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. Last Updated: 07/27/2016

Legal Music Download Store to Open

Internet provider Comstar-Direct will start the country's first legal music download store this year, the company said Monday.

Comstar-Direct, controlled by billionaire Vladimir Yevtushenkov's Sistema holding, will open the store in the third quarter and expects it to become profitable next year, CEO Vladimir Malyavin told reporters.

"This will be the first legal music store on a national scale," Malyavin said. "We think there will be demand," he added, estimating that Russians spent $200 million to $300 million last year on downloads. The new service will be called Stream Music.

Russia and China were spotlighted for the second year in a row as the top violators of U.S. copyrights and patents in an annual report by the U.S. Trade Representative's office last month.

A top complaint from the United States has been the continued operation of Allofmp3.com, a popular, Russia-based, music-sharing web site, which the Recording Industry Association of America says it wants shut before Russia is allowed to join the World Trade Organization.

"We understand that we will have to compete with illegal business," Malyavin said. "But fortunately the laws are beginning to work."

Comstar-Direct will offer music downloads at a discount to European prices, said Mina Khachatryan, deputy CEO in charge of marketing. She declined to provide exact tariffs or say how much the company plans to invest in the new service or give the target subscriber numbers.