Apple will introduce new versions of iOS and OS X at its annual developer's conference.
Apple's Purchase Price for Lala: $80 Million? [Update: $17 Million?]
Apple ended up paying around $80 million for the company, according to multiple sources. That's less than half of what investors valued the company at in 2008, but it's more than the $35 million the company raised throughout its life. Which means that some investors could get their money back and more.The report notes that Warner Music Group had invested $20 million into Lala, but wrote down $11 million of that investment back in March. It remains unclear whether it will recoup its full $20 million investment with the sale or the smaller, post-write-down amount.
Lala reportedly possessed about $10 million in cash, meaning that it could have continued operating on its own for a significant period of time, but it appears that it sought a larger partner due to doubts about the company's ability to operate profitably as a stand-alone entity over the long-term.
Apple's exact motivation for purchasing Lala remains unclear, as some reports have suggested that Apple was primarily interested in the engineers behind Lala, while others have claimed that Apple is in fact looking to enter the streaming music business directly. Regardless of Apple's intentions, the purchase barely even dents its cash reserves, as the company reported approximately $34 billion in cash and cash equivalents at the end of its most recent quarterly reporting period.
Update: TechCrunch is now reporting that Apple's purchase price for Lala was only $17 million. Including Lala's reported cash reserve of $14 million, the purchase price would have valued the company itself at only $3 million.