DRM from Wikipedia

Digital Rights Management

Digital Rights Management (generally abbreviated to DRM) is any of several technologies used by publishers (or copyright owners) to control access to and usage of digital data (such as software, music, movies) and hardware, handling usage restrictions associated with a specific instance of a digital work. The term often is confused with copy protection and technical protection measures (TPM). These two terms refer to technologies that control or restrict the use and access of digital media content on electronic devices with such technologies installed, acting as components of a DRM design.

Digital Rights Management is a controversial topic. Advocates argue DRM is necessary for copyright holders to prevent unauthorized duplication of their work to ensure continued revenue streams.^[1] Some critics of the technology, including the Free Software Foundation, suggest that the use of the word “Rights” is misleading and suggest that people instead use the term Digital Restrictions Management.^[2] The position put forth is that copyright holders are attempting to restrict use of copyrighted material in ways already granted by statutory or common law applying to copyright. Others, such as the Electronic Frontier Foundation consider some DRM schemes to be anti-competitive, citing the iTunes Store as an example.^[3]

Enterprise Digital Rights Management (E-DRM or ERM) refers to the use of DRM technology to control access to corporate documents (Word, PDF, TIFF, AutoCAD files, etc), rather than consumer playable media. The technology usually requires a Policy Server to authenticate users’ rights to access certain files. EDRM vendors include Microsoft, Adobe Systems, EMC Corporation/Authentica and several smaller companies. There are open source implementations as well. EDRM is generally intended to apply to trade secrets, which are much different from copyrighted material (though there is sometimes an overlap with material being both copyrighted and a trade secret — eg, source code of proprietary software), and for whom the primary issue is industrial or corporate espionage or inadvertent release. In most jurisdictions, there is no notion of fair use of trade secrets as there is for copyrighted material. Trade secrecy confidentiality measures are less controversial than DRM applied to copyrighted material, which is commercially sold in many copies.

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Introduction

DRM vendors and publishers coined the term digital rights management to refer to the types of technical measures discussed here, applying it only to digital media (and analog media that has been released in digital form). There is a long history of objection on the part of copyright holders (often music distributors or broadcasting companies) to copying technology of any kind. Examples have included player piano rolls (early in the 20th century), audio tape recording (after WWII), video tape recording (eg, in the famous Betamax case in the US), etc. Digital copying raised concerns to a higher pitch. While analog media loses quality with each copy generation, and often even during normal use, digital media files may be copied an unlimited number of times without degradation in the quality of subsequent copies. Digital Audio Tape, thought by many observers of the time to be a probable replacement / improvement for the audio cassette, was a market failure in part due to opposition on grounds of the potential for piracy. The advent of personal computers, combined with the Internet and popular file sharing tools, have made unauthorized sharing of digital files (often referred to as digital piracy) possible and profitable.

Although technical controls on the reproduction and use of software have been intermittently common since the 1980s, the term DRM has come to primarily mean the use of similar measures to control artistic works or content. Beyond the existing restrictions imposed by copyright law, most DRM schemes are able to enforce additional restrictions at the discretion of the content’s publisher, which may or may not be the same entity as the copyright holder.

DRM may be enforced by numerous technologies, such as special modifications to digital media player software. Since such implementations can be reverse engineered, they are not effective as an inherent part of the design. This fact has resulted in a general move toward Mandatory Access Control systems (as opposed to Discretionary access control) wherein usage restrictions are enforced by software buried in hardware, working with software provisions in operating systems, media playing software, or both. However, some implementations of this type of DRM are vulnerable to an additional class of attacks, due to a requirement to run on tamper-resistant hardware. There has been pressure (largely successful) for legislation and regulation creating new offenses (ie, controlling or prohibiting examination of DRM schemes, or possession of any tools (eg, software) which might interfere with the operation of a DRM scheme.) An example is the DMCA.

While digital rights management is most commonly used by the entertainment industry (films and recording), it has found use in other media as well. Many online music stores, such as Apple’s iTunes Store, as well as certain e-books producers, have adopted various DRM schemes in recent times. In recent years, a number of television producers have begun demanding implementation of DRM measures to control access to the content of their shows in connection with the popular TiVo system, and its equivalents.^[4]

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Content Scrambling System

An early example of a DRM system is the Content Scrambling System (CSS) employed by the DVD Forum on movie DVDs since circa 1996. The scheme used a simple encryption algorithm, and required device manufacturers to sign a license agreement restricting the inclusion of certain features in their players, such as a digital output which could be used to extract a high-quality digital copy of the movie. Thus, the only consumer hardware capable of decoding DVD movies was controlled by the DVD Forum, restricting the unauthorized use of DVD media until the release of DeCSS by Jon Lech Johansen in 1999. An unsuccessful variant of this scheme is the now-defunct DIVX format.

