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Tuesday, June 05, 2007

Listen to Free Music On Demand at Lala (Legally)

Lala.com is making a bid at supplanting Apple's iTunes store by launching a DRM-free music store with artists from Warner Music Group. This move comes after Apple's recent switch to selling DRM-free tunes from EMI Group.

The online music service is also sweetening the pot by letting users play free tunes online. Just look for the red play button next to each album. That means you'll get to sample all the tunes you want without paying a dime. However, you won't be able to download the music to your iPod without paying for the privilege.

They are estimating that licensing fees to stream this music could run to $160 million over the next two years. Thirty percent of users are expected to fund part of this expense by buying music instead of free-loading. Of course, there are ways to record streaming music that might put a dent in this business model.

Music recommendation services like Pandora and Last.fm are definitely endangered by this move since users will be able to play music on demand through Lala, but they may add enough value with their personalization services to retain users.


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