Roxio/Napster CEO Chris Gorog is in the UK this week as the company prepares to launch its Napster 2.0 service here "before the end of summer".

Gorog spoke at the Financial Times' New Media and Broadcasting Conference here yesterday in an attempt to stress Napster's new white-hat status as the company struggles to eschew its existing reputation as a one-time haven for illegal music-sharing.

"The UK will be our first (European) entry point" he told the Financial Times. "The sooner the better," he said.

Napster UK spokesman Adam Howorth told IDG News Service that: "Pricing will be compatible with the US model of Napster."

Apple plans to launch its service in this country this year, but has not announced a date. However, music industry insiders have told Macworld that they expect the service to launch here in the second or maybe third quarter.

Apple is keeping mum: "We don't have any comment on iTunes," said an Apple spokesman in the UK. "We haven't released any information on the service, and though we are aware of the reports in the media and elsewhere, we do not comment on rumour and conjecture."

Gorog revealed that the company is "still working with labels and publishers to get all the rights sorted out. Unfortunately, it's just part of the gut-wrenching birthing process of the online music industry," he said. His stated goal is to have a localized service in each territory in the UK. "That really suggests they will not all roll out on the same day," he said.

The race is on

Mark Mulligan, senior analyst with Jupiter Research in London told IDG: "My suspicion is that Napster is going to come out just a little bit before Apple, partly because Apple has continually insisted it will launch iTunes in Europe only when it is assured it can replicate the same usage it has in the US."

He warned that both companies will have a difficult time rolling out music subscription services in the rest of Europe: "It's just too damn difficult to launch a pan-European service," he told IDG. "Agreements have to be reached in each country with rights holders and record companies, for example. And there certainly is not the same level of demand in each country."

"I think the industry right now is at a mature stage of early adoption. We clearly have not crossed the chasm into mass adoption yet," Gorog told the FT. He also attacked the a la carte distribution model Apple offers in its iTunes Music Store. Agreeing that the strength of that model is that it is easy for consumers to understand, he said: "We think the subscription model is the model for the future with the greatest financial reward."

On the format wars between services using Microsoft's Windows Media Audio software and Apple's own proprietary modified AAC codec, Gorog said: "The cloistered Apple experience is good right now in the early stages of development but I think consumers will see the serious limitations."

However, speaking to analysts from Goldman Sachs on Monday, Apple's outgoing chief financial officer Fred Anderson touched on the format war, saying Apple's partnership with HP will, "get tremendous momentum behind establishing our digital music standard AAC as the digital music standard."

"We are not going to let anyone else take our leadership position," he said.