Lala.com to sell music for iPods

SAN FRANCISCO (AFP) - CD-swapping website Lala.com is taking a bite out of Apple's turf, hosting the iTunes music library for iPod owners and promising to soon sell songs directly for the devices.

Lala's new service lets people store their iTunes library on the Palo Alto, California company's website, allowing users to listen to their song collection from any computer via the Internet.

Lala also launched an online version of free radio that streams music to listeners on-demand.

The CD-swapping website said the moves made Tuesday are the first steps in a grand plan to break down barriers between people and digitized music and re-unite artists with alienated fans.

"The studios have done everything they can to get people to hate music," Lala.com founder Bill Nguyen told AFP.

"Sue them. Make them pay to hear it on the radio. The studios can't stop slapping us."

Nguyen derides the recording industry defense of Digital Rights Management (DRM) software, which blocks copying of music bought online, calling it the "ultimate insult."

"The last good thing to happen to music that people loved was Napster," Nguyen said, referring to the legendary dot-com era peer-to-peer music sharing service shuttered by the courts for inspiring rampant song copying.

"We wondered what would happen if we built a new Napster -- not the crappy old Napster -- with one hope that if you trust the consumer and don't think they are the enemy then you won't get screwed."

Lala has a deal with Warner Music Group to pay it each time one of its songs is played, so that studio's entire catalogue can be heard at the website, according to Lala spokesman John Kuch.

Kuch wouldn't disclose the amount, but said it is in line with the radio industry standard of a penny each time a song is played. Lala said it is negotiating similar deals with other studios.

"It is our big gamble that the more listening we provide the more you will want to own that music and make it part of your life," Kuch said.

"First by buying a CD and, eventually, with a download. This is the first iteration; we are going to be selling music to own for the iPod. That is coming very shortly."

Kuch said Lala can cut in on the exclusive relationship between iPods and iTunes because "we have some very talented engineers to make it simple to download from the Web to the iPod."

Lala's Anselm Baird-Smith implemented the first Java server at Sun Microsystems and another member of the Lala team helped build Yahoo's online e-mail service, according to Kuch.

"We want to do for music what Hotmail did for e-mail, make it ubiquitous and easy for everyone to access," Kuch told AFP.

Nguyen, a proven technology entrepreneur who has launched a half-dozen winning Internet companies in northern California, said he is backing the plan with riches reaped from his start-ups.

Lala launched in 2006 as an online vision of a vintage San Francisco record store where people tip each other off to artists, shop for freshly-released CDs and trade used ones for one dollar (0.77 euros) each plus 75 cents in postage.

Members can get as many CDs as they give and Lala is the first used music shop to send a portion of the proceeds to artists.

Swapping compact music disks is legal -- free of piracy concerns that bedevil online digital music delivery.

Lala membership has grown to approximately 300,000 people.

"We are going to make the biggest business bet we've ever done; pay the exorbitant fees to the record labels," Nguyen said.

"One simple bet, that if I show people so much music they will fall in love with it and buy it. Welcome to the new Napster."