Today’s Question: Will Google Acquire Lala.com?

Pacman One wonders what curious machinations lurk behind the partnership that Google has formed with Lala.com in order to create its new "Google Music Search" service that embeds music players into any Google search that involves music.  

It seems reasonable to speculate that Google might have Lala in its crosshairs as a future acquisition target.  

For starters, Lala founder and CEO Bill Nguyen has a history of some half-dozen high-profile startups that have all cashed out at some point in their growth curve.  There's no reason to believe from his past history that he's got any interest in taking Lala public. 

And then there is Google's own history of acquisitiveness, not the least of which is their $1-billion acquisition of YouTube.  That put Google squarely in the web-video business.  Music on the web is even bigger than video, why would Google not want to be a player in that space?

And of course there is Google's own competitiveness.  There has been much in the news lately about the conflict of interests between Google and another big partner, Apple:  Google provides search and map functions for the iPhone, but Google CEO Eric Schmidt recently resigned from Apple's board of directors due to those apparent conflicts. 

Apples iTunes currently dominates the market for digital delivery, but iTunes has stubbornly stuck with a pay-per-download model, adhering to Apple's CEO's admonition that "people want to own their music" — which is an oddly antiquated notion for so vaunted "thought leader" as Steve Jobs.  

As a friend recently said, "iTunes is going to ride the download model all the way to the bottom."  If that's the case, then Google could take Lala out, add a subscription service, and eat iTunes' for breakfast, lunch, and dinner as music delivery moves from the hard drive to the web. 

Discuss. 



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Paul S