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Legal enforcement of DRM

Digital Rights Management holds an uncertain legal status in most countries, as the rights of users and producers regarding content are rarely defined clearly enough currently for the legal situation to be widely agreed upon. In most countries, particularly those without a fair use doctrine, users’ ability to use copyrighted material is ill-defined and so difficult to enforce.

The 2001 European directive on copyright forces member states of the European Union to implement legal protections for DRM. In 2006, the lower house of the French parliament adopted such legislation as part of the controversial DADVSI law, but added that protected DRM techniques should be made interoperable, a move which caused widespread controversy in the United States.

Problems associated with some well-known systems include:

DIVX: Proposed as a rental-only system, DIVX required a phone line, and thus inhibited the use of media offline. To relocate a work for which unlimited plays had been purchased (called DIVX Silver), it was necessary to carry the DVD player that first played the disk with it, or manually request that another player be authorized to play that disc. Consumers were denied certain fair use rights in countries with such a doctrine, such as the ability to create compilations of purchased material and to re-sell their copy. DIVX should not be confused with DivX.

CSS: Restricts owners’ use of purchased content, such as the creation of compilations or full quality reproductions, where such actions would ordinarily be permissible in certain countries as fair use. The system also prevents the user from playing encrypted DVDs on any computer platform, although this restriction can be easily circumvented at the risk of prosecution under laws such as the DMCA. CSS is an example of certificate-based encryption.

Product activation: Restricts a product’s functionality until it is registered with a publisher by means of a special identification code, often recording information about the specific computer the software it is installed on to prevent its use across multiple machines. Activation schemes may place some users at risk by incorrectly identifying their purchased software as unauthorized. An example of this vulnerability occurred in 2003, when Intuit’s use of a flawed product activation scheme angered thousands of customers who were denied legitimate use of the product, resulting in a formal apology by Intuit and their cancellation of the system.

Digital watermarking: Allows hidden data, such as a unique disc ID, to be placed on the media. The system allows such information as the name and address of the purchaser to be taken at the point of sale, and entered into a database along with the unique disc ID. This system does not prevent copying, but ensures that any copies made of the media will be traceable to a particular copy and perhaps to a particular user. However, the scheme relies largely on authenticating the purchaser’s identity at the point of sale, and can be easily circumvented by a customer who provides false information.

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Digital Millennium Copyright Act

The Digital Millennium Copyright Act (DMCA) is a United States copyright law passed unanimously on May 14, 1998, that criminalizes the production and dissemination of technology that allows users to circumvent copyright protection methods, rendering all forms of DRM-stripping and circumvention software illegal. On 22 May 2001, the European Union passed the EU Copyright Directive, an implementation of the 1996 WIPO Copyright Treaty that addressed many of the same issues as the DMCA.

The DMCA was largely ineffective in enforcing DRM systems, as software allowing users to circumvent copyright restrictions remains readily available over the Internet. However, the Act has been used to restrict the spread of such software by limiting its distribution and development, as in the case of DeCSS.

The arrest of Russian programmer Dmitry Sklyarov in 2001, for alleged infringement of the DMCA, was a highly publicized example of the law’s use in preventing the further development of anti-DRM measures. While working for Elcomsoft, he developed The Advanced eBook Processor, an application that allowed authorized users to strip usage restriction information from protected e-books. Sklyarov was arrested in the United States after presenting a speech at DEF CON, and subsequently spent several months in jail. The DMCA has also been cited as detrimental to legitimate users, such as students of cryptanalysis, and security professionals such as Niels Ferguson, who declined to publish information about vulnerabilities he discovered in an Intel secured computing scheme because of his concern about being arrested under the DMCA when he travels to the US.

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Other copyright implications

While DRM systems are ostensibly designed to protect an owner’s right to control copying, after a statutorily-defined period of time any copyrighted work becomes part of the public domain for anyone to use freely. DRM systems currently employed are not time limited in this way, and although it would be possible to create such a system (under compulsory escrow agreements, for example), there is currently no mechanism to remove the copy control systems embedded into works once the copyright term expires and they enter the public domain.

Furthermore, copyright law does not restrict the resale of copyrighted works (provided those copies were made by or with the permission of the copyright holder), so it is perfectly legal to resell a copyrighted work provided a copy is not retained by the seller—a doctrine known as the first-sale doctrine in the US, which applies equally in most other countries under various names. Similarly, some forms of copying are permitted under copyright law, under the doctrine of fair use (US) or fair dealing (many other countries). DRM technology restricts or prevents the purchaser of copyrighted material from exercising their legal rights in these respects.

