Chris Gorog, Chairman and CEO of Roxio, a company best known for its CD burning software, made the announcement at a conference yesterday. The new service will allow users access to up to 500,000 tracks by paying for individual downloads, by monthly subscription, via internet radio, or in any combination.
"Consumers want flexibility," said Gorog, "and for the first time they will not have to choose between downloads or subscriptions."
Roxio acquired Napster's assets in November last year for $5.3 million after the file-sharing service, once valued at billions of dollars, was sued into bankruptcy.
In May this year the company acquired pressplay, the subscription-based music service launched by Universal Music Group and Sony, for $39.5 million. Universal and Sony have retained a minority shareholding in pressplay, and could earn up to $6.25 million if the new Napster succeeds.
German media giant Bertelsmann previously invested in Napster to take it legitimate without success. It is currently facing a $17 billion US court action filed against it by major labels including EMI and Universal. The allegation is that by investing in Napster, Bertelsmann perpetuated its existence, and thus encouraged on-line music piracy.
The court action hit a temporary snag on Friday when the German Federal Constitutional Court refused to allow delivery of the lawsuit within Germany because delivery might be contrary to Bertelsmann's rights under the German constitution.
According to Reuters, the court said, "Delivery of the charge is on the one hand required for the lawsuit under US law, on the other hand it is required for the acknowledgment of the foreign judgment under German civil law".
It went on, "If lawsuits in (foreign) courts are obviously misused to bend a market player to one's will by way of media pressure and the risk of a court order, this could violate the German constitution".
However the ruling will only stand for six months, to give time for a full hearing to decide the issue. According to Reuters it may have little practical effect anyway, as the media company, which has assets in the US, has already formally acknowledged the action in the US courts.