Allofmp3.com held it's first online press conference today, catering to 59 journalists from 11 timezones. Bloggers were not invited, but being a journalist by trade I did manage to get my foot in the door, as did Tom Mennecke from Slyck.

The whole setup was a little bit reminiscent to an early nineties web-based text chat. But I guesss it made more sense than a phone conference, since Allofmp3s questions were translated to and then answered by Vadim Mamotin, who was introduced to us as Director General of Allofmp3's parent company Mediaservices.ru.

Allofmp3 stated that the press conference was in direct response to recent remarks of US trade representative Susan Schwab. From the chat conference:

"The company has been unfairly characterized as a pirate website. Nothing could be further from the truth. AllofMP3 is a legitimate business that is incorporated in Russia, pays taxes in Russia and pays royalties to the Russian Multimedia and Internet Society (ROMS)."

Which, of course, is what they have been saying for a long time. A lot of the statements made during the conference weren't new, and they refused to go into specifics about many things. No revenue numbers for example. Many answers also echoed the sentiment that western rights holders could get their money if they would only start a business relationship with the colletive rights management society ROMS or with Allofmp3 directly. Which they will do eventually, if you believe Mediaservices:

"We operate under Russian law, we pay taxes in Russia and we pay royalties to ROMS, the official licensing agent in Russia. ROMS has offered to pay the record companies the royalties they collected but been rebuffed. Clearly, the recording industry is trying to gain additional leverage before entering in to direct negotiations with either us or ROMS."


There were a few more interesting tidbits tho. First of all, Hollywood can relax. Allofmp3 is not thinking about offering video, or any onher digital products beside music for that matter. Allofmp3 gave also a bit of insight into the inner workings of the company. They told us they have a small team of engineers that does most of the work on the site - including the development of the online encoding process, for which Allofmp3 claims to own patents.

Allofmp3 didn't go into much details about the recent changes in Russia's copyright law. They acknowledged that authors can now exclude their works from collective licensing - but said that none of them have done so yet. Maybe because there is no easy way to opt out and no information about this process on the Allofmp3 website.

They also didn't completely rule out using DRM in the future, but don't seem to have any immediate plans to abandon the MP3 format either.

Speaking of future: Allofmp3 seems to evision dealing with artists directly in the future as record labels are becoming less and less important. Their own philosophy of the music business reads like this:

"Let's start with the fact that the record companies have little regard for the majority of musicians. They are concerned with making money for themselves, not the artists. In our opinion, we and the artists would be better off dealing directly with each other. In fact, we believe that is the future of the music industry. We think labels will fade, not disappear but fade, and that artists will have much greater freedom to actually control their work, which they don't the minute they sign their contract.
"

Artists will have more freedom, record companies will fade away. So I guess there is only one question left. Will Allofmp3 get to see this promised land, or will they be shut down in the months to come?

"Of course, we will survive. The music industry is rapidly changing and we will change with it."

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