Moreover, the scope of legal rights cannot, in principle, be fully encoded in technical access/copying restrictions. For example, a photograph generally falls under the copyright of its photographer, and may not be reproduced in an unlimited way by other persons. A photographer wishing to enforce her copyright might attach some DRM codes to a digital version of her photograph that indicate “may not be copied.” However, the photographer might subsequently sign an agreement with another party authorizing such duplication (the reason for doing so is irrelevant). Under law, the moment such an agreement is signed, copying (under the new terms) becomes legal; but the DRM software will not (has not so far, in any case) be adjustable to reflect the new legal reality established by those whose choice it is.

An oft-cited example of DRM overreach is Adobe Systems’ release in 2000 of a public domain work, Lewis Carroll’s Alice in Wonderland, with DRM controls asserting that “this book cannot be read aloud” and so disabling use of the text-to-speech feature normally available in Adobe’s eBook Reader.

DRM has been used by organizations such as the British Library in its secure electronic delivery service to permit worldwide access to substantial numbers of rare (and in many cases unique) documents which, for legal reasons, were previously only available to authorized individuals actually visiting the Library’s document centre at Boston Spa in England. This is an interesting case, one in which DRM has actually increased public access to restricted material rather than diminished it.

An early example of a DRM scheme is one that is currently being used on textbooks required in some American Dental Schools including New York University College of Dentistry. The textbooks are available only on DVD and students are forced to purchase the DVD. The DVDs are readable only on an authorized computer and only for a limited time, after which the DVD “expires” and the information in the “DVD book” becomes unavailable. Some of these books are not available on paper at all.^[5]

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DRM advocates

Some DRM advocates have taken the position that the operational contexts and design goals of DRM, security, software engineering and cryptography are sufficiently well understood that it is already possible to achieve the desired ends without causing unrelated problems for users or their computers.^{[citation needed]}

Others have taken the position that creators of digital works should have the power to control the distribution or replication of copies of their works, and to assign limited control over such copies. Without this power, they argue, there will be a chilling effect on creative efforts in the digital space. This has been and remains the underlying argument for copyright. DRM is one means by which creators of digital works may obtain this power.

A similar view states that DRM’s advent is the first time large-scale digital distribution has been reasonably achievable, which proponents claim to be a benefit both to content creators and their customers that far outweighs the typical problems that arise. This argument cannot be applied to physical media, however.

Furthermore, advocates of DRM believe that its opponents advocate the rights of hardware and media owners, but at the expense of the privileges of artists and their designated copyright holders. Consumers of hardware and media voluntarily and knowingly agree to the grant of limited use of the content exhibited using their physical media.

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DRM opponents

Many organizations, prominent individuals, and computer scientists are opposed to DRM. Two notable DRM critics are John Walker in his article, The Digital imprimatur: How big brother and big media can put the Internet genie back in the bottle^[6], and Richard Stallman in his article/story The Right to Read and in public statements “DRM is an example of a malicious feature – a feature designed to hurt the user of the software, and therefore, it’s something for which there can never be toleration“.^[7] Professor Ross Anderson of Cambridge University heads a British organization which opposes DRM and similar efforts in the UK.

The Electronic Frontier Foundation and similar civil rights organizations, including http://boycott-riaa.com and http://www.ihatedrm.com, also hold positions which are characterized as opposed to DRM.

The Foundation for a Free Information Infrastructure criticizes DRM’s impact as a trade barrier from a free market perspective.

The GNU General Public License version 3, released by the Free Software Foundation, prohibits using DRM to restrict free redistribution and modification of works covered by the license, and has a clause stating that the license’s provisions shall be interpreted as disfavoring usage of DRM. Also, in May 2006, FSF launched a “Defective by Design” campaign against DRM.

Free Creations has published a license against DRM: Against DRM 2.0.

In France, in order to inform the consumers about DRM, the citizen group StopDRM is regularly organizing protests in general stores (like Virgin or La Fnac) in different cities.

As already noted, many DRM opponents consider Digital Rights Management to be a misnomer. They argue that DRM manages rights (or access) the same way prison manages freedom. A common alternative is Digital Restrictions Management. Alternatively, ZDNet Executive Editor David Berlind suggests the term Content Restriction, Annulment and Protection or CRAP for short.^[8]

The use of DRM may also be a barrier to future historians, since technologies designed to permit data to be read only on particular machines may well make future data recovery impossible – see Digital Revolution. This argument connects the issue of DRM with that of asset management and archive technology.

DRM opponents argue that the presence of DRM infringes private property rights and restricts a range of normal user activities. A DRM component would take control over the rest of the user’s device which they rightfully own (such as an MP3 player) and restricts how it may act, regardless of the user’s wishes (for example, preventing the user from copying a song). All forms of DRM depend on the DRM enabled device (eg, computer, DVD player, TV, …) imposing restrictions that cannot be disabled or modified by the user, regardless of existing rights. In other words, the user has no choice.

