Times Online

The music download website whose activities threatened to scupper Russia’s entry into the World Trade Organisation (WTO) has been shut down.

The site, Allofmp3.com, was quietly closed as the Kremlin sought to end criticism from the United States that Russia was failing to clamp down on music and video piracy.

The site had attracted 5.5 million subscribers buying songs for between 10 and
20 US cents each, compared with 99 cents at Apple’s American iTunes store
and 79p in the UK.

Most customers were in Russia, but it was estimated to be the second most
popular download site in Britain after iTunes. It was set up in 2000 by six
computer programmers, who initially developed the site for their personal
use then built it into a business earning a reputed $30 million a year.

The Mp3Sparks.com site looks virtually identical and claims to offer thousands
of albums by popular artists for around 15 US cents per song. Bon Jovi’s
latest disc, for example, was on offer for $2.11.

MediaServices said that the site was registered with the Russian Licensing
Societies, which it claimed had the right under Russian law to “grant
licences and to collect royalties for the use of music without necessarily
obtaining permission from the copyright owners”.

The company’s website said that it paid 15 per cent of proceeds to the
licencing societies for distribution to copyright holders. It added that it
was considering an additional payment of 5 per cent to performing artists,
whether or not they owned the copyright, “despite no legal requirement to do
so”.