iTunes to get a Web-friendly overhaul?

Apple may be realizing that iTunes is getting stale, and needs to embrace streaming media if it wants to stay relevant.

The Wall Street Journal reports that iTunes will soon undergo a major overhaul, with new emphasis on streaming music and cloud-based purchases instead of desktop software and downloads.

The shift in approach is related to Apple’s purchase of Lala, an online music service that lets users stream entire songs once for free and an unlimited number of times for 10 cents per track. DRM-free MP3s can also be purchased for download, and Lala can also scan your existing music library to provide free access to those songs as streams.

When Apple announced the purchase of Lala earlier this week, it didn’t say why. But the Wall Street Journal suggests that Apple wants in on music streaming. It’s important to note that Lala is not a subscription service like Napster or ZunePass, so it seems unlikely that Apple will go that route. Lala has, however, developed an iPhone app that lets you stream your online music catalog. Apple hasn’t approved it yet, but if the Journal’s report is accurate, I wouldn’t be surprised to see streaming built into the iPhone OS.

As GigaOM notes, while this is a major shift for Apple, the company’s meteoric impact on digital music suggests consumer behavior is changing. Otherwise, Apple wouldn’t be making a move like this. I think Apple is planning ahead. It sees Google looking down the road with Chrome OS to when the Web browser is practically the only component of a computer, and getting into streaming as an insurance policy.

The missing piece is video, but that seems farther off, and to my knowledge there’s no video equivalent to what Lala does. If someone builds it, perhaps Apple will snatch it up as well.