Tools have been created to strip Windows Media of DRM restrictions. An example being FairUse4WM^[9]

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DRM and Internet music

Most internet music stores employ DRM to restrict the usage of music purchased and downloaded online. There are many options for consumers buying digital music over the internet, in terms of both stores and purchase options. Two examples of music stores and their functionality follow:

The iTunes Music Store, the industry leader, allows users to purchase a track online for under a dollar, to burn that song to an unlimited number of CDs, and transfer it to an unlimited number of iPods. The purchased music files are encoded as AAC, a format supported by iPods, and DRM is applied through FairPlay. Many music devices are not compatible with the AAC format, and only the iPod itself can play FairPlay-encoded files. Apple also reserves the right to alter its DRM restrictions on the music a user has downloaded at any time. For example, Apple recently decided to restrict the number of times a user can copy a playlist from ten to seven. Songs can be played on only five computers at a time, and users cannot edit or sample the songs they purchased (though copies can be used and edited in Apple’s iMovie). Despite these restrictions, the iTS DRM is often seen as lenient. Previously, it was possible to bypass the DRM through programs such as Hymn but Apple has altered its systems to close such loop holes. Apple provides iTunes software for copying the downloaded music to iPods in AAC format or to conventional music CD (CDDA format). No copy restrictions are recorded onto the CD and many programs can read and convert music from CD to other music formats, such as MP3 used by competing digital music players.

Napster music store, which offers a subscription based approach to DRM alongside permanent purchases. Users of the subscription service can download and stream an unlimited amount of music encoded to Windows Media Audio (WMA) while subscribed to the service. But as soon as the user misses a payment the service renders all music downloaded unusable. Napster also charges users who wish to use the music on their portable device an additional $5 per month. Furthermore, Napster requires users to pay an additional $.99 per each track to burn a track to CD or to listen to the track after the subscription expires. Songs bought through Napster can be played on players carrying the Microsoft PlaysForSure logo (notably excluding iPod players and Microsoft’s own Zune).

The various services are currently not interoperable, though those that use the same DRM scheme (for instance the various Windows Media DRM stores, which include Napster) all provide songs that can be played side by side through the same program. Almost all stores require client software of some sort to be downloaded, and some also need plug-ins. Several colleges and universities, such as Princeton University, have made arrangements with assorted Internet music suppliers to provide access (typically DRM protected) to music files for their students, to less than universal popularity, sometimes making payments from student activity fee funds. (See Nick Timeros’s article in the WSJ: Free Legal, And Ignored) One of the problems is that the music becomes unplayable after leaving school, unless the student continues to pay individually. Another is that few of these vendors are compatible with the most common portable music player, the Apple iPod.

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DRM and Libraries

Denver Public, Cuyahoga County and San José Public libraries join Cleveland Public Library, King County Library System, Public Library of Youngstown & Mahoning County, Wright Memorial Public Library and many others who enable the downloading of best-selling eBooks 24/7 from their library websites using the OverDrive service. The service features a growing collection of best-selling eBooks from popular authors and publishers including HarperCollins, Time Warner, McGraw-Hill, Zondervan, Scholastic, John Wiley and Sons, and more. These audio books are downloadable in the WMA DRM format.^[10]

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Controversies, consequences, and examples

A parodied Home Taping is Killing Music logo from an anti-DRM point of view.

Several DRM schemes have been implemented. Many see them as “abuse” of copyright (often called eSlavery in Europe); DRM proponents have seen them as a “reasonable balance of consumer concerns and artist rights.”

Examples include:

