | about 2 years ago | (#42637455)

Increasingly musicians (and movie makers, and writers) are realizing that they can cut the middle man out entirely, become their own label, and deal with Apple/Amazon/etc. directly. It's a lot of freaking work, but it gives artists total control, and have longer and more profitable careers than record labels that want to churn flash-in-pan artists for maximum profit before going on to the Next Big Thing.

And Apple and Amazon, for all the bitching people do about them, are the ones whose domination of Internet sales has allowed musicians to break the parasitic grip major labels had on the marketplace. The Internet would have accomplished the same disintermediation sooner or later, but Apple alone probably hastened the results by a decade.

In the future, all artists will be their own integrated vertical monopolies.

Re:and they paved the way for spotify (1)

Tablizer (95088) | about 2 years ago | (#42636999)

if we have learned one thing with IBM and Microsoft is that you can't stop technological and cultural change

But they did a hell of a job in slowing it down.
   

Re:and they paved the way for spotify (0)

Osgeld (1900440) | about 2 years ago | (#42637867)

as much as I hate to say it there was no such model before apple

its one of the few things they actually did do themselves (unlike drop down menus, icons or rounded rectangles)

Apple knows (0)

Anonymous Coward | about 2 years ago | (#42636445)

..what can kill and what can heal them

Re:Apple knows (-1, Flamebait)

kelemvor4 (1980226) | about 2 years ago | (#42636797)

..what can kill and what can heal them

Jobs can't be healed, I'm afraid. Without him to sell garbage to the masses, the company will gradually shrink back down to the nothing it was prior to his return.

Love the headline (1)

Anonymous Coward | about 2 years ago | (#42636459)

I like that this same story was on macrumors as "how Steve jobs acquires a company" and on /. It's how apple KILLED a competitor. Dramatic much?

Re:Love the headline (-1)

Anonymous Coward | about 2 years ago | (#42636809)

I like that this same story was on macrumors as "how Steve jobs acquires a company" and on /. It's how apple KILLED a competitor. Dramatic much?

I'm sure Germans often read positive spins on the things the Nazis were doing for their country. I believe it's called propaganda.

Re:Love the headline (-1)

Anonymous Coward | about 2 years ago | (#42637365)

"I'm sure Germans often read positive spins on the things the Nazis were doing for their country."

Like flying a man to the moon? Ah, no, that's what the Americans spin about _their_ Nazis.

Re: Love the headline (1)

Xeranar (2029624) | about 2 years ago | (#42637169)

Technically /. was more accurate in that Jobs bought it almost exclusively to keep iTunes as the predominate selling theme of iDevices. I mean it is possibly the biggest selling feature after the social hierachy implications.

Lala was not the threat (4, Insightful)

Fnord666 (889225) | about 2 years ago | (#42636461)

Lala was not the threat. The threat was that Google would acquire Lala and in turn would combine it with their position in the search engine realm. That was the threat and Apple paid the price to keep Lala out of Google's hands. It would have been interesting to see what would have happened if Google hadn't tried to lowball them and had bought Lala at the time.

Re:Lala was not the threat (1)

93 Escort Wagon (326346) | about 2 years ago | (#42636503)

Given that, as you say, Google tried to low-ball them... why is Apple getting the blame here? We're not exactly talking about YouTube - Google could easily have coughed up more than 80 million if they really thought the business was worth spending the money on.

Re:Lala was not the threat (1)

Anonymous Coward | about 2 years ago | (#42636549)

Google probably didn't think they were worth it. While Google's Play Music isn't the greatest by any means, yet, it is growing constantly and getting better and better. Google probably looked at how Lala would have helped them but really didn't find it would help them enough to pay $80 million or something for it.

Re:Lala was not the threat (0)

Anonymous Coward | about 2 years ago | (#42637425)

That's not it at all. Sequoia Capital, who provided Google VC and have members on the board greased the wheels on the Youtube deal.

Re:Lala was not the threat (4, Informative)

DogDude (805747) | about 2 years ago | (#42636651)

That DID happen. For a few months, you could search for any song, and Google would display the song with "play" button at the top of the search results that played the entire song. It worked flawlessly.

