There's no shortage of people lambasting the recording industry for keeping their business model firmly behind the times. The ability to download music online seems to have presented the industry with a challenge it simply can't accept. They have a hammer that's been serving them well for a very long time, and by god they'll bash away at this problem even though it no longer in any way resembles a nail.
I'm not going to rehash the arguments or the history here, but needless to say, the recording industry has very firmly clung to the the premise that no matter how much money you pay, they must retain control over what you do with that music.
Enter a new business model that is doomed from the start. Lala.com presents a model that is essentially a rental scheme. I found out about this site via Slashdot and Michael Robertson. Lala has a large number of songs on it (over 5 million) that you can search, listen to from start to finish once, and then add to your playlist for 10c. Once the song is on your list, you can play it whenever you like.
Here's the catch: you can only listen to the song via the Lala website.
Ok, that's not entirely true, you can (sometimes) pay more money and buy the track in mp3 format, but the new business model Lala is going for is clearly listening to your 10c tracks via their website. They get to control everything because you stream the music. You can't put it on any devices or burn it to CD.
So why is this doomed from the start? To be fair, I'm sure there would be some people who would be happy to pay such a small amount of money to be able to listen to their music from any Internet-connected computer, but I'm not one of them.
I generally listen to music in several places using different devices. In the car, I'll listen to music on the radio, on CD, or on my iPod. At the gym, I'll listen to their music or my iPod. At parties, I'll listen to music from a stereo via an iPod, CD, or yes, a computer. And sure, sometimes I'll listen to music at home or at work from a computer. The vast majority of my music-listening is done via a little plastic disk or a little portable music device.
Now, there's some criticism of the restrictions forced upon you from online music stores like iTunes. iTunes lets you download music, but the files contain DRM that restrict what you can do with it. According to the website, you're allowed to burn it to CD as many times as you like, and copy it to as many iPods as you like. You can only put it on up to 5 computers though. Not much of a restriction - who has more than 5 computers?
Lala on the other hand won't let you burn to CD and won't let you put a track on a music device, but they'll let you play it on as many computers as you like (via their website). For me, that means I can no longer listen to my music in the car, at the gym, or anywhere without an Internet connection. That's a deal-breaker for me, and I'm sure for a lot of people.
The argument is between consumers who want to be able to purchase something without strings, and record companies who want to control their rights and insist that you're only buying a license to play the music they still own. Launching a website that tightens control over what you can do with the music is stupid. It's giving people the exact opposite of what they want. Mark my words, this idea will fail, and it will fail hard.
Update: Ars Technica, Wired, and CNet have written about this beta of Lala.com now as well. The general feeling seems to be similar to my own - they're unsure of the 10c streaming model. Also, see the comments section of this post for a reply from one of Lala.com's employees.