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Apple (Nasdaq: AAPL) is shutting down Lala, the online streaming music service it purchased last December, fueling speculation that it may be moving the iTunes store, or some variation of it, to the cloud.
Such a move would allow users to access music from any device with a Web browser. Currently, iTunes users must download songs to a computer's hard drive before transferring them to a mobile device such as an iPod or iPhone.
Apple also requires users to purchase songs at roughly US$1.00 and up. Under the Lala model, users had the option of paying 10 cents for the right to listen to a song an unlimited number of times over the Web, or purchasing and downloading MP3 versions of songs to their computers or other devices. Customers also could create music libraries and store them on the Lala site.
iTunes Credit
All that will end soon, however. On Friday, visitors to the Lala site were greeted with a message saying the service will be shut down May 31. "Unfortunately, we are no longer accepting new users," the notice said, while inviting current members to log in for more details.
Upon logging in, users were told any money they have spent for streaming songs or gift cards could be converted to credit toward purchases at the iTunes store or cash refunds.
Apple declined to comment to MacNewsWorld on whether it was simply shutting down Lala or if it planned to use its assets in some other form.
That is Apple's normal stance when it comes to speaking about companies it has acquired or plans to acquire. However, the silence surrounding its intentions for Lala has not quelled speculation that Apple might launch its own streaming music service.
Emotional and Financial Investment
If Apple takes that direction, what does that mean for the future of online music? Will the concept of consumers owning music be a thing of past?
Not likely, at least not in the immediate future, said Sonal Gandhi, media analyst with Forrester Research.
"In order for people to stop buying music, they will have to have faith that the service provider will not go away," Gandhi told MacNewsWorld. "We've already seen a couple of these providers shut down. Even if people haven't spent money with these providers, they have engaged with them by building their music libraries, and they won't want to lose that."
Like everyone else, Gandhi said, "I don't know what Apple is going to do, because Apple doesn't talk to anyone -- but maybe they can get people to join a music streaming site just because of the 'Apple' name."
