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Masters of their domain - April 26, 2007

The LexisNexis Digital Rights Management Conference, co-sponsored by Content Agenda and Variety, drew about 100 top industry figures to the Four Seasons in Los Angeles this week.

Audio recordings and presentation materials can be purchased directly from LexisNexis here. I heartily recommend it for anyone interested in the DRM debate, if only for the unmistakable evidence it provides of the media companies’ absolute and unwavering commitment, at the highest levels, to the continued use of DRM.

In addition to the general counsels of Disney, Viacom, NBC/Universal, Microsoft and Google, the conference featured the chief technology officers for Paramount, Sony Pictures and NBC/Universal, and the chief IP counsels for Paramount, Warner Bros., Time Warner and Fox.

In every case, their agenda was figuring out how to make DRM more acceptable to consumers and more effective for copyright owners, not debating its merits. Valiant dissents from Steve Page of Barenaked Ladies and EFF’s Fred von Lohmann, though piquant, hardly dented the media companies’ united front.

Even Google general counsel Kent Walker, sharing a dais with Viacom’s Michael Friklas despite the ongoing litigation between the two companies, gave at least lip service to Google’s commitment to filtering unauthorized copyrighted content from YouTube.

I’ll be writing in more detail about the conference in future posts, but two broad themes emerged: DRM has gotten a bum rap as ineffective copy prevention and needs to be rehabilitated as an “enabling” technology; and the future of DRM lies in managing content at the domain level, rather than the device level.

The most well-developed pitch for domain-level management came from Sony Picture’s Mitch Singer.

“If we had developed the DVD business the way we’re developing the digital marketplace, we’d be looking at a very different DVD business today,” Singer said. “ Imagine if you bought a DVD player at Best Buy. Then you bought a DVD from Wal-Mart but you couldn’t play your Wal-Mart DVD on your DVD player from Best Buy because it only worked with DVD players from Wal-Mart.”

That sort of fragmentation of the market, Singer maintained, benefits the first mover, to the detriment over every else in the value chain.

The first mover in music was Apple, he noted, “and there’s a real risk of doing the same thing in the movie market.”

The solution, according to Singer, is to “let a thousand retailers bloom,” by moving from device-level DRM such as Apple’s FairPlay, to domain-level management.

“We need to separate the function of domain management from the storefront, sort of like Visa did,” he said.

By allowing consumers to establish credit independent of individual retailers, Singer argued, credit card companies allowed broad competition to flourish among retailers, driving down prices and making shopping seamless for consumers. The same sort of “open market model,” he suggested, could be adopted for DRM.

Consumers would establish a relationship with an independent Domain Service Provider (DSP), who would also supervise the license-based commitments and obligations associated with the DRM systems supported by various devices. Consumers would register their devices with their domain and their content could move freely among them.

When a consumer purchased a new piece of content, the retailer would send a rights token to the DSP, certifying that the content was authorized to be accessed by registered devices. The system would allow a consumer to purchase content via cell phone, for instance, and have it downloaded to their PC hard drive at home.

Domain-based management, in Singer’s view, would achieve “the look and feel” of content offered “in-the-clear,” while maintaining the chain of obligations and restrictions established through DRM licensing schemes.

A SIMILAR vision was offered at the conference by Jack Lacy, VP of Intertrust Technologies and president of the Coral Consortium.

Coral is a group of content companies, DRM suppliers, CE companies and platform providers that for the past few years has been developing the technical infrastructure necessary to achieve “interoperable domains.”

Coral’s goal, according to Lacy, is to “standardize interoperability,” rather than standardizing DRM itself.

To do that, it has developed an architecture similar to Singer’s vision, involving rights tokens and domain managers, along with a communications framework that allows domains to pass information back and forth about content usage models and rights.

The goal is to allow content purchased under one set of DRM rules by playable under the same rules on a device that supports a different form of DRM.

Much of the technical work is done, according to Lacy. The trick now will be to develop the technical and policy tools to develop Coral-based domains, and the legal framework to support compliance and conformance rules across domains.

ON A technical and conceptual level, the work of Singer and the Coral Consortium are impressive. The problem, as always, however, will be getting the global buy-in necessary for such beautifully conceived systems to actually function successfully.

We’ll explore that question in an upcoming post.

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