Allofmp3 Restarts Business

An anonymous reader writes "With a pretty short message on their blog, Allofmp3 announced that they will resume their music store soon. According to a Russian court, their music store did not violate any copyright law in Russia, so there was no reason for them to keep it closed."

Comments

Legal nuance

[Sunburnt]

According to a Russian court, their music store did not violate any copyright law in Russia,

Ha! Silly Russians! In Capitalist America, copyright law violates YOU!

Re:Legal nuance

[hackstraw]

The new U.S. law will probably make it illegal to download music from and site hosted in a country that is not in alignment with U.S. IP laws.

Why stop at music? Why not all "intellectual property"?

That will in effect make much of the internet "illegal" which would probably be a good thing, because then we will have the choice as to which laws we want to follow. Funny, isn't that how multinational corps work?

And lo the beginning of the IP Cold War...

[Anonymous Coward]

Russia has been flexing it's muscles lately in many fields, to re-establish itself as a power in the world. I would not be surprised if this is part of that muscle-stretching exercise.

Then again it could also just be a case of IP laws not synching up between Russia and elsewhere in the world.

Re:Global Economics

[Sunburnt]

I wonder if this is how foreign nations plan to break the U.S., by bootlegging our digital commodities and harming our most influential industry?

What, exactly, does this have to do with the defense industry?

If you can't beat em', join em'

[Anonymous Coward]

Maybe finally the RIAA will realize that allofmp3's pricing scheme and business model works and proves that if you price it right and don't use DRM, people will readily pay for music even if it is available for free on P2P.

allofmp3 provided/provides:
A great rating/linking system - "People who bought this also bought...","Similar artists..." - Great way to get "the word" out on new music without any advertising costs whatsoever.
Convenience - No DRM, no "special" download app that tied you to Windows (even if just for downloading). (Yes, there was allTunes, but you could always just download using a normal old browser)
Selection - allofmp3's selection was better than any other online music store I've used, except possibly for iTMS, although due to the DRM I haven't touched iTMS since PyMusique/SharpMusique stopped working.

They also happened to have great prices, but I'd happily pay double the prices of what allofmp3 charged.

Rather than try and sue them out of business, the RIAA should instead drive them out of business the capitalist way - with some nice good competition. Offer the same selection, convenience, organization, and interface as allofmp3, and compromise prices between allofmp3's (admittedly too low) and the RIAA's (way too high for "impulse buys" of tracks/albums I'm not sure about.

While the per-track/per-album price of allofmp3 is much lower, many people (myself included) spend MUCH more money in total there because at allofmp3's prices, there is little risk to buying a whole album as an "impulse buy" when you came for just a single track. RIAA pricing encourages single-track purchasing (odd, since the RIAA is so desperate to encourage full-album purchases.)

Re:If you can't beat em', join em'

[Sique]

And according to the russian court, they were paying their suppliers (or at least the representatives of their suppliers) rightly.

Re:If you can't beat em', join em'

[FauxPasIII]

> You can price anything right if you choose not to pay your suppliers.

... but enough about the RIAA.

Re:If you can't beat em', join em'

[Andy Dodd]

Have you seen the breakdown of who gets what from albums these days?

Despite the high prices for the consumer, the supplier (artist) gets almost nothing.

Current track prices are way too high ($1.30 for usable content with an incredibly limited selection), and while allofmp3's were too low (10-25 cents/track depending on length and compression), a compromise somewhere between the two (maybe 50 cents for no-DRM) would likely be quite successful.

They could even reduce advertising budgets significantly and simply use the "similar artists" and "people also bought x" features that most good online stores have nowadays.

