Tuesday, June 05, 2007

Lala has brass...

Wow. Lala, a company my classmate and friend Billy Alvarado helped start, is taking a huge, impressive gamble. $140MM committed to at least one major label, Warner Music Group, to stream (I assume) their entire catalog at 1 cent a play. At RockYou, we've been pushing the envelope with legal music streams, partnering with SnoCap, Nettwerk, PumpAudio and Fliptrack to maximize our music selection and test if music-based revenue could be material. Lala took it 1000x steps further. Congrats to Billy, Carole and the Lala team. They've taken a massive bet to test whether the free stream to paying download model works or not. Will be really interesting to watch. One standing concern is free services like Audio on Facebook, which offer completely free streams, and whether Lala can draw users away from these semi-legal/illegal streaming services much like iTunes did vs the original Napster. Really hoping Lala makes it big...


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