Saturday, April 02, 2005

Digital Rights Management: A War That Affects Us All

Most people don't realize the titanic struggle being waged over digital rights management (DRM). Thanks to the media, to most DRM means whether or not we can download music, and how that download can be controlled.

To basics:
Digital Rights Management – The arrangements used to manage digital rights. This includes specifying, transfering and verify rights.

Yes, this obviously touches music downloads. But it also touches digital access...to anything stored as data. So...you want to watch a movie on pay per view, buy something from an online store, look at a website, swipe your credit card at a restaurant, use an ATM, etc., etc., these uses all require particular rights, and the assertion of those rights, or the converse, denial of access by denying one's rights, or asserting that the user does not have rights to access.

The really sad part is that there are only a few big players in this space who stand to profit, at everyone's expense, Intertrust and Contentguard. Each of these entities are basically patent trolls - they make no product or service, their business model being the assertion of patent rights. Do a search...see who's hiding behind them. You'll be shocked.

The news these days in DRM is the MPEG LA and the OMA specification. If you use any part of the OMA spec, you need to pay royalties to MPEG LA. Here's some reading. Of course, who's behind the MPEG LA...Intertrust and Contentguard are the main players, followed up by Sony, Matsushita, and Philips. Intertrust is owned by Sony/Philips, and supposedly Microsoft has purchased an ownership interest as well. Microsoft controls Contentguard.

The OMA spec is being applied primarily to mobile devices, and was intended to be a royalty free standard. MPEG LA's license, 1% royalty for accessed content in addition fo $1/device is projected to bring in 100's of billions over the next ten yeas. Some project that the licensing revenue will exceed one trillion dollars over that time frame. You can bet that Consumers will be footing that bill.

The battle lines are drawn over the OMA spec. Moble providers are up in arms. MPEG LA sees money. Here's the latest.

The next area of interest is more entertainment related, namely, the Coral Consortium. It's members include Intertrust, Sony, and a bunch of entertainment giants. Coral was founded by the the Marlin Joint Development Association, and you'll never guess who's in Marlin: Intertrust Technologies, Matsushita Electric Industrial (Panasonic), Royal Philips Electronics, Samsung Electronics, and Sony Corporation.

This group bears keeping a close eye on. They're working on their spec, and we should hear soon what sort of tax they'll be imposing on us.

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