END-TO-END DRM SOLUTIONS STILL ELUSIVE

IBM made perhaps biggest DRM news at show with its announcement April 8 of 2nd version of its Electronic Media Management software (EMMS). IBM floor representative Lesia Figueria said new software, to be available April 30, was expanded to provide protection not just for music files but for video and text as well. Software uses open standards including XML and Java, critical in field where no general standards have emerged. Figueria and other IBM representatives said software would work well for Hollywood studios in that it would allow studios to assign rights to individual files. IBM is entering crowded DRM market for video, which includes open-source software solution created by Cisco Systems that Cisco offers free as way to induce broadband deployment. That level of DRM has been cited to Congress by Intel CEO Craig Barrett and Intertainer CEO Jonathan Taplin as readily available, but IBM’s software doesn’t address content that escapes studio before DRM controls are added or is distributed digitally online after being converted from analog form.

That level of technology doesn’t exist, company representatives told us, with many saying it probably never would. One speculated that studios intentionally were requesting technology they knew couldn’t exist because they didn’t have business model for online content distribution. In NAB keynote, LoudCloud CEO Marc Andreessen said no DRM software solution was possible to prevent all forms of piracy (CD April 10 p6). What is available is DAM, which many consider first step of end-to-end DRM system, Artesia Vp Sebastian Holst said. Artesia was among most prominent DAM exhibitors in Las Vegas, and company published White Paper on DAM’s role in DRM. Paper said “digitization not only facilitates the quick and easy transportation of valuable information from businesses to consumers, but also facilitates the rapid free sharing of that information among otherwise potential paying customers.”

DAM already is very familiar to broadcasters, with eMotion, for example, boasting ABC and Fox Kids Europe as clients. Owners of those networks are Disney and News Corp., respectively, 2 most prominent proponents of S-2048 by Senate Commerce Committee Chmn. Hollings (D-S.C.), which would have FCC mandate DRM solution if private industry couldn’t develop one. However, Artesia said one challenge in addressing moving from DAM to DRM was that “there are many aspects of the rights management issue… it all depends on what people expect from DRM.” That variance in perspectives is why no vendor we asked felt that IT, CE and content industries could develop a consensus on DRM in one year permitted them under S-2048.

DRM also includes such back-office functions as calculating royalty and licensing payments on per-use or per- access basis, something companies such as Jaguar are pursuing (Jaguar was another company not exhibiting at NAB, but several vendors said it had software that offered similar benefits). We're told accurate accounting of royalties and licenses are key not only to monitoring use of content but to help build business model for successful distribution of digital content online. Several vendors said such features were being built into metadata -- language that’s tied to digital content and provides both a description of content and end-user’s use rights -- but successful DAM is necessary first, to authenticate users and begin tracking process.

DRM market is proving to be volatile, with some companies going under and others being acquired. For example, Grass Valley Group was privately held Nevada City, Cal., company active in DAM and DRM. Thomson closed on its $172-million purchase of Grass Valley in March. As result, Grass Valley’s exhibit floor space at NAB was left vacant except for few leather sofas. Grass Valley’s products and services were exhibited in Thomson’s space, although several attempts failed to yield someone who could speak at length about its offerings. “It’s hard when 2 companies combine,” said Thomson spokeswoman. In news release, Thomson said Grass Valley brand “was clearly an important factor in our decision to acquire the company,” with Thomson Vp Marc Valentin saying “this is an asset we intend to leverage.” However, industry insider speculated that Thomson would seek to eliminate Grass Valley brand, and at Thomson booth, words Grass Valley weren’t visible, with only occasional GV lettering appearing on side of displays.

High-tech executives have told Senate Commerce and Judiciary committees that off-the-shelf solutions exist for DRM, but consensus among engineers in industry is that, as Artesia’s White Paper points out, it depends on how DRM is defined. That same paper said that while DRM had focused on asset protection, “this space is still relatively untested, with businesses hesitant to bet their future on any one company’s technology. However, the amount of publicity that surrounds this area is proof that, while there may be no clear asset protection winner now, this technology is vital to the future of any business model that centers on intellectual property.”