Earning economic profits in the long run requires constant innovation to ward off competitors for your profit. There is a new entrant in the online music business that just may make Apple's iTunes obsolete.
The app allows users to buy the right to stream songs from a digital locker forever for just 10 cents each. The song quality is lower than what Apple Inc.'s iTunes offers, but "intelligent caching" lets the tracks load and play in seconds, with playback possible even outside of cell phone coverage.
An existing iTunes library can be synchronized with one's Lala account, meaning a person doesn't have to repurchase songs to listen to them within the app.
Quality will indeed have to improve to have a large impact, but at about one-tenth the cost of an MP3 from iTunes, Lala is likely to be a formidable competitor to Apple's dominance in this market.
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