RIAA asks AllofMP3 to Come Clean…
October 17, 2006
Thomas Mennecke

AllofMP3.com, the questionably legal music download store, has operated in the Russian Federation with relative impunity since its inception. Although the RIAA, IFPI, US Trade Representative and Russian Prosecutor’s office have all tried to reign in this music store, all have yet to achieve their goal.
Even with the Russian government impeded from entry into the highly coveted World Trade Organization (WTO), AllofMP3.com still appears to operate without fear of legal action. Over time, AllofMP3 has grown in popularity on a global scale. Its low prices (about 3-10 cents per download), wide variety of file formats, superior selection, and lack of DRM (Digital Rights Management) have allowed this store to grow beyond expectations.
As AllofMP3 has grown into international prominence, it can no longer shelter itself in silence. In fact, over the last two weeks, AllofMP3 has publicly countered the claims of the entertainment industry and US Trade Representative. Two new developments have occurred in the last two days that further places more attention on AllofMP3 and their claim of legitimacy.
Yesterday, AllofMP3.com announced today's press conference. The press conference, which is taking place at the time of this writing, is being attended by dozens of journalists from publications such as Ars Technica, USA Today, and the Associated Press.
Prior to the press conference, the RIAA (Recording Industry Association of America) issued a press release that once again challenged AllofMP3. However this time, the RIAA raised the bar, and challenged AllofMP3 to admit what it does is “illegal.”
“Allofmp3.com sells and distributes hundreds of thousands of songs by international and local artists without having any legitimate license to do so. It claims to be licensed by a Russian-based society ROMS, but ROMS has no mandate from international rights owners to license the site in or outside Russia,” the RIAA said.
The RIAA then followed up their press release with
four questions for AllofMP3.com; which focused on revenue, justification of their business model via ROMs, lack of royalty payments via ROMs, and ability to comply with copyright laws outside of Russia.
Questions presented by journalists centered on similar issues, and one journalist reprinted the RIAA/IFPI’s questions in their entirety. However when asked about revenues, AllofMP3 responded, “We are not disclosing financial details during this conference.”
When asked to comment on the RIAA/IFPI press release, AllofMP3 said, “The truth is that US Trade Representative Schwab knows that isn't true. The US government is conveniently using AllofMP3 as an issue to gain further concessions from Russia.”
Although AllofMP3 previously hinted at working out an arrangement with the entertainment industry, the tone of the press conference was notably defiant. AllofMP3 refuted any claims of illegality, and repeatedly stated their operation was compliant with Russian law. They also state that all royalty payments, or 15% of AllofMP3’s revenue, are delivered to ROMs.
ROMs (Russian Organization for Multimedia and digital Systems) licenses online stores, and, according to AllofMP3, collect royalty payments. These payments are then theoretically distributed to copyright holders.
The entertainment industry however refutes this claim. The RIAA and IFPI have repeatedly stated they have yet to see any payments from AllofMP3, or from ROMs.
During the press conference, AllofMP3 insisted that all lawful payments have been made. If this is the case however, why hasn’t the entertainment industry seen it?
That very question was asked numerous times. However, AllofMP3’s answer was consistent – they are not responsible for payments once ROMs collects the royalties.
“We can't control what ROMS does. However, we want to be very clear that we have encouraged ROMS to distribute the royalties. Clearly, it is in our best interest, as well as the musicians, that ROMS distribute the royalties to the record companies.”
It appears the “AllofMP3.com versus the music industry” is a fight that shows little sign of abating. AllofMP3.com has dug in, and appears ready to defend itself. The music industry will likely continue to pressure the Russian government – yet considering the length of time AllofMP3 has remained online, a quick solution remains fluid at best.
This story is filed in these Slyck News categoriesUnauthorized Distribution :: AllOfMP3.comEntertainment Industry :: RIAADigg this article.You can discuss this article here - 30 replies