Is Apple going Lala in the cloud?

New iPhone plus a cloud-based music service could arrive in June...

Steve Jobs has always favoured music sales over music rental, but moves by Google may hasten the launch of Apple's Lala music streaming service, says Seb Janacek.

June should be an exciting month. Firstly, the arrival of the iPad should ease ongoing tensions with the wife over access to the laptop for evening email and web access.

Second, the likely announcement of the release date for the next iPhone, recently acquired, dissected and photographed by Gizmodo should make the ongoing pain of using an iPhone 3G bearable. The remaining days of slow apps will be ticked off a wall-mounted calendar with bold red crosses.

The third bit of bright news stems from reports claiming we're likely to see the results of Apple's 2009 purchase of US music streaming company Lala. For an Apple geek, soon to be iPad owner and Spotify obsessive, this development is genuinely exciting.

Spotify has been the single biggest deal on the web for me in the last year. Other music services didn't quite make it. Last.fm was endearingly cool but you lacked the control over your playlists. Pandora was US only.

Spotify gave you access to millions of songs and all you had to do was endure an advert every 30 minutes or so. OK, so a few months later the ads became more frequent. "Hi, I'm Gina from Spotify...". "Hi, I'm Mark from Spotify...". It argues that all these tedious interruptions will go away if you give them money - also I can use the iPhone app.

The Apple iPad will make for an exciting June
(Photo credit: Apple)

Like an obedient pup I upgraded and found the ad-free experience incredibly liberating. Unfortunately, I find the iPhone app deeply flawed. Unless you happen to like being dropped out of music mid-track and being asked to log back in again.

Still for the lack of ads, it has been worth the monthly subscription fee. Now you can pay half the £9.99 and forgo the iPhone app. A few months later, it pushed the product forward again with social networking integration that allows you to laugh at your friends' music tastes and presumably lets them chortle at mine.

Also, the desktop software allows you to import your locally stored music and access everything from one place. The net result of these features is to make iTunes an increasingly peripheral program for music.

Yet, despite the sexiness of the product, iPhone app withstanding, Spotify has failed to convert the vast majority of its subscribers into paying customers.

Paying customers are what Apple is interested in. Apple has previously rejected the rental model for music and with some justification. It has stuck to its guns with its chosen model. Five billion songs and 220 million iPod sales later, who's to say Mr Jobs and co don't have had a good point?

Yet all that was before the cloud officially became a big deal and before Lala, Spotify and the like offered users a new way of accessing music - and what an exciting model it is...

Apple bought Lala in December 2009 for an undisclosed sum - reportedly to be about $80m. It announced at the end of April that the service would cease to be as of 31 May. A note on the Lala site reported: "In appreciation of your support you will receive a credit in the amount of your Lala web song purchases for use on Apple's iTunes Store."

Speculation is now growing, as it does ahead of every Apple event, that the fruits of the Lala acquisition may be revealed at the company's developer conference in June. Presumably, along with the confirmation of a new iPhone.

Steve Jobs has hinted at a big announcement at Apple Worldwide Developers Conference, and while the event is more about the developers than new products, something else might persuade Apple to show its hand - Google.

Apple's newest arch-rival announced at its recent I/O developer event in San Francisco that it had acquired music streaming specialist Simplify Media and was planning a streaming music service for its Android customers - and the customer base is growing with Android devices enjoying a surge in handset sales.

Even if the announcement doesn't come in June, the likelihood of a cloud-based music service is increasing. The company invested in a $1bn datacentre in North Carolina last year, so it's clearly planning a major infrastructure for serving data.

Apple is not going to turn iTunes cloud-only and will not stop shipping hard drives in its mobile devices and iPods. But it may well be preparing to lead its mobile and web-connected devices to the next step on the evolutionary path and the next big thing for its millions of iTunes subscribers.

Spotify has been a wonderful ride for the past 12 months or so and will hopefully port nicely to the iPad when the app is reinvented for the new device - at least more effectively than the iPhone app.

However, an Apple-designed cloud-based music service is a compelling concept. Particularly if it can find a revenue model that lets it run subscription content in tandem with downloadable content - in the age of the cloud that gives users the best of both worlds.