Digital imprimatur
Inclusion of commercials on the “unskippable track” on DVDs reserved for the copyright notice;
Using the DMCA to restrict access to items that do not qualify for copyright, such as garage door openers and printer ink cartridges;
Adding restrictions on text-to-speech conversion in the EULA of e-books;
BBC IMP trial for downloads of DRM-encrypted audio and video files; uses the Kontiki peer to peer file distribution system. Allows no user control of the background up and downloading, leading to considerable slowing of user PCs and potential exhaustion of allowed data transfers without warning due to the nature of peer to peer type operations, with only the option to shut down the user’s computer or disconnect from the Internet. BBC content is time-limited and will only play on the machine to which it was downloaded or an officially authenticated device participating in Microsoft’s DRM scheme.
Sky’s ‘Sky By Broadband’ scheme also uses Kontiki with similar results.
Using Copy Control schemes to thwart the existing statutory and common law exceptions to copyright holder control (such as fair use), as for instance in regional coding of media (such as in DVDs);
The possibility of dominant DRM-inclusive recording and playback technology being used uncritically by users unaware of the dangers and consequences thereof, and potentially later locking them out of their own creations, as with SCMS in consumer-grade DAT equipment;
Preventing academic publication and distribution of information relating to flaws in computer security in the absence of the permission of the creators of said technologies;
Silencing individuals who have found serious flaws in software used in electronic voting.^[11]
Restriction of medical records and personal financial information using DRM to protect consumer rights. Insurers, lawyers and loan companies have strongly objected to the use of these technologies to prevent patient, hospital and practitioner records being more freely accessible due to copy and forward restriction applied to patient or customer records.
As of 2005, in American dental schools students are required to purchase textbooks on DVD. The DVDs are readable only on an authorized computer and only for a limited time, after which the DVD expires and the information in the “DVD book” becomes unreadable. Some of these books are not available on paper at all.
Stopping or making archival of the content, even allowed such like in libraries, hard or impossible to do due to practical and technical reasons – especially when considering that the content should still be accessible even if the publisher disappears (bankruptcies etc).
TiVo 7.2 OS adds content access restrictions, blocks transfers, and auto-deletes some shows
The 2005 Sony CD copy protection scandal
Aesthetic objections to onscreen DRM threats interfering with relaxing and watching a movie.
The Swedish Pirate Party wants to outlaw most forms of DRM.
The legal inability to disable DRM restrictions, even if they “threaten critical infrastructure and potentially endanger lives”^[12]
Many DRM systems restrict playback to a single device and, to date, no provider has offered to renew this licence when the device is upgraded.
Some WMDRM protected files will install spyware such as Zango when the user agrees to retrieve a license to play the file.^{[citation needed]}
The Playstation 2 version of Ape Escape: Pumped & Primed creates copy-protected game saves which cannot be transferred between memory cards. This is the first known instance where a publisher has enforced DRM on private data, rather than just data copyrighted by the publisher.
The PlayStation 2 CD-ROM format games are protected and cannot be copied with normal copy software. Curiously, the DVD-ROM format games doesn’t have this type of protection.
The Xbox 360 games has advanced security code which prevents copying of the games.
The Museum of Just Not Getting It^[13] makes an attempt to tabulate the worst DRM-related decisions by media companies.

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Copyright law vs. particular techniques

Copyright law has been defined in terms of general definitions of infringement in any concrete medium. This classic approach focused such law on whether or not there is infringement, rather than focus on particular engineering techniques. Legislators have in several instances chosen not to prohibit new technologies (for example, piano rolls, radio broadcasting, and audio tape recording have not been prohibited, and in fact endorsed by inclusion in copyright legislation or the Courts in the U.S.). Critics of DRM assert that detecting and prosecuting infringement within the social and legal system avoids a legacy of outlawing generic, universal, popular, widespread, useful, and possibly uncontrollable in any case, engineering techniques in response to specific misuses.

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European dialogues on DRM concerns

In Europe, there are several dialog activities that are uncharacterized by its consensus-building intention:

Workshop on Digital Rights Management of the World Wide Web Consortium (W3C), January 2001. [1]
Participative preparation of the European Committee for Standardization/Information Society Standardisation System (CEN/ISSS) DRM Report, 2003 (finished). [2]
DRM Workshops of DG Information Society, European Commission (finished), and the work of the DRM working groups (finished), as well as the work of the High Level Group on DRM (ongoing). [3]
Consultation process of the European Commission, DG Internal Market, on the Communication COM(2004)261 by the European Commission on “Management of Copyright and Related Rights” (closed). [4]
The INDICARE project is an ongoing dialogue on consumer acceptability of DRM solutions in Europe. It is an open and neutral platform for exchange of facts and opinions, mainly based on articles by authors from science and practice.
The AXMEDIS project is a European Commission Integrated Project of the FP6. The main goal of AXMEDIS is atomating the content production, protection and distribution, reducing the related costs and supporting DRM at both B2B and B2C areas harmonising them.

The European Community is expected to produce a recommendation on DRM in 2006, phasing out the use of levies (compensation to rights holders charged on media sales for lost revenue due to unauthorized copying) given the advances in DRM/TPM technology.

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Inclusion within GNU General Public License version 3

Wikinews has news related to:

Free Software Foundation releases first draft of GPLv3

The first proposed draft of the GPLv3 (released on 2006-01-16) contains language intended to neutralize the harmful effects of DRM (interference with users’ rights to examine, alter, and redistribute) when implemented using GPL’d software. Although the draft in no way prohibits the use of GPL’d code in DRM systems, it does require binaries (or source code) to be distributed not only with source code, but also with the necessary cryptographic keys and other required mechanisms needed to modify the software and still have it interoperate. It also contains language intended to exclude GPL’d DRM code from the scope of the DMCA (and similar statutes elsewhere) anti-circumvention provisions.

