DRM-related technologies are being adopted at different paces in the US compared to Europe. Some technologies are moving faster in the US, while others are behind.

Music: mobile and subscription services
The US is behind Europe in DRM for mobile content. Full-fidelity over-the-air wireless music services did not launch in the US until late 2005, whereas they have been operative somewhere in the EU for over a year previous to that.

The first actual mobile music service to launch was on the carrier Sprint PCS, with proprietary music distribution and DRM technology from the US firm Groove Mobile. Early in 2006, Verizon Wireless launched a mobile music service with Microsoft DRM technology. Apple’s heavily hyped "iTunes phone" (the Motorola ROKR handset over the Cingular network) was not an actual mobile music offering – users must download music into the device over the Internet and through a Mac or PC – and was one of Apple’s rare embarrassing market failures.

In the area of DRM-based Internet music services, the US market is experiencing growing acceptance of subscription services, which offer on-demand streaming of music from a large library for a monthly fee. The leading such services are Rhapsody, from RealNetworks, and Napster, from the company of the same name (formerly Roxio; the technology is based not on the original Napster file-sharing network but on a service called pressplay that was originally backed by Sony and Universal Music).

As more and more consumers begin to see the advantages of these services – which have no direct analogue in the physical world – Apple is getting more and more pressure to offer a subscription service of its own, despite thatiTunes is still the overwhelming market leader. Apple must upgrade the DRM model in iPods (among other things) in order to be able to support subscription services, which will raise its device cost and cut into its profit margins.

Copyright-respecting P2P networks
The other technology for Internet music that is on the verge of takeoff in the US market is the copyright-respecting P2P network. In the wake of the Supreme Court’s Grokster decision, mentioned in Part 1 of this article, P2P network providers have been looking for ways to offer file-trading services that respect copyright.

Two approaches have emerged. One enables users to trade files, but those files are protected with DRM. The most prominent example of this approach is Wurld Media’s Peer Impact. Peer Impact has licenses to music from all four "majors" (EMI, SonyBMG, Universal, and Warner Music) and various computer games. It uses Microsoft Windows Media DRM for music and Macrovision’s TryMedia DRM for games.

The basic idea of Peer Impact is to use P2P network topologies to make file downloads more efficient by using users’ machines on the network as download points. Users can contribute their PCs and Internet bandwidth and create "home pages" and email messages that highlight their favourite tracks. In return for this, they receive credits that are exchangeable for more tracks.

The other approach to copyright-respecting P2P – and the one gaining more notoriety – is one that uses a technology called acoustic fingerprinting. Acoustic fingerprinting can purportedly analyze the bits of a music track and identify it (title, artist, etc.). The idea is to let users trade whatever files they wish on a P2P network but analyze those files to "take their fingerprints." For each file, the network software looks up the fingerprint in a database and determines what the track’s copyright owner wishes to do about controlling access or charging the user. The software could substitute a DRM-protected track, offer a low-quality version of the track for free, make the track freely available (e.g., because the record label wants to maximize the artist’s exposure rather than revenue), or do something else.

The advantage of acoustic fingerprinting over the Peer Impact-style technique is that it can be used in a network that allows the trading of any files at all; those that the fingerprinting technology does not detect are assumed to be freely sharable. In contrast, services like Peer Impact can only offer tracks that record companies have pre-cleared.

Several vendors make versions of acoustic fingerprinting technology for the above and other uses. The first use of it to control access to music on file-sharing networks was actually in the UK, on the network Wippit, which uses technology from Gracenote. But Wippit was never able to obtain licenses to use major-label content with acoustic fingerprinting (it does offer major-label content, but as standard paid downloads packaged with Windows Media DRM).

Now there are two services in the US market that use acoustic fingerprinting with licensed content from major labels: Mashboxx and iMesh (the latter is actually based in Israel).

Mashboxx is a company with roots in the original P2P networks. Its chairman is Wayne Rosso, who ran Grokster when it was first sued by the music industry. It uses a music distribution platform called Snocap from a company chaired by Shawn Fanning, developer of the original Napster. Snocap, in turn, incorporates acoustic fingerprinting technology from the Content Identification division of Philips Electronics.

IMesh began as a non-copyright-respecting P2P network; it has added acoustic fingerprinting technology from Audible Magic and gotten licenses to music from all four "majors."

Both Mashboxx and iMesh are in beta at this writing, as they have been for several months. There are still unresolved questions as to whether either technology can truly stand up to large-scale production use, be accurate enough in identifying music, and be sufficiently hack-proof.

Video: enhanced DVD security and new disc formats
DRM technologies for video content in the US are advancing both for DVDs and the new generation optical disc formats Blu-ray and HD DVD. Hollywood studios have been suffering from DVD piracy, because the weak CSS encryption scheme for DVD was hacked in 1999. Since then, the motion picture industry has tried attacking DVD hacks through the legal system (DMCA 1201; DMCA 1998; cf. also Part 1), while various firms have offered technologies that augment CSS.

Forensic digital watermarking is beginning to gain traction with DVDs, particularly for discs that are only distributed to a small number of people, such as "Oscar screeners," which are given to Academy Award voters. Watermarking technologies from Philips Content Identification, Dolby Cinea, USA Video Interactive, and others have achieved small implementations.

