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A speedy launch of an iTunes cloud music service hasn't materialized the way many at the large record companies expected.

After Apple acquired Lala.com last December, the thinking among some music insiders was that Lala's streaming-music technology could easily be plugged into iTunes--once Apple obtained the proper music licenses. Lala.com, a music service launched in 2006 and shut down by Apple last May, possessed technology that scanned hard drives for existing music libraries and then enabled users to play back the same songs from Lala's servers via Web-connected devices. But eight months after the acquisition, Apple is telling executives at the four top labels that if Apple offers any cloud music features within the next few months, they will likely be "modest in scope" and not include the kind of functionality that Apple outlined in meetings with the labels, such as storing users' music on its servers, sources told CNET. They added that Apple still hasn't negotiated the kind of licensing deals it would need to distribute music from the cloud.

An Apple spokesman declined to comment.

What's holding things up isn't totally clear, but it certainly hasn't helped that for most of the time since the acquisition, the Lala team has worked on an undisclosed video feature instead of music, and that Apple managers, even Eddy Cue, who runs Apple's Internet division and headed iTunes for years, took a long time to specify what he wanted from the Lala guys, the sources said. Cue is close to Lala founder Bill Nguyen and was Lala's top booster within Apple.
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