Russia's Largest Social Network Signs Content Deal With Local TV Producer

4:14 AM PST 12/20/2013 by Vladimir Kozlov

In another step toward a legitimate online video market in the country, the two companies will share ad revenue linked to the content, which could reach $30 million in 2014.

MOSCOW -- As Russia moves closer to a legitimate online video market, the social networking website Vkontakte has signed a deal with TV producer Star Media.

Under the agreement, users of Russia's largest social network will have legitimate access to 3,700 hours of Star Media content, including the television series Anna German and Kotovsky and the documentary series Romanovy (The Romanovs).

STORY: Russian Social Network Vkontakte Eyes Deals With Online Video Services

Star Media, which is a major producer of content for the networks Channel One, Rossiya 1, NTV, Domashny and TV3, said that it shares Vkontakte's approaches to legitimate online video content. The two companies expect to profit from the deal through video ad sales. Experts estimate that in 2014, sales on video ads on Vkontakte could reach $30 million.

Until recently, Vkontakte had the reputation of Russia's "biggest online pirate" due to huge numbers of illegal videos uploaded by its users. However, several months ago, when the government tightened its grip on online piracy, Vkontakte discarded its claim about having no control over user-generated content and began negotiations with rights holders.

Several weeks ago, Vkontakte reportedly entered negotiations with the online video service RuTube, owned by Gazprom Media.

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