AllofMP3 Outsources Marketing to U.S. Government

AllofMP3 is a Russian web service that sells digital music at very low prices without any copy protection. The service, which would clearly be illegal in the U.S. and many other countries, continues to operate apparently legally under Russian law. Our previous coverage of AllofMP3 is here.

AllofMP3 has become the center of attention in major trade negotiations between the U.S. and Russia, and appears to be the only thing stopping Russia’s entry into the World Trade Organization. Earlier this week, reports Russian newspaper Kommersant, U.S. Trade Representative Susan Schwab demanded that Russia shut down the service.

AllofMP3 seems to take the demands in stride, reportedly saying that all of the attention from the U.S. government is actually helping to spread the word about their service and increase sales. Kommersant estimates AllofMP3 revenues at $25-$30 million annually.

An AFP story says that the Russian Parliament has given preliminary approval to a new law that could shut AllofMP3 down.

Whatever the outcome to AllofMP3, the service has shown that consumers are willing to pay for high quality DRM-free music. In a time when nearly every new album (and tv show, and movie) is available for download via bittorent sites, we may see an increasing number of big labels try selling music without copy restrictions. Personally, I’m willing to pay for guaranteed quality and download speeds (neither are available via bittorent) if there is no DRM on music (allowing me to burn CDs, port the music to my iPod, etc.). And I’d much rather pay for DRM-free music than get copy protected music for free.