Re:Lala was not the threat (1)

fermion (181285) | about 2 years ago | (#42636807)

The first mistake was partnering with Google. There is not a service that Google does want to give away to sell advertising. So while Google was bidding on the assumption that it would never make any direct cash, just build market dominance, Apple could build based on real value of the service. In this side Lala was doomed. Either Apple would bought it, or google would have put it out of business.

Re:Lala was not the threat (1)

Anonymous Coward | about 2 years ago | (#42637651)

[quote]There is not a service that Google does want to give away to sell advertising.[/quote]

Google Apps would like a word with you. Same with Google Play, Google Wallet, and Google Drive. Oh, and Google Calendar and Blogger. And Android. And Chrome.

Re:Lala was not the threat (2)

ThisIsSaei (2397758) | about 2 years ago | (#42637683)

Usage statistics are a form of data collection to use in ad targeting.

Wallet is the most glaring example. What advertising data could you want more than what people are buying, and when? Blogger is indexable, and works with account targeted ads based on interest. Chrome pushes html standards that allow more dynamic delivery of Google's products in general -- they even explicitly state that in the Chrome mission statement.

fermion is 100% correct. Google is a business first.

Re:Lala was not the threat (0)

Anonymous Coward | about 2 years ago | (#42637489)

Keeping Lala out of Google's hands was worth $80M to Apple. Keeping Instagram out of Twitter's hands was worth $1,000M to Facebook. Can we please burn civilization down and try again?

Disappointing to read (1)

macwhizkid (864124) | about 2 years ago | (#42636465)

It's disappointing how the Microsoft-pioneered "buy up your competitors before they can afford to buy you" technique has become standard practice for Apple. Up until the day before they were purchased, so many people I knew were using Lala on a daily basis. And why wouldn't you use it? Lala had a great catalog, came up high on Google results, offered full songs for preview, and worked in any web browser. And this was all 2-3 years before Spotify was available in the US.

When Apple bought them, I naturally assumed they'd be offline for a couple days and then reappear on "me.com" or something. In fact, months went by before I realized that wasn't going to happen.

It's too bad. iTunes has gotten a lot better, but competition is always a good thing.

Re:Disappointing to read (0)

Anonymous Coward | about 2 years ago | (#42636481)

"Buy him out, boys!"

Re:Disappointing to read (5, Informative)

Anonymous Coward | about 2 years ago | (#42636509)

Are you sure you read the article? LaLa approached Apple and asked to be purchased.

Re:Disappointing to read (0)

Anonymous Coward | about 2 years ago | (#42636675)

Are you sure you read the article? LaLa approached Apple and asked to be purchased.

Facts getting in the way of Apple bashing on /.? You must be new here.

Re:Disappointing to read (0)

Anonymous Coward | about 2 years ago | (#42636617)

This was happening long before Microsoft was a glint in Gates' eye - I've worked at a couple of places where it happened, you buy the compitition and getr their customers, it's a pretty standard way of business.

Re:Disappointing to read (5, Insightful)

DogDude (805747) | about 2 years ago | (#42636667)

It's disappointing how the Microsoft-pioneered "buy up your competitors before they can afford to buy you" technique has become standard practice for Apple.

Oh, child, read some history. That had been going on for at least 100 years before Microsoft existed.

Re:Disappointing to read (0)

Anonymous Coward | about 2 years ago | (#42636927)

Also companies like Google and Facebook...and Intel and Amazon and IBM and...well you know...have all been doing it. Remember Google has porbably made the most purchases over the last 18 months...particuarly in the are of search. SO I am not too sure what his point is. Companies buy competitors, partners, etc for various reasons. Apple is one that does it...one of many but certainly is not the most prolific.

Actually a competitor sold out ... (5, Informative)

perpenso (1613749) | about 2 years ago | (#42636467)

Apple didn't kill a competitor, a competitor simply sold out, taking $80M and abandoning their creation to others. They apparently made no provisions in the contract with Apple to continue the service and protect existing Lala customers. They could have required that these existing customers continue to be provided the Lala service for a reasonable timeframe but apparently they did not. Apple was free to shut it down in what looks like 5 months.

