Lala Announces Shutdown

Lala Announces Shutdown
Any Lala users who attempted to log onto the service this morning were greeted with the following message: "Lala is shutting down. The Lala service will be shut down on May 31st, 2010. Unfortunately, we are no longer accepting new users."

This announcement comes just five months after the streaming music website was purchased by Apple. When the buyout occurred back in December, many speculated that it was because Apple was planning to use Lala's technology for its own browser-based format, tentatively called iTunes.com.

Now, by shutting down Lala, Apple presumably hopes to clear the market for its new service. Billboard speculates that part of the reason the shutdown is that staffers at Lala have been transferred to work on the new iTunes upgrade.

According to PaidContent, the reason for this restructuring is because iTunes profits have flatlined, and its "a la carte reliance looks archaic and one-dimensional, tooled for a market that's plateaued." The new service will be cloud-based, meaning that users can access their libraries online. This will encourage subscriptions rather than per-purchase downloads, with users paying a fee (likely monthly) for access to streaming music.

Over 125 million iTunes users already have credit cards registered with their accounts, meaning that the transition to a monthly subscription service could be a massive overhaul in the music market.