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Jam Session

A band of entrepreneurs is changing the way people listen to music.

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This story appears in the September 2007 issue of Entrepreneur. Subscribe »

Vital Stats>> Bill Nguyen, 36 (r.); Billy Alvarado, 34; Anselm Baird-Smith, 39; and John Cogan III, 36; of Lala.com in Palo Alto, California

Company>> Online music company

2007 projected sales>> $10 million

Tuned in>> Introducing a modern business model to an age-old industry is no small feat. So when Lala.com unveiled plans that would revolutionize the music industry--to the tune of a projected $140 million in incurred licensing fees over the next few years--it created a lot of noise. By offering users generally unheard-of options, such as free music library hosting, direct iPod downloading for a small fee and the ability to listen to entire tracks for free, Lala.com is marching to its own beat. And by paying music labels a penny every time a track is played and pushing the sale of CDs and digital albums, the online music company is doing the unprecedented: partnering with music labels to help introduce alternative revenue streams.

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