It seems biased to blame it all on Apple.

Re:Actually a competitor sold out ... (0, Interesting)

Anonymous Coward | about 2 years ago | (#42636525)

Oh, come on, please - that's intellectual dishonesty.

Yes, apple paid for it, but they certainly killed lala, and it was certainly part of the contract. They didn't want Google to get that power, and they didn't want an iTunes competitor. Trying to wrap this in a "free market" huggy-blanket is not just naive, it's dishonest.

Re:Actually a competitor sold out ... (2)

ilicas (2799301) | about 2 years ago | (#42636577)

I think the difference between AC's position and perp's is not whether there is culpability. But where it lies. Did the Lala execs have a duty to continue to ensure good service to their customers? Did apple acquire that responsibility when it acquired the company? Did the Lala execs divest themselves of responsibility when they divested themselves of the company?

To me, at least, it is quite unclear who bears what responsibility to whom (outside of those responsibilities which are clearly delineated in contracts).

Re:Actually a competitor sold out ... (1)

Anonymous Coward | about 2 years ago | (#42636657)

It seems biased to blame it *all* on Apple.

Trying to wrap this in a "free market" huggy-blanket is not just naive, it's dishonest.

Good thing the GP did not do so. Did you miss the last line of the GP's post? I inserted it above and added emphasis to the word "all" for you.

Lala approached Apple, offering itself ... (5, Insightful)

perpenso (1613749) | about 2 years ago | (#42636733)

From the article: "He [founder Bill Nguyen] called in a few favors and got a meeting with the leadership at Apple. He explained that he had offers from the largest mobile OS competitors and that they wanted to acquire his music startup."

That is not Apple hunting down and killing a competitor. That is a company shopping itself around and playing potential buyers off of each other to maximize the sale price.

My point is that the loss of the Lala service is not entirely Apple's fault. Lala's management deserves to share in that responsibility. They chose a buyer unlikely to continue the service. They apparently did not require a commitment from Apple to continue the service for current customers for a reasonable timeframe.

Re:Lala approached Apple, offering itself ... (1)

MrEdofCourse (2670081) | about 2 years ago | (#42636799)

This.

And, Apple did incorporate the matching technology from Lala into iTunes as iTunes Match.

It seems to me like Lala was *sold* to Apple as people, IP, and customers for a service that Apple had(s) no interest in. Cutting the leads that didn't go into the iTunes store doesn't seem like that would be worth the time or effort, let alone the $80 million as Google was bound to just replace Lala with other search results.

Re:Actually a competitor sold out ... (1)

mysidia (191772) | about 2 years ago | (#42636527)

Why would they add that restrictions? Adding conditions could have reduced the profits for Lala's shareholders, by reducing the selling price.

Re:Actually a competitor sold out ... (3, Interesting)

wickerprints (1094741) | about 2 years ago | (#42636551)

Indeed. It sounds to me like the lesson to be learned here is that you don't throw out lowball offers when you have an opportunity to disrupt the market. Google made a miscalculation. Spend generously when you need to, in order to reap greater value down the line.

Now, whether that is ultimately important in light of Android's undisputed success and Apple's seeming disinterest in continuing to innovate with iOS, is another story. iOS has basically stagnated, and that's coming from someone who has stayed with Apple since the original iPhone. I've never purchased an Android device and even I can tell that it is a more flexible and capable platform.

Re:Actually a competitor sold out ... (1)

phantomfive (622387) | about 2 years ago | (#42637319)

Google made a miscalculation.

That's only true if they actually had a chance to disrupt the market. HP and Autonomy might teach you the opposite lesson.

Re:Actually a competitor sold out ... (2)

Mitreya (579078) | about 2 years ago | (#42637373)

They apparently made no provisions in the contract with Apple to continue the service and protect existing Lala customers. They could have required that these existing customers continue to be provided the Lala service for a reasonable timeframe but apparently they did not. Apple was free to shut it down in what looks like 5 months.

