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A Behind the Scenes Look at How Steve Jobs Buys a Company

Posted in Miscellaneous, News on 26/01/2013 by Chris Hauk

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A former Color employee, Aubrey Johnson, shares two stories behind the scenes of Apple’s acquisitions of Color and Lala, both firms were founded by Bill Nguyen before Apple’s acquisitions.

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MacRumors:

Like Pandora, Lala’s music was streamed from the internet rather than stored locally. This allowed users to listen to a catalog of over 7 million songs for free as a stream over the web — much like Pandora or Spotify today. Songs could also be purchased and downloaded, typically for a lower price than iTunes was offering.

Johnson shares that Lala’s biggest strength was that thanks to a placement deal wit Google, it was at or near the top  for many searches of particular songs. This resulted in the firm grabbing sales that might normally go to iTunes. Google and Lala had also partnered together on Google’s Music service. Nokia and Google had both made offers for the firm, but Nguyen felt they were lowball offers, so he went to Apple to see if they would be interested in acquiring the company.

In late November [2009], Nguyen was seated at the dinner table in Steve Job’s home on Waverly St in Palo Alto. Also present were Eddy Cue and Tim Cook and other Apple executives. Steve led the conversation while eating a beet salad:

“I’m going to give you a number, Bill, and if you like it, let’s do it and just be done with this whole thing. Okay?” Bill agreed.

Jobs passed a piece of paper to Nguyen and Bill nodded. The deal was done.

Following the acquisition, quite a few Lala employees left millions in options on the table and followed Nguyen. Apple is said to have brought some of those same employees back when the company purchased what was left of Color, getting more experienced personnel at a significantly lower price.



Author

Chris Hauk

MacTrast Senior Editor, and self-described "magnificent bastard," Chris Hauk owns Phoenix Rising Services and writes for everyone's favorite "bad movie" website, Big Bad Drive-In.

His first Apple product was an iPod Classic 5 years ago, and he has since added a MacBook Pro, iPad, iPhone, and 2 Apple TVs to his collection.

He lives somewhere in the deep Southern part of America. Yes, he has to pump in both sunshine, and the Internet.

Don't forget to check out Chris' two latest endeavors, as the "Apple Expert" at Answers.com, and his own personal tech blog at chrishauk.com