Apple confirmed yesterday that it has purchased online music retailer Lala.com, a smaller technology company that has developed an as-yet-unreleased application for streaming songs to the iPhone. Though Apple has not provided any further information, such as how much the deal was worth or what it plans to do with this acquisition, Lala’s streaming application promised to give users the right to stream songs to their iPhones an unlimited number of times for $0.10 per song, significantly less than the price of songs on the iTunes Store; the tracks could be purchased thereafter. Apple was said to be interested in Lala’s technical expertise, including its payment and streaming technologies, rather than its specific application. The company was launched in 2006 as an online CD-trading site but relaunched in October 2008 as a music retailer.
According to a source familiar with the matter, Apple may be looking to expand iTunes by offering streaming services in addition to their traditional download model. The source, who asked not to be named, stated that “Apple recognizes that the model is going to evolve into a streaming one and this could probably propel iTunes to the next level.”