AllofMP3, the notorious Russian music-selling site, has lost its Visa account and says it will switch to giving away free, ad-supported music. The site claims that its activities are legal under Russian law. Though it may not be legal under other countries' laws for their citizens to download the music, AllOfMP3 says it has a blanket license to sell the music and no obligation to figure out what the laws are in each of its customers' jurisdictions.
The US Trade Representative has been threatening to scuttle Russia's entry into the World Trade Organization if they don't shut down AllOfMP3, but nobody in Russia seems to care much about WTO membership. Sitting on one of the world's largest oil reserves makes membership in the WTO somewhat moot — Russia will always be able to find trading partners.
AllOfMP3's new proposed business-model is a little confused. They say that they will give away free music in some kind of DRM wrapper, and force you to watch ads before you listen. But they also say you'll be able to play the music on an iPod, if you buy uncrippled music for cash.
But it seems unlikely that they'll be able to ship a working DRM (an oxymoron), and I don't understand how they'll be able to sell you the "premium" iPod versions if they don't have a Visa account — isn't that the whole problem to begin with?
The "ad-player" sounds suspiciously like the business model that Kazaa and other P2P companies retreated to after the P2P venture capital dried up in the face of music industry lawsuits — a path that led straight to spyware.
AllofMP3 said Tuesday that as of Wednesday, its business model would move toward an ad-supported distribution of free content. The company, which previously charged about $1 an album, plans to offer consumers a new software program that allows them to download any song from the site for free. AllofMP3 claims to have a catalogue of hundreds of thousands of albums, increasing at a rate of 1,000 per month.
Users of the new service will only be able to listen to songs by using the AllofMP3 software, and the songs will be usable on just one computer at a time. The interface, called Music for the Masses, will initially be available for Microsoft Windows, with an Apple version arriving in several weeks, Mamotin said.
Consumers who wish to transfer their songs between computers or to a music device like an iPod or another MP3 player, will have to pay for the music.
The idea, Mamotin said, is to make the offering attractive enough to win new customers and build a big enough community to attract advertising.
(Thanks, AV!)
Update: Michael sez, "They seem to have a couple of different end-arounds; one is at AllTunes.com (apparently a partner) and the other is at http://www.xrost.biz/ — prepaid cash cards of some description. I don't have a real hunger for music, but I do use AllofMP3.com a *lot* for my daughter's current interests. And the $25 I put on there last March goes a very long way indeed at 5 or 10 cents a track. I am considering doing an xrost card for next year's payments now, though. :-)"