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References

Wikiquote has a collection of quotations related to:

Digital Rights Management

^ Christopher Levy (February 3, 2003). Making Money with Streaming Media. streamingmedia.com. Retrieved on 2006-08-28.
^ Digital Restrictions Management and Treacherous Computing. Retrieved on 2006-08-04.
^ FairPlay: Another Anticompetitive Use of DRM. Retrieved on 2006-08-01.
^ Bangeman, Eric (2006-10-28). TiVo tightens the DRM vise. Retrieved on 2006-08-11.
^ Fleisher, Lisa (April 2002). DVD texts make lukewarm debut at NYU. Washington Square News.
^ Walker, John (September 13, 2003). The Digital Imprimatur: How big brother and big media can put the Internet genie back in the bottle..
^ O’Riordan, Ciaran (January 16 2006). Transcript of Opening session of first international GPLv3 conference.
^ A lot of CRAP. Retrieved on 2006-09-07.
^ Engadget FairUse4WM strips Windows Media DRM!. Retrieved on 2006-08-25.
^ OverDrive (December 16, 2003). Top Libraries Select OverDrive eBook System.
^ Online Policy Group v. Diebold, Inc.. Electronic Frontier Foundation.
^ Felten, Ed (March 8, 2006). RIAA Says Future DRM Might “Threaten Critical Infrastructure and Potentially Endanger Lives”.
^ The Museum of Just Not Getting It.

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External links

DRM Search Engine 1.03 – Indexed repository of DRM technical documents, download available for public documents only.
Windows Media DRM FAQ
A Special Guide to DRM and Software Activation Tools: Protect Data, Enforce Licenses
Digital rights management: When a standard isn’t
The Digital Imprimatur – How big brother and big media can put the Internet genie back in the bottle.
The Right to Read at GNU.org
DRM.info collaboration against DRM
DRM Watch – Web site with news and commentary about DRM.
World Intellectual Property Organisation (WIPO), Standing Committee on Copyright and Related Rights: Current Developments in the Field of Digital Rights Management. SCCR/10/2. August 2003.
CEN/ISSS (European Committee for Standardization / Information Society Standardization System): Digital Rights Management. Final Report, 30 September 2003. Contains a range of possible definitions for DRM from various stakeholders.
Authena – an open source DRM scheme.
Advanced Peer-Based Technology Business Models. Ghosemajumder, Shuman. MIT Sloan School of Management, 2002. DRM-free model for distributing digital music.
Music Downloads: Pirates- or Customers?. Silverthorne, Sean. Harvard Business School Working Knowledge, 2004.
Microsoft Research DRM talk by Cory Doctorow June 17, 2004
Groklaw page on Sony DRM issues and litigation.
SonyBMG Litigation and Rootkit Info.
Libraries fear digital lockdown – BBC Article.
“Lessons from the Sony CD DRM Episode” (PDF format), by J. Alex Halderman and Edward Felten, February 14, 2006.
Some criticisms of DRM
Paradigmatic example of legislators hearing a very general computer buzzword (“caching” ) associated with infringement cases and banning it, not realizing it was a universal computer memory technique. Article itself demonstrates difficulty of explaining this to general public, writer does not seem to realize every computer and most digital devices of any kind would have to be destroyed.[5]

October 11, 2006 Posted by valleyventure | Business Model, DRM, p2p | | 4 Comments

OMA DRM from Wikipedia

OMA DRM

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OMA DRM is a Digital Rights Management (DRM) system invented by the Open Mobile Alliance whose members represent the entire value chain, including mobile phone manufacturers (e.g. Nokia, Motorola, Samsung, Sony-Ericsson, BenQ-Siemens), mobile system manufacturers (e.g. Ericsson, Siemens, Openwave), operators (e.g. Vodafone, O2, Cingular, Deutsche Telekom, Orange) and IT companies (e.g. Microsoft, IBM, SUN). In order to ensure interoperability across all implementations the OMA provides in addition to the specifications also test tools for OMA DRM. The OMA DL DRM group is chaired by Jan van der Meer (Philips) and Willms Buhse (CoreMedia).

The scheme is implemented on many recent phones and is intended to be used by mobile content providers to add Digital Rights Management to their products. To this date two versions of OMA DRM have been released: OMA DRM 1.0 and OMA DRM 2.0.