Re:If you can't beat em', join em'

[Klaruz]

Allofmp3 payed ROMS, but the RIAA's russian branch (IFPI) refused to take payment.

http://blogs.allofmp3.ru/music_news/2007/08/27/ifp i-refused-to-recieve-royalties-in-russia/

Re:If you can't beat em', join em'

[Fallen Kell]

Again, included in their current price is the costs that they have to legally hold aside and give to ROMS when they sell a track/album. The money is already in ROMS hands, they have already collected it. And in ACCORDANCE with LAW! Just because the RIAA and IFPI (which is the new extension) do not like the law doesn't mean that they can do anything about it in the way they are trying (i.e. get the World Trade Unit, and the European Union, and the USA to force Russia to shut down a perfectly legal business by mandating that Russia will not be allowed to join the European Union until it shuts these places down, because they already tried to lobby for the laws to change and failed (it appears that the Russians are not a susceptible to "contributions" as their American and European counterparts)).

They are abiding by their laws as written. ROMS is the legal entity to send copyright payments to under Russian law. ROMS is setup to pay the appropriate copyright royalties to the proper owner(s) when officially notified by the proper owner(s). The check then goes in the mail (and future payments go in the mail as they arrive). They simply have a system in place to make sure the proper owner of the copyright is compensated, and not someone with the false claim to the copyright, and this is in accordance to LAW. Stop complaining that you don't like it. I don't like the fact that women in Saudi Arabia need to keep their heads covered, but that is the law in that country. Same thing with no being able to chew bubble gum in Singapore...

Re:If you can't beat em', join em'

[flink]

Current track prices are way too high ($1.30 for usable content with an incredibly limited selection), and while allofmp3's were too low (10-25 cents/track depending on length and compression), a compromise somewhere between the two (maybe 50 cents for no-DRM) would likely be quite successful.

I wouldn't say that allofmp3 prices were too low. At $0.03/MB, a 3:30 FLAC song weighs in at 22.5MB/$0.67 and a ~62 minute album is 417MB/$12.51. I can walk into Newbury Comics and get most albums on CD for $10 to $14. Buying music online should be cheaper for the consumer, not just more profitable for the distributer, who doesn't pay any of the costs associated with physical media. $1.30 per track on iTunes is outrageous.

(Part of this post was recycled from this one)

Re:If you can't beat em', join em'

[mrchaotica]

Don't be daft. It's more like you come into my store and offer me $0.01 for a case of beer, and I refuse, and you walk out of the store with the beer anyway.

No, it's more like he walks into your store and offers you $0.01 for a case of beer, you refuse, a passing police officer reminds you that the $0.01/case price is fixed by law and declared to be fair , and he walks out of the store with the beer.

You can't just name your own terms/price

AllOfMP3 didn't! The Russian government named its price, and AllOfMP3 complied.

Conversely, the RIAA would have a rather hard time going after allofMP3 for copyright infringement...

...and that's exactly the way it should be, since AllOfMP3 wasn't committing it, according to Russian law -- which, incidentally, is the only law that matters in this discussion, whether you like it or not!

Re:If you can't beat em', join em'

[Alsee]

You equate the Russian law to illegitimate legalized theft, however the Russian law involved is largely identical to US law in principle and operation.

Both US law and Russian law grant a statutory license for any company to send absolutely any music over the internet, both US law and Russian law say that music may be sent in any format (including MP3), both US law and Russian law grant permission to do so without the permission of the copyright holder - or even to do so against the express dis-permission to do so from a copyright holder, both US law and Russian law designate a national collective body to receive the payments and to distribute those payments to the copyright holders, both US law and Russian law dictate what those royalty rates will be.

For example Pandora.com is a US company operating under that largely identical law and sending MP3s to people perfectly legally.

