Europes iTunes held up by red tape staggered release dates

Cue said one hurdle Apple has run into is the age-old practice of staggered release cycles, meaning some songs would not be available to all European consumers at the same time.

Marketing and distribution timetables often prevent music labels from a pan-European launch of an artist, meaning German consumers may have to wait weeks to buy what their friends in the UK are already listening to.

Yet shortly after a music single hits the radio airwaves a listener has already downloaded it on to their computer and is swapping it on a file-sharing network.

"One of the things we are working with the European labels on is to get them to understand how the business works in the online space, and having them change some of their business practices," Cue said.

While the industry has made big strides in the past year to make music available for paid downloads, the red tape is still a major gripe of the online vendors.

In Europe, the issue is more complicated than the United States as scores of national rights bodies, publishers and collection agencies have yet to agree on standard licensing fees.

The morass, both labels and online vendors agree, will make it tough for new Internet music stores to stay in business. And, the industry expects dozens of new entrants into the market this year from Amazon to German ISP T-Online.

"Until somebody gets to 50 million, 100 million, 150 million downloads per month, which by the way is not impossible, we are all going to lose money," said John Rose, executive vice president of EMI Music Group in U.S.