OMA DRM 1.0 – Started in November 2002 and approved in June 2004: Basic DRM standard without strong protection. Specifies three main methods: Forward Lock, Combined Delivery (combined rights object / media object), and Separate Delivery (separated rights object + encrypted media object). Forward lock prevents the user from forwarding content such as ringtones and wallpapers on their phone. The content can be distributed using e.g. HTTP or MMS.
OMA DRM 2.0 – Started in July 2004 and approved in March 2006: Extension of the DRM 1.0 separate delivery mechanism. Each participating device in OMA DRM 2.0 has an individual DRM PKI certificate with a public key, and the corresponding private key. Each Rights Object (RO) is individually protected for one receiving device by encrypting it with the device public key. The RO in turn contains the key that is used to decrypt the media object. Delivery of Rights Objects requires a registration with the Rights Issuer (RI, the entitiy distributing Rights Objects). During this registration, the device certificate is usually validated against a device blacklist by means of an Online Certificate Status Protocol (OCSP) verification. Thus, devices known to be hacked can be excluded once they try to register with an RI and receive new ROs for content access.

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Implementations and Usage

OMA DRM 1.0 has been implemented in over 400 phone models. Many mobile operators (e.g. Vodafone, SFR, Turkcell, Vivo) use OMA DRM for their content services. The first OMA DRM 2.0 implementations in mobile phones were released early 2006 (e.g. the Nokia N91 and Sony Ericsson W850i). Software implementations for PC and PDA clients are also available. Most of the ringtones pre-installed on Nokia phones have implemented DRM.

OMA DRM providers include:

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Symptoms

A ringtone that includes OMA DRM usually has a “.asp” file extension. This file could potentially be viewed before downloading the actual file as kind of a confirmation request on downloading data. However, with most of today’s implementations at this point it is usually too late for denial and the user would already have been billed for the ringtone. The file extension does not matter for Nokia phones, so it is possible that they may use an extension other than .asp.

On Nokia Series 40 phones an installed file with DRM will not have its “Send” option greyed out in its options menu. If the user attempts to send this via MMS a message “The file is copyright protected” will appear. A Bluetooth file transfer will fail if the user tries to extract the file using Bluetooth, yet the file will still appear as present and will still be deletable via Bluetooth.

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External links

October 7, 2006 Posted by valleyventure | DRM, Music Industry, our venture, p2p | | 1 Comment

Music Industry Brief

Industry brief: Music recording I

Part 2 3 More

In the music business is one is a set of recording companies that produce over 20,000 new recordings each year, The object of the recording companies is to get these titles on the shelves of retailers and then to get them off the shelves into the hands of the public.

These shelves are very full. And not only are recordings in every type of music contending for shelf space, but they are also contending with over 100,000 backlisted titles. So that the Black Crowes are not only competing with Eminem for space in the Tower Records shelves; they are also fighting with five decades of predecessors from Chuck Berry and the Beatles through to Metallica and Aerosmith.

It costs several million dollars to record and launch any major new pop album these days. And audience tastes are unpredictable, so many of these launches are for naught. Music companies are saved by the occasional big hit among the many flops. But winning shelf space and mind space while prolonging shelf life is harder than it’s ever been. And now comes a new threat – digital distribution of music over the Internet, as fans have been sharing recordings and avoid buying recordings off the shelves.

Music then is in transition. It’s going from a tangible that you buy off the shelves to an intangible, something that’s on the Net and available to anyone who can in turn record them on tape or CD. This “de-materialization” of music has the big five companies worried, and with good reason. Will music stop being a product and return to being a service?

The Big Five

In the last ten years, the rate of concentration in the $40 billion music industry has been breathtaking. Five companies have taken over vertical and horizontal control over almost every aspect of the industry. These five own virtually every record label you can name — a curious leftover term from when music came on vinyl records with actual paper labels in the center). Many of these labels with histories back to the Victrola days (like RCA Victor and Parlophone) are now under the control of a handful of international entertainment conglomerates that have learned to prolong shelf life and dominate shelf space ruthlessly. Although changes in the way music is delivered are a threat to the giants, they have the financial, legal, and technological muscle to minimize their losses and maximize their gains.

There a are five major record label conglomerates, who control over 80% of all the titles produced in the United States and comparable percentages in the rest of the world. They are Warner Music, EMI Group, Universal Music Group (UMG), Bertelsmann Music Group (BMG) and Sony. These also own distribution companies that control over 80% of the wholesale market. They are also becoming a bigger presence in the retail sale of recordings. Furthermore, they have rights to much of the copyrighted music, often not the artists who originally wrote the music. The oligopolies are growing and concentrating. And it seems every time an independent begins to build new markets, it soon gets bought out by one of the big guys

The pace of consolidation is increasing. A few years ago there were a big six in the industry UMG (Universal Music Group) is a merger of Polygram and MCA brought about in 2000 by Seagram/Universal which in turns has been taken over by French media/water conglomerate Vivendi (now dissolving). Time Warner and EMI announced merger plans in 2000, but that was held up by European antitrust laws. It’s not hard to imagine that one or more of the remaining companies will get swallowed up by another. There are steady rumors, for example, that BMG is looked to be sold or merged.

