Last week VKontakte (VK.COM), the leading social network in Russia and a property of LSE-listed Mail.ru Group, announced the settlement of its legal battle with Warner Music Group (WMG) through a confidential out-of-court agreement.
Under the agreement, VK users will be provided with legal access to WMG content though UMA, a Russian supplier of music content, and other authorized platforms.
The parties will not continue their disputes in court.
“VKontakte continues to move towards the development of cooperation with record companies and other rights holders. This agreement is another milestone in this direction,” VK’s CEO Boris Dobrodeev stated.
“We see huge potential for growth of our business in Russia, further investment in Russian artists, when artists and rights holders receive fair compensation These agreements mark a major step forward on the way to a properly functioning market,” Warner Music Russia General Director Alexander Blinov said.
In March, Universal Music and Warner Music suffered a major legal defeat when an appeal court in St. Petersburg overturned an earlier ruling that VK must implement effective technology to stop infringements on its service.
A long-running copyright battle
Even as Russia was putting together its August 2013 anti-piracy law – focusing essentially on video content – VKontakte kept potentially litigious tracks on its website. Just over a month ahead of the adoption of the law the social network stated that “nobody can ban others from listening to something.”
However, VKontakte also made moves to mollify international concern over piracy. Thus in July 2013 the company entered talks with Sony Music, Warner Music and Universal Music, which had previously filed lawsuits charging the website with copyright infringement.
In the spring of 2014, the three majors filed a new lawsuit against Vkontakte. Together, they sought 51 million rubles (around $1.5 million at that time) in compensation. Other lawsuits have been filed over the past few years with various outcomes.
In July 2015, Vkontakte and Sony Music Russia reached an undisclosed settlement. The Russian media reported that the agreement provided for guaranteed payments to copyright holders, and a profit-sharing arrangement.
VK is holding discussions with Universal to settle their still-pending dispute, Vedomosti has learned from sources with knowledge of the matter. The companies are considering a three-year licensing agreement amounting to some $10 million.
