Russian copyright holders are suing Mail.Ru Group because of licensing fees for music

Small Russian labels are dissatisfied with the Mail.Ru Group approach to withdrawing from the shadow of the most popular section of the Vkontakte social network - audio recordings. Representatives of the labels themselves told about this to Vedomosti.

The stumbling block between domestic labels and the Internet giant has become guaranteed minimum payments for the use of musical compositions. Earlier, Mail.Ru Group has taken steps to legalize audio content in its social network VKontakte. Then an agreement was reached on the payment of rewards to a number of major labels. Among them are foreign Universal Music, Sony Music, Warner Music and the national “First Music Publishing House” (PMI).

These four labels receive guaranteed payments from Mail.Ru Group for using their music. The agreement with the copyright holders in Mail.Ru went after the social network "VKontakte" got into the list of pirated websites of the US trade mission. Musical labels, which characterized the social network as the largest Russian pirate music service, played a significant role in this. After that, Mail.ru Group agreed with the copyright holders on the payment of license fees.
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Smaller labels did not fall within the framework of the agreement and are now suing the social network. The first lawsuit on blocking “VKontakte” was filed by Moroz Records, which owns the rights to the songs of the groups “Kino”, “Sounds of Mu”, “Cruise” and performer Mikhail Zvezdinsky. The Moscow City Court pleaded guilty to the social network and decided to immediately block it before filing a lawsuit on the merits. However, Roskomnadzor did not find controversial audio recordings and did not comply with the court’s decision.

Moroz Records is going to achieve blocking "VKontakte", which does not pay license fees to them. Label management says that even though the administration removes the controversial audio recordings, users can easily download them again.

The social network makes guaranteed payments only in favor of large players ($ 8 million for three years only for the very fact that there is music in the social network. Ed.) While ignoring the small domestic music labels. It is necessary to understand that “VKontakte” does not refuse to pay in full: the amount of deductions for each audition does not suit the right holders, since the major players receive much more.

“UMA (the company negotiating with labels on behalf of Mail.ru Group approx. Ed.) Is ready to pay us deductions from playing each track, but these are amounts that are not comparable to those received by large market participants. We are not ready to work under such conditions, ”Valeriya Grishin, Megalineer General Producer commented on the situation. “We fear that if UMA works with labels under different conditions, then VKontakte and other Mail.ru Group projects will primarily promote the music of those companies that are paid the most, just to discourage these investments,” she continues.

The representative of "VKontakte", close to the negotiations, argues that the share of small labels in the audio recordings of the social network is less than 10%, but they require the same conditions as the major players - millions of guaranteed deductions for each artist. The social network does not agree to such conditions, but it was not possible to reach a compromise with the right holders.

Now the owners of small labels are studying the judicial experience of Moroz Records and are preparing their own suits for the social network.