Of course, Universal Music Group is on the block, the biggest of them all. While it is unlikely for antitrust reasons and cash flow problems that any of the others will take over UMG, neither do they want an energized new competitor. After all, UMG is the largest of them all, and has been growing steadily in sales volume, even in the downturn.

But UMG has few suitors, and the reason is the general decline of the business. From 1988 to 1996 the industry grew at a rate of 8% a year. Since 1996 it has shrunk by a total of 17%. The two reasons are music piracy and just plain unexciting music from the recording companies, though they will never admit the latter.

The Internet has and will continue to be a great disruptor in the industry, All the threats by Senator Hatch and the recording industry trade group, all the lawsuits against individual college students, will not work. The industry shut down Napster, but file sharing has found other routes. The only sane moves by the industry have been to finally enable reasonable file download services, such as Apple’s, but they may be too little too late. The industry looks like it is in the midst of being redefined, and the big five are at their most vulnerable thanks to the disruption.

Here are descriptions of the Big Five (as currently constituted) with some notes.

Company	AOL-Time-Warner
Recording Group	Warner Music Group (WMG)
Market Share (2001)	12%
Labels (select)	Atlantic, Atco, Elektra, Asylum, Reprise, Maverick, Rhino, Sire, Warner Brothers
Publishing division	Warner/Chappell Music
Distribution division
Manufacturing division	WEA
Retail	Columbia House (part, 50%)
Artists under contract (select)	Faith Hill, Linkin Park, Madonna, Red Hot Chili Peppers, Seal
Other media holdings (select)	Warner Brothers (film), WB Network, Time Warner Cable(television), Time-Life (magazines) Warner Books (books)

AOL-Time-Warner says that this piece of their empire is not on the table, though so many others are. Warner/Chappell, with over a million titles, is a major money-maker.

Company	EMI
Recording Group	EMI
Market Share (2001)	13%
Labels (select)	Capitol, EMI, Blue Note, Parlophone, Angel, Chrysalis, Virgin
Publishing division	Capitol EMI Music Publishing
Distribution division	EMD
Manufacturing division
Retail	HMV Group, Columbia House (record club, 50%)
Artists under contract (select)	Sarah Brightman, Garth Brooks, Janet Jackson, Liz Phair, Rolling Stones
Other media holdings (select)	WEMI Television (television)

EMI is the only major music company that is not part of a conglomerate. For that reason, its declining sales and profits must hurt all the more. The bright point is the music publishing division, which is the largest in the world, with over a million song titles.

Company	Sony
Recording Group	Sony Music
Market Share (2001)	15%
Labels (select)	Columbia, Epic, Sony, Arc of Light, Vivarte, Soho Square, Mambo, Dragnet, Harmony Records, Legacy Records, Loud Records
Publishing division	Sony/ATV Music Publishing
Distribution division	Sony Distribution
Manufacturing division	Sony Disk
Retail	Columbia House (part)
Artists under contract (select)	Aerosmith, Tori Amos, Placido Domingo, Ricky Martin, Pearl Jam
Other media holdings (select)	Columbia, Sony Studios (film)

Sony is the number two music company, but its growth has stagnated. Sony’s ownership is a product of its its foray into the media world, a decision from which Sony never derived the hoped-for synergy.

Company	Vivendi Universal
Recording Group	Universal Music Group (UMG)
Market Share (2001)	24%
Labels (select)	MCA, Geffen, DGC, Mercury, Polydor, London, Vertigo, Verve, Wing, A&M, Island, Motown, Decca, Interscope, Deutsche Gramophone, Phillips, DefJam
Publishing division
Distribution division	Polygram Distribution
Manufacturing division
Retail
Artists under contract (select)	Andrea Bocelli, Warren G., Nelly, Willie Nelson, Shania Twain
Other media holdings (select)	Universal Studios (film) Canal Plus, USA Networks (television)

UMG is the world’ largest music company, and its growth over the past year has far outstripped its rivals’. Yet it’s parent company is in trouble, and it may yet be sold, if anyone wnats it enough.

Company	Bertelsmann
Recording Group	Bertelsmann Music Group (BMG)
Market Share (2001)	10%
Labels (select)	RCA, Arista, Wyndham Hill, New Talents, Arte Nova, Zomba, Bluebird, Jive, Bad Boy
Publishing division	BMG Music Publishing
Distribution division
Manufacturing division	Sonopress
Retail	BMG Music Services (record club