This application of watermarking is sometimes called fingerprint watermarking (unfortunately; it is unrelated to "acoustic fingerprinting" as discussed above). Fingerprint watermarking entails embedding the identity of the recipient of the content into the disc itself. This technique does not scale very well – among other things, it is very expensive to manufacture such discs – so it is best used for limited-distribution products.

The other type of new enhanced DVD security technology is Macrovision’s RipGuard. This is a way of encoding DVDs that purports to foil DVD hacks ("ripping" DVDs into unencrypted video with the DeCSS algorithm, which was developed by Jon Lech Johansen of Norway), while preserving picture quality. Macrovision is secretive about how RipGuard works. It may work by inserting deliberate "errors" into the video data that throw off DeCSS while only minimally affecting the video quality. Disney is currently manufacturing DVDs with RipGuard, while other studios are waiting and watching to see if any consumer complaints arise about player compatibility or picture quality.

The content security designs of HD DVD and Blu-ray show that Hollywood has learned its lessons about weak encryption schemes like CSS. Playback devices for these two rival formats are just coming on the market at this writing. Both formats use a DRM scheme called Advanced Access Content System (AACS), which is far more sophisticated than CSS. Blu-ray also includes a technology called BD+, which monitors playback devices for hacks and provides for renewable encryption.

AACS and BD+ are considerably more expensive than CSS for consumer electronics makers to build in to video players. Consumer electronics vendors’ acceptance of these technologies represents a precedent-setting breakthrough for the film studios: it signifies the vendors’ willingness to spend money on strong content protection without subsidy in order to gain access to major-studio content for their new media formats.

Of course, it remains to be seen whether either of these formats will take off in the market, especially since there are two of them and they are not mutually compatible.

Home entertainment networks
The final technology category of interest in the US is home entertainment networks. The notion of the "home entertainment network" is that consumers can obtain content legitimately and then use it anywhere in their homes (or in their cars, or on their personal portable devices), while at the same time, rights holders can remain confident that all of the devices and the links among them will remain impervious to exploitation for piracy. US-based content providers are becoming comfortable with this idea. Unfortunately, the consumers aren’t – at least not yet.

In Europe, the conditional access cable television (CAS) market offers a good transition point to home entertainment networks, and most CAS vendors in Europe (e.g., Nagra, Thomson) have strategies to transition their customer bases from single-set-top-box CAS to home entertainment networking with DRM.

The problem in the US is that penetration of CAS is much lower than in Europe, and the closest thing to a home media control centre in the US market is the "home theatre receiver," which is essentially an analogue component that only accepts direct outside content in the form of traditional radio broadcasts. In general, Americans are more used to standard broadcast and cable models for obtaining video programming, even if the cable systems they are on are digital. There is no critical mass with consumers around any single concept of home networking – even though there are plenty of DRM-related standards and other technology building blocks, such as HDCP (cf. HDCP), DTCP (cf. DTCP), and CPRM (cf. CPRM), that can be combined into solutions.

Instead, at least four candidates for home entertainment networking ecosystems are emerging:

  • Microsoft, with the help of partners such as HP and Creative Labs, has been positioning its Windows Media Center as the home media network control centre, along with technologies such as Microsoft Media Transfer Protocol and Windows Media DRM for Network Devices that facilitate secure media networking.
  • TiVo has a technology called TiVoToGo, which enables transfer of video programming recorded on TiVo devices to a variety of portable devices, including Apple Video iPods, Sony PlayStation Portables (PSPs), and Microsoft Windows Media compatible players such as the Creative Zen.
  • Third-party vendors such as Mediabolic offer interoperability among various different types of devices in the digital home, such as networked DVD players, streaming music devices, and PCs. These technologies purport to include interoperability among those devices’ DRM schemes.
  • Various standards initiatives are working on DRM interoperability for home networks. The Coral Consortium (cf. Coral) is one such group that is based in the US and whose membership includes a large number of consumer electronics, IT, and media firms.

But none of these paradigms has achieved much momentum. The trouble is that most consumers don’t perceive much benefit to home entertainment networks in their current state, which is essentially complex and expensive technology that replaces cheaper, well-understood products like home video receivers and hardwire connections (analogue cables).

It is hard, for example, to convince a consumer to replace a cable TV splitter and some coaxial cable to a TV in another room with a PC or set-top box, an Ethernet or WiFi network, and an adapter for the TV that currently sells for USD 300. It is also hard to get consumers to buy their own video recorders when more and more cable TV providers are offering their own server-based PVR (personal video recorder) functionality for a modest monthly subscription fee.

The hump that electronics vendors must get over is best exemplified by a recent ad that Hewlett-Packard ran in newspapers, which was essentially an instruction manual on how to buy and use Microsoft-based HP products for home entertainment networking scenarios.

It may take a few more years until the consumer value propositions become clear and the price points become attractive. Many consumer electronics vendors are clearly depending on home entertainment networking to be the next source of high-margin revenue, now that growth in the US market for large-screen televisions is slowing down. It is in their favour that media companies are becoming receptive to home entertainment networking and that the DRM technologies appear to be ready when the time comes.


About the author: Bill Rosenblatt is president of GiantSteps Media Technology Strategies, a consultancy based in New York, USA that focuses on digital content technology issues for content providers and technology vendors. He is editor of the newsletter DRM Watch (http://www.drmwatch.com) and author of Digital Rights Management: Business and Technology (John Wiley & Sons, 2001).

Status: first posted 05/05/06; licensed under Creative Commons
URL: http://www.indicare.org/tiki-read_article.php?articleId=194