Record company EMI is to make 140,000 tracks from 3,000 of its artists available for download, and will sell new singles on the web before they hit the shops.
Users of the service, which is expected to go live within weeks, will pay an estimated 80p to £1 per download, or around £10 for an album.
Some new releases from EMI will be available online up to three weeks before reaching high street retailers.
Artists covered in the deal include current stars Kylie Minogue, Robbie Williams and Norah Jones, as well as the Beach Boys, David Bowie and Pink Floyd.
"EMI has a vast digital catalogue and is now providing users with the music they want in a way that is faster, safer and more adaptable [than] any of the current services. And it's legal," said Tony Wadsworth, chairman of EMI Recorded Music, in a statement.
Not all EMI artists are happy about being included, however. One notable absence will be The Beatles, whose representatives are still to agree terms for internet distribution.
The move comes as the record industry faces declining revenues from sales of singles and failing interest in the Top 40.
File-sharing services such as Kazaa and Grokster are still operating, with millions of users worldwide unlawfully downloading music for free.
Having already scored a victory against file-sharing pioneer Napster, record companies are continuing to target such companies in the courts.
The Recording Industry Association of America has launched a round of lawsuits against four US students who it accuses of sharing thousands of copyrighted songs and operating "a sophisticated network designed to enable widespread music thievery".
The EMI scheme will allow users to burn tracks to CDs as well as copy them to portable music players.
Singles will be available online at the same time as they are released to radio stations, in advance of their release in the shops.
Customers will be able to buy songs from 20 European websites including HMV, Freeserve and MSN, with more expected to sign up in the future.
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