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Tuesday, May 20, 2008, 06:00 am PT (09:00 am ET)

Napster claims launch of world's largest MP3 store

In a direct challenge to Apple's dominant iTunes Store, music subscription service provider Napster on Tuesday launched a new a la carte download service filled with DRM-free tracks that are compatible with both the iPod and iPhone.

With 6 million songs, the new offering is billed as "more than 50 percent larger than any other MP3 store" and not only the "largest major label MP3 catalog in the industry, but also the largest library of independent music available anywhere."

Apple's iTunes also boasts a catalog of over 6 million songs, but tracks from the service are served up in AAC format (not MP3) and only a fraction of those are offered free of copy restrictions by record label EMI.

Other labels have thus far refused to make their catalogs available on iTunes in DRM-free format, and have instead offered that courtesy to competitive services like Amazon MP3 in an effort to curb Apple's stronghold on the market for legal downloads. However, there's little indication the strategy is paying off for the labels.

Last month, iTunes showed no sign of wear as it out-muscled Wal-Mart to to become the number one music retailer in the US with a 19 percent share. At the same time, data from Nielsen SoundScan suggests the download service also maintained a commanding lead as an online retailer, with over a 85 percent share of the market in the US and more than 50 million customer accounts.

Meanwhile, Amazon MP3, which now stands as the world's second-largest DRM-free MP3 service behind Napster, recently placed a distant fourth in the overall retail rankings, having captured just a 6 percent share of the market.

Napster said pricing for downloads on its new service is set at 99 cents for single MP3 tracks and $9.95 for most MP3 albums — about the same fees charged by iTunes. The majority of the catalog will be available at a high-quality 256kbps bitrate, and downloaded tracks will also include high-resolution album art, the company added.

The service, however, is not compatible with Apple's Safari web browser.