Apple could be set to dominate the market, helped by its ease of use and seamless linking with the in-demand iPod, overtaking many of the smaller services in Europe as has happened in the US, according to Forrester Research.
The firm says that Napster may be one of the few to give Apple a run for its money but it could be held back by lower brand awareness in Europe.
Forrester senior analyst Rebecca Jennings said: "In the lull before Apple and Napster get to Europe, portals like MSN and Tiscali will take the lion's share of the nascent market. They benefit from strong brand names, high audience penetration, significant marketing and cross-promotional capabilities and, in the case of ISPs, an established billing relationship."
Attempts to stop illicit downloading in Europe have failed so far. Forrester argues that commercial sites just need to be patient as the market gradually changes, boosted by the combination of legal action by the music industry and expansion of legitimate services.
Privacy laws have stopped anyone from going to jail yet but Forrester believes that the threat of a lawsuit is enough to make consumers consider legitimate downloads.
In addition, several dozen sites already sell legitimate downloads in Europe, ranging from portal offerings like MSN Music Club to retailer sites like Fnac.
As the various distributors try to establish early-mover advantage in the embryonic European commercial download market, Forrester says that the portals will take an early lead and that iTunes will do well.
Forrester also believes that the investment made by Coca-Cola in marketing, its deal to sponsor the official UK music chart, exclusive tracks, and competitions for hot tickets to events like The Brits will make its offering succeed, leaving little room left for other consumer brands.
Those tempted to enter the market, Jennings said, should pay heed to Unilever's and Procter & Gamble's ill-fated ventures into the teen portal market a few years ago with the now long-forgotten Wowgo and Swizzle respectively.
Jennings warned that retaining unwieldy, inflexible services -- such as requiring purchase of credits before songs can be downloaded -- will be hit in the longer term once easier-to-use competitors come along.
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