Last updated at 08:23 29 January 2008

Music fans around the world faced confusion today as it was announced they would be able to download unlimited, free songs without breaking the law.

A revamped online file-sharing service had vowed to offer a catalogue of 30million free songs that are compatible with iPods, but record labels have denied they had granted permission to share the songs.

Qtrax, which makes its debut today, is the latest online music venture counting on the lure of free songs to draw in music fans.

The key to their revolutionary venture was thought to be advertising, which they hope will pay the bills, namely record company licensing fees.

The New York-based service was among several peer-to-peer file-sharing applications that emerged following the shutdown of Napster, the pioneer service that enabled millions to illegally copy songs stored in other computers.

But Warner Music said it had not authorised the use of its tracks by Qtrax - and later Universal Music Group and EMI followed suit, saying they did not have licensing deals with Qtrax and discussions were continuing.

Justin Kazmark, a spokesman for New York-based Qtrax, has declined to comment.

To take advantage of the free but legal service, the user will need to download the Qtrax software which displays adverts while the user is searching and downloading songs.

The site was expected to feature special sections including one called "Last Night" where users can search for newly added tracks from live concerts that were recorded the night before.

It will also feature music videos, artist documentaries, interviews, album reviews and biographies among other features.

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Qtrax, which makes its debut today, is the latest online music venture counting on the lure of free songs to draw in music fans

Qtrax is not the first service to offer free songs for download with advertising support.

Last September, SpiralFrog launched an ad-supported free service with music from just one of the major record companies Universal Music. It is still in talks with other labels.

The latest version of Qtrax still lets users tap into file-sharing networks to search for music, but downloads come with copy-protection technology known as digital-rights management, or DRM, to prevent users from burning copies to a CD and calculate how to share out advertising sales with labels.

Qtrax downloads can be stored indefinitely on PCs and transferred on to portable music players, however.

The service, which boasts a selection of up to 30million tracks, also hopes that its music downloads will be playable on Apple's iPods and Macintosh computers as early as March.

iPods only play back unrestricted MP3s files or tracks with Apple's proprietary version of DRM, dubbed FairPlay.

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CDs sales are falling and file-sharing companies are satisfying the demand for free music online

"We've had a technical breakthrough which enables us to put songs on an iPod without any interference from FairPlay," said Allen Klepfisz, Qtrax's president and chief executive.

Klepfisz declined to give specifics on how Qtrax will make its audio files compatible with Apple devices, but noted that "Apple has nothing to do with it".

Qtrax downloads can be stored indefinitely on PCs and transferred onto portable music players.

Apple has been resistant in the past to license FairPlay to other online music retailers.

That stance has effectively limited iPod users to loading up their players with tracks purchased from Apple's iTunes Music Store, or MP3s ripped from CDs or bought from vendors such as eMusic or Amazon.com.

Rob Enderle, technology analyst at the San Jose-based Enderle Group, said he expects Apple would take steps to block Qtrax files from working on iPods.

It's thought Apple would be unlikely to allow tracks downloaded from its rival to be compatible with its players.