Is that really so simple? Does selling a company (with paying customers) free me of all my contractual obligations to these customers? If Apple sold iTunes to Google, Google would be free to shut everything down in 5 months, killing everyone's music collections??

Their customers should have sued them for everything they got in that deal...

Re:Actually a competitor sold out ... (1)

perpenso (1613749) | about 2 years ago | (#42637795)

They apparently made no provisions in the contract with Apple to continue the service and protect existing Lala customers. They could have required that these existing customers continue to be provided the Lala service for a reasonable timeframe but apparently they did not. Apple was free to shut it down in what looks like 5 months.

Is that really so simple? Does selling a company (with paying customers) free me of all my contractual obligations to these customers?

I would expect that the contractual obligations would transfer with the ownership. Perhaps Lala's EULA/contract with customers always allowed for termination of the service at any time.

This is /. (0, Insightful)

Anonymous Coward | about 2 years ago | (#42636475)

Those of us who cared knew about this when it happened, so stop trying to give history lessons and get back to news for nerds. Maybe then I'll bother to log in.

Re:This is /. (-1)

Anonymous Coward | about 2 years ago | (#42636939)

What do you mean "when it happened"? This is breaking news!

80 Million Isn't Exactly Death (5, Insightful)

Anonymous Coward | about 2 years ago | (#42636615)

The company I own is worth approximately that much, and if ever anyone offered me 80 million for it, the only part of me that would remain would be the cloud of dust dissipating where I had my last presence within its walls.

I didn't start my business because I'm "passionate" about what I do or because I "love" my work. I started it to make money, and for no other reason.

One of the biggest mistakes so-called entrepreneurs make is getting emotionally attached to their work - and I see it happen all the time in my VC club. I've been an angel for a number of startups, but we almost always turn down the ones where the pitch is not much more than how "passionate" the people are about their companies.

Re:80 Million Isn't Exactly Death (1)

Anonymous Coward | about 2 years ago | (#42636851)

Coming from a guy who runs a small business that I'm passionate about, and who is having trouble making it go how I'd like, I can't blame you for that stance.

Re:80 Million Isn't Exactly Death (0)

Anonymous Coward | about 2 years ago | (#42636907)

What's the name of the business so I can be sure to avoid it at all cost?

Re:80 Million Isn't Exactly Death (0)

Anonymous Coward | about 2 years ago | (#42637001)

Eh... either the profit motive is enough for the business to provide good service, or it will wither on the vine. Either way it's no skin off your back.

Unless they buy a congressman....

Re:80 Million Isn't Exactly Death (0)

Anonymous Coward | about 2 years ago | (#42637015)

Why would you avoid it? That is exactly the approach people should be taking in business, it is great if you enjoy what you do but ultimately a business is exists to make money otherwise you are a charity not a business. Getting emotionally attached to a business is the first mistake on the road to ruin as it clouds judgement, if you can't keep emotion separate from your business then you are asking for pain.

Re:80 Million Isn't Exactly Death (1)

Jah-Wren Ryel (80510) | about 2 years ago | (#42637077)

That is exactly the approach people should be taking in business, it is great if you enjoy what you do but ultimately a business is exists to make money otherwise you are a charity not a business.

It ain't black and white. There is all kinds of room for grey in the middle.

Personally I would rather the world were filled with millions of minor-league businesses of passion that were only sufficiently profitable to support their employees and founders in moderately prosperous lifestyles than the one we have now dominated by a relatively few amoral megacorps with no passion for anything besides money and a lottery mentality of management and investors.

Note, the OP is part of a VC club. Venture capital is antithetical to the idea of businesses of passion, its all about the business of business - product is irrelevant.

Re:80 Million Isn't Exactly Death (0)

Anonymous Coward | about 2 years ago | (#42637707)

I am sure there are quite a few people that love to work for passion. Personally I don't know any of them, everyone I know including the ones that enjoy work would happily become wealthy and then do what they truly enjoy for the rest of their lives. Business is how you pay the bills and earn the money to be able to do what you truly love, if that happens to also be relatively pleasurable then fine, if it is your passion also then great. But the world definitely would NOT be a better place if all businesses were run like you suggest. Many of the achievements of the modern world required hard nosed business decisions based on purely on profit and without those people the world would grind to a crawl.

