The U.K. subsidiary of online music service Napster has struck an exclusive retail-promotion deal with London-based Dixons Group, Europe's biggest electronics retail chain.

The U.K. subsidiary of online music service Napster has struck an exclusive retail-promotion deal with London-based Dixons Group, Europe's biggest electronics retail chain.

Napster president Brad Duea tells Billboard.biz the announcement confirms the company's confidence of launching its online service in the United Kingdom "by the end of the summer."

The new "multi-year" agreement, disclosed as Napster unveiled plans to enter the Canadian market this summer, will see Napster-branded products distributed exclusively in Dixons' 1,000-plus retail outlets.

The stores -- which trade as Dixons, PC World, the Link and Currys -- will sell Dixons' own PCs pre-loaded with the Napster 2.0 software. The retail chain will also stock Napster-labeled speakers, portable devices, blank discs and CD wallets. The promotion will include free trial subscriptions to Napster, and in-store branding.

"We will be the only dedicated online music service promoted by Dixons," says Duea to explain Dixons' in-store promotion of the dial-up software for Internet service providers AOL U.K. and Wanadoo.

"Dixons has a proven track record for driving software services through its retail channels. And because they haven't traditionally sold music, they see it as a growth opportunity for them," he says.

Future plans include selling pre-paid music cards via Dixons stores and other retail outlets. "We've enjoyed great success with these in the U.S. And given the U.K. experience with mobile-phone top-up cards, we think it is a natural extension for this market," says Duea.

Additionally, Duea expects Napster U.K. to emulate Napster's U.S. strategy of allowing customers to use Microsoft Corp.'s new digital rights management system Janus to transfer songs accessed via the monthly subscriptions to portable devices for free.

Currently, a subscriber paying a monthly fee has to pay an extra $0.99 per track to transfer songs to a portable player.

However, he declines to verify whether Napster plans to roll out into other European markets where Dixons has outlets. Those territories include the Czech Republic, Denmark, Finland, France, Hungary, Iceland, Ireland, Italy, Norway, Spain and Sweden.

Meanwhile, Napster reported revenues of $6.1 million for the three months ending March 31. This compares with the sum of $3.6 million generated from Oct. 29, 2003 -- when Roxio relaunched Napster as a legal commercial service -- to Dec. 31, 2003.

The group predicts revenues of $30 million-$40 million for the fiscal year ending March 31, 2005.