NEW YORK (CNN/Money) - The founder of Buy.com, a privately held online retailer, announced Tuesday that he was launching a new site, BuyMusic.com, that will offer legal downloading of music.

The launch was widely expected since news broke about Buy.com's interest in online music last week. BuyServices, a subsidiary of Buy.com, will run the online music site.

BuyMusic.com will compete with Apple Computer's iTunes, a widely successful online music site that debuted in April. iTunes, however, is currently available for Mac users only while BuyMusic.com will be available to consumers using PCs that run on Microsoft's Windows operating system. Apple (AAPL: Research, Estimates) is working on a site for PCs.

BuyMusic.com said individual songs will sell from 79 cents and albums from $7.95 from the top five record labels and thousands of independent labels, undercutting Apple's price of 99 cents a song.

The major record labels have cooperated with paid online downloading sites such as iTunes and BuyMusic.com in order to combat illegal file-swapping that takes place on popular sites such as Kazaa, Morpheus and Grokster.

Competition is set to heat up even further in the next few months once Roxio, which bought the assets of Napster, once the poster child for file swapping, relaunches Napster as a legal downloading site later this year.