London - A licensed peer-to-peer music file-sharing service is expected to launch in the U.K. by early next year, a market reaction to government pressure and the threat of legislation that would compel Internet service providers and the music industry to collaborate, The Register reported, citing music industry sources.

Issues that remain to be sorted out include the distribution of royalties, and what should be done about music that has never been licensed for digital distribution.

Such an initiative would make the U.K. the second country after South Korea, where record labels have agreed to license songs to a subscription-based file-sharing service that would tack music fees onto consumers' monthly bills for high-speed Internet.

Related Links:
http://www.theregister.co.uk/2008/06/26/music_service_provider_talks