So what *is* the difference between US law and Russian law? Well there are basically two significant differences. US law has a couple of restrictions trying to prevent it from looking like a "store". If someone requests a specific song, you must wait at least an hour before sending it. You can't announce what music you are going to send. You can't send more than three songs from the same artist or two songs from the same album within any given hour. Probably one or two other quirky rules. But largely it boils down to that first rule - if someone wants to in effect "buy" a specific song download you have to wait at least an hour before initiating the transfer. Oh, and US law says the company can't *TELL* you that they sent you a download. Yeah, the good old "lets close our eyes real hard and pretend the facts of reality don't exist and maybe they will go away". Pandora.com "looks" like a "streaming" radio, and they don't *tell* you they sent you a 128kbps MP3 file download. But they did. If you take a look in your system temp folder, all the MP3 files are sitting there. They are named "Access-1" and "Access-2" etc, and they have no file extension. You just rename the file and tack on the .MP3 extension and there you go. Of course if we all close our eyes real hard we can pretend that there actually is any technical difference between a stream and a download, and we can pretend that MP3 file isn't sitting there on your harddrive, and if we squeeze our eyes shut REALLY REALLY HARD AND NO ONE PEEKS, then in a week or so the operating system will automagically delete all of the downloaded MP3 files sitting in your temp folder and *poof* the download never actually happened! Closing our eyes worked!

Oh wait.... I almost forgot. I said there were basically TWO differences between US law and Russian law! It wouldn't be very fair at all for me write that rather long paragraph on the first difference and then quietly exit without telling what that second significant difference is, now would it?

Well the other difference is the different royalty rates. Yeah, I guess I have to admit that is a pretty important difference. Not just an important difference, but a LARGE difference. In fact it works out to about twenty times difference in royalty rate. Yeah, a twenty time difference in money for the artists isn't even even in the same ballpark. Russian law and US law don't set anywhere near the same payments for artists.

Oh wait... I think I might have been a bit unclear there on the difference between US law and Russian law, and particularly about those royalty rates. It's Russian that sets a twenty times higher payment rate for artists, and it is US law that sets twenty times lower payment rate for artists. Sorry if maybe you got the impression it was the other way around :) Those damn evil Russians allowing sending of MP3 files over the internet without the copyright holder's permission on the exact same statutory license legal basis as US law allows sending of MP3 files over the internet without the copyright holder's permission, and then Russia having the audacity to

Never stopped doing business...

[spookymonster]

...just changed names for a bit (to MP3sparks.com). I had a balance on AllofMP3, heard that 'sparks was a front, so I logged on using my 'MP3 ID and, sure enough, they'd "transferred" my balance. And guess what? Alltunes (their download tool) never stopped working either, and without me having to change a single setting.

Domain blocked in Denmark

[threaded]

Bored one day I was using Google to find a ringtone for a friend and happened to drop on AllOfMP3, (just clicking through the list as one does,) and was presented by a page from my ISP saying it was blocked. I found it a little disconcerting that my ISP is deciding who I can communicate with.

For a moment I thought it's no longer the net I grew up with.

As I wasn't particularly interested in finding the ringtone or going to AllOfMP3 anyway thought I'd alleviate my boredom by investigating how they'd done this. Turns out they've only poisoned their DNS. So if you get the correct IP address from somewhere else and stick it in your hosts file you can work around it.

So the net returned back to normal: identified censorship as an error and routed 'round it.

Whew!

Not very many comments here yet...

[ElNotto]

Everybody must be busy downloading MP3s!

corporations taste of it's own medicine?

[mseidl]

So, it's ok for big corporations to off shore things like manufacturing + tech support to cheaper countries.

But when another company takes advantages of its laws and it effects the company here. Oh noes!

Re:So, you're essentially paying a pirate money, h

[Kristoph]

You know, actually, allofmp3 does pay royalties in Russia to ROMS (an agency setup under Russian law by the Russian government). The issue is that western companies do not recognize ROMS and instead 'demand' that Russian media companies deal with the equivalent of the Russian RIAA.

So what he is doing here is supporting an organization which is battling the influence exerted by the RIAA while legally distributing DRM free music.

Admittedly, there is a question of whether the amounts involved adequately compensate artists but, honestly, is not virtually any system better than what the RIAA promotes.

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