Re:80 Million Isn't Exactly Death (3, Insightful)

Jah-Wren Ryel (80510) | about 2 years ago | (#42637751)

But the world definitely would NOT be a better place if all businesses were run like you suggest. Many of the achievements of the modern world required hard nosed business decisions based on purely on profit and without those people the world would grind to a crawl.

That logic is weak sauce all around. The best you can say using that line of reasoning is that the world would not exist the way it does today if not for the decisions that made it that way. There is no way you can say the world would be better or worse using that logic. For all you know, those hard-nosed business decisions killed off a line of research that would have produced cold fusion in the 1900s that would have averted all the world wars and made today a utopia of essentially zero-cost unlimited energy.

Re:80 Million Isn't Exactly Death (0)

Anonymous Coward | about 2 years ago | (#42637869)

Note, the OP is part of a VC club. Venture capital is (...)

Thanks for the translation, it made me wonder.

Re:80 Million Isn't Exactly Death (1)

Osgeld (1900440) | about 2 years ago | (#42637881)

as a customer I would not give a fart about someone that is in it to just sell out and crap on my interest

Re:80 Million Isn't Exactly Death (1)

bloodhawk (813939) | about 2 years ago | (#42637103)

I take the same approach with my investment portfolio, I know I am passionate about IT and hence I simply won't trust myself to invest in that market segment. Instead I research other sectors of the market that I can make investment choices where I can be certain my views are not clouding my financial decisions. If you can't divorce your business decisions from your passion then do like I do and avoid ever getting into those situations or be prepared to lose your pants.

But what if my passions is losing my pants? (0)

Anonymous Coward | about 2 years ago | (#42637775)

Where exactly do I get a job like that, that pays well, with medical?

Lala was better than iTunes. (4, Interesting)

theedgeofoblivious (2474916) | about 2 years ago | (#42636649)

I remember using Lala, mostly at work. At the time it was much nicer to use than iTunes and Pandora.

I remember the day when I found out that Apple was shutting down Lala, and I was very disappointed, because Apple is very insistent that people only use technology in the way that Apple wants them to. I do generally like Apple's interface design, but Apple is very insistent that its way is the best, and they have been insistent even in the cases that they've been wrong.

Lala had then what Amazon, Google, and Apple have only recently added, which is the ability to basically mirror your library from their website, and when Apple bought the service it was a big loss. I think Google or Amazon would have actually built on the service, but Apple just killed it, and that sucked.

But LaLa was going anyway... (1)

SuperKendall (25149) | about 2 years ago | (#42636925)

I remember the day when I found out that Apple was shutting down Lala, and I was very disappointed

Reading the article though it seemed you were doomed to disappointment no matter what. LaLa was not making money as was going to close down. I'm not even sure any of the other companies buying LaLa would have meant it would stay open.

Lala had then what Amazon, Google, and Apple have only recently added, which is the ability to basically mirror your library from their website, and when Apple bought the service it was a big loss.

That is a huge loss, I was really sad when I lost the same ability from MP3.com years before that point. I don't know that LaLa would have survived offering it for long either.

Hear E Hear E (0)

Anonymous Coward | about 2 years ago | (#42636683)

The 'Angels' at Lala.com were not so 'Angelic'; evidence reveals.

Re:Hear E Hear E (0)

Anonymous Coward | about 2 years ago | (#42636767)

FYI - I think that is "Hear Yea".

Apple shut down lala in 2010 (0)

the_Bionic_lemming (446569) | about 2 years ago | (#42636755)

Since this is a couple years ago, how is this news for nerds?

Wouldn't a story about a $30,000 NASA Contest to Boost Space Station's Power be more news than this?

Where did the nerds move to so they could get more news for nerds instead of two year old stories about apple?

