Apple Snatched Lala from Under Google's Nose

As Google keeps on growing it's always looking at new areas in which to expand. Recently though this has meant treading even more on the home turfs of some of its, now former, close allies. This is especially the case with Apple as the two companies find themselves competitors in more and more markets. For the most part it was Google that was on the offensive but Apple has taken a clear swipe at the search giant with the acquisition of music-streaming service Lala, which was apparently heavily courted by Google as well.

The Wall Street Journal reports that Google was in late talks with Lala with the clear intention of acquiring it. The company wanted to use the music-streaming provider to bolster its new Google music offering. More than a month ago Google released a new music-focused OneBox, which enables users in the US to get direct information about a band or song and even to stream it in a pop up from the search engine itself. Google doesn't license the music itself and doesn't offer its own service, rather it partnered with a couple of providers to power the streaming, iLike, now owned by MySpace, and Lala, now owned by Apple.

The most interesting part is that Google didn't have any idea that both its launch partners would get snatched up so soon. The company is getting closer to closer to MySpace so that isn't much of a problem, but it certainly doesn't like the fact that Apple bought Lala, from under its nose, for a reported $85 million. Of course, Google may not like it but Apple definitely hates the fact that it's now working with Google, in the music market no less, one of Apple's now traditional strong points.

This isn't the first time the two companies have battled over an acquisition lately, it also looks like Apple intended to buy AdMob, a mobile advertising company that Google acquired for a hefty $750 million. This acquisition makes a lot more sense for Google as advertising is its core business but it's an interesting choice for Apple.

One motivation is trying to prevent Google from gaining too much information on its iTunes App Store. AdMob sells ads through iPhone apps so it has access to some pretty detailed stats, which could prove useful to Google as it tries to build up its own application store for Android devices. But this alone would not justify the acquisition price for Apple, so it looks like the company is also interested in advertising, a reversal of the usual trend as it would be Apple moving into Google territory and not the other way around.