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Visa and Mastercard Stop Servicing AllofMP3.com
Categories: Big Media v Internet • Lobbying • New Business Models • Piracy
Both Visa and Mastercard have announced that it has stopped accepting transactions from AllofMP3.com, the Moscow-based, deep-discount, comprehensive music download service. It is the second most-used music download site on the Internet. It is popular because users can purchases songs how they want, in whatever format and bitrate they want without use-limiting DRM.
Mastercard justified this action by saying they do not "tolerate the use of its network for illegal activity." AllofMP3's notes that what it does is not illegal in Russia – and so far the Russian courts have upheld this view.
"The company believes the action taken by the world’s largest payment processors is arbitrary, capricious and discriminatory because Visa and MasterCard lack the authority to adjudicate the legality of AllofMP3’s activities and its determination that the company’s activities were illegal is patently erroneous and without legal merit. AllofMP3 has not been found by any court in the world to be in violation of any law."
"It is evident that Visa and MasterCard made the decision on factors other than legal grounds since the decision was not based on an adjudicated verdict by any court in the Russian Federation or, for that matter, anywhere in the world. To disqualify AllofMP3 based on a payment processing company’s whim is irresponsible and sets a bad precedence."
AllofMP3's immediate response was to start giving away music free to all-comers. It is considering talking legal action against the credit card companies. Some reports have said that it is considering moving to an all-advertising business model.
Dale's Comment: Despite the many actions of governments and courts around the globe, this is clearly the first real nail in AllofMP3.com's coffin. The major labels should establish a virtually identical service and charge up to ten times the price AllofMP3 charges and honest users like me would flock to their service. AllofMP3.com fills a critical need for honest music purchasers – a service where songs can be purchased where the user is not restricted as to the player she wishes to play the music on nor is she limited to the number and type of devices and services she can play her music on.
Sources: CNet | Information Week | Geek.com | Computer Business Review | Business Week | Warez | PC Pro | PC Magazine | Techwhack | Slyck | MP3.com | ars technica 1 | ars technica 2 | Forbes | afterdawn| T3
Related Posts:
- AllofMP3.com Lives On Despite U.S./Russian WTO Agreement (December 10, 2006)
- Russia Agrees to Shut Down AllofMP3.com at U.S. Request (November 29, 2006)
- Danish Court Blocks AllofMP3.com (October 25, 2006)
- Visa and Mastercard Stop Servicing AllofMP3.com (October 18, 2006)
- Russia Implements Internet Piracy Law in Gambit to Join WTO (September 1, 2006)
- BPI to Sue AllofMP3.com (July 5, 2006)
- AllofMP3.com Responds to Recent Scrutiny (June 6, 2006)
- Russia-based AllofMP3 Launches DRM-free allTunes (March 29, 2006)
- RIAA's Next Big Target: Russia (December 27, 2005)
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