Re:Apple shut down lala in 2010 (1)

Osgeld (1900440) | about 2 years ago | (#42637901)

30 grand is a small mistake in serious engineering, not a news story, they are saving money to have a reasonable and somewhat proven concept handed to them

DOLL (-1)

Anonymous Coward | about 2 years ago | (#42636769)

violated. In the You don't nned to

The shorts banked in. (0)

Anonymous Coward | about 2 years ago | (#42636781)

All the short positions already banked in at $500 a share. You can stop with the negative stock manipulation articles now.

I doubt they would have stayed around long anyway (3, Informative)

pushing-robot (1037830) | about 2 years ago | (#42636875)

I used Lala quite a bit, and in all honesty, I didn't expect it to stick around even before Apple bought the company. You could preview an entire track for free, then pay ten cents for unlimited listens with no ads and no subscription fees. With payment processing fees, servers, storage, and bandwidth, I doubt Lala was making anything, much less paying the record companies. Heck, you would have had to buy six hundred songs a year just to match Spotify's cheapest subscription. Twelve or eighteen hundred to match Zune or Rhapsody. Oh, and did I mention Lala would even scan your existing music library and then let you stream all your songs from their servers for free? Yeah, that's a sustainable business model.

I'm sure Lala was nothing but acquision-bait, like Youtube and Instagram. Offer a good service for way below cost, get a huge following, find somebody with deep pockets to buy your "community" and retire to a tropical island.

In other news.... (1)

Rick Zeman (15628) | about 2 years ago | (#42636905)

...video killed the radio star.

Re:In other news.... (1)

oodaloop (1229816) | about 2 years ago | (#42638519)

And the internet killed the video star.

Another Casuality of the Lala Acquisition: WOXY (3, Informative)

virb67 (1771270) | about 2 years ago | (#42637195)

WOXY was the single best radio station I've ever come across to discover great up-and-coming new indie bands. It was a longtime terrestrial radio station that operated out of Cincinnati. When you watch dustin Hoffman annoying the shit of Tom Cruise by incessantly repeating "97X, BAM! the futurrrre of rock-n-roll", he's repeating WOXY's tagline. The station switched over to an internet-based ad-free model in the early 2000s and got into financial trouble. Lala became the station's patron savior, financially keeping the station alive, hoping to parlay its relationship with the station into indie credibility and an instant customer base. It worked too well. When Apple bought Lala there were many that hoped the company would continue to support the station, but alas, Woxy shut down almost immediately after the purchase and has been dead ever since. RIP WOXY.

Re:Another Casuality of the Lala Acquisition: WOXY (0)

Anonymous Coward | about 2 years ago | (#42638041)

WOXY became too mainstream man....

Re:Another Casuality of the Lala Acquisition: WOXY (1)

bogjobber (880402) | about 2 years ago | (#42638661)

Have you found anything good to replace it? My local public music station just switched formats a few months ago and I find myself listening to a lot fewer new bands these days as a result.

"Paying twice was genius?" (0)

Anonymous Coward | about 2 years ago | (#42638053)

Surely getting paid twice is genius. Paying twice is just stupid.

I should go read the article...

Whd do people even care (0)

Anonymous Coward | about 2 years ago | (#42638171)

I say that because, when compared to another online service. Both apple and amazon are entirely overpriced. The site meoldishop.com has whole albums for around $1 and songs for $0.10. That's as close to pirating without being illegal.

Nguyen's choice (0)

Anonymous Coward | about 2 years ago | (#42638211)

If Bill Nguyen had wanted Lala to succeed, he shouldn't have sold it to a competitor. I think everyone could predict this would happen. He chose for cash in the short term and that is what he got. That was his choice and there is nothing wrong with that. It might not have been my choice, but then it was not my company.

Sounds more like a story... (0)

Anonymous Coward | about 2 years ago | (#42638599)

...on how to piss away $80 million.

Souldn't that read "How Nguyen killed Lala"? (1)

SilverJets (131916) | about 2 years ago | (#42638647)

He put it up for sale. Apple made and offer and he accepted. End of story.

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