Napster racing iTunes to Europe

Roxio looks to get jump on Apple

By BEN FRITZ, GORDON MASSON

After launching behind Apple iTunes in the U.S. and finding itself in a distant second place domestically, digital music store Napster is looking to beat its biggest competitor to Europe.

Company, owned by digital media software maker Roxio, revealed that it will open a U.K. version of Napster 2.0, the legal version of the service that launched the P2P revolution, by the end of the summer.

British version will be the company's beachhead for later expansion throughout Europe. It will be run by London-based VP of business development Leanne Sharman, who was widely expected to head up a European Napster when hired in January (Daily Variety, Jan. 19).

An Apple spokesman said the company plans to launch a European version of its iTunes Music Store by the end of the year, although no specific date has been announced.

In the meantime, Napster's biggest competitor will be British company OD2, which powers more than 25 digital music stores in 10 countries, including one provided by Microsoft. OD2-run stores sell tracks for 99 eurocents ($1.21) or 75 pence ($1.37). OD2 launched its digital music stores in August and sold 3 million downloads by the end of 2003.

Here in the U.S., Napster has established itself as a solid but distant No. 2 player in the market. As of February, it had sold 5 million downloads. Apple's iTunes Music Store, which launched for Mac users in April and for Windows shortly before Napster in October, had sold a total of 25 million downloads by December.

Launch of Napster and iTunes should help to expand the digital music market in Europe, where it is already showing signs of growing more quickly than it has in the U.S.

A recent sign of that was Universal Music's decision to digitize its entire European music catalog. Move will make all 300,000 of its tracks available for download and also incorporate data making it easier for the label to track royalty payments.