Apple Acquired Lala for Approximately $80 Million or $17 Million?

On Friday, we reported that Apple had acquired Lala, an online music streaming service and store. Price and details of the acquisition were not disclosed by either company. However, Peter Kafka of All Things Digital is reporting today that according to many sources, Apple paid approximately $80 million for the music service. Kafka had initially assumed that Apple had paid a “fire-sale price,” which meant investors wouldn’t get back the money they invested in the company.

On the other hand, TechCrunch’s Michael Arrington reports that the $80 million price tag is wrong. He claims his sources with indirect knowledge of the deal are informing him that in reality Lala was acquired for $17 million. $14 million of which were in cash in the bank, taking down the price to only $3 million. The real price won’t be known until Apple officially releases an statement and confirms it.

Kafka and Arrington both agree that the real reason why Apple acquired Lala was to get the talented team of engineers. We’ve also assumed that the acquisition was really to hoard all those engineers to create some web-based music service. Perhaps, an online version of iTunes, which Arrington thinks is not coming anytime soon.

Lala recently built an iPhone app, which currently is still under review. It’s not clear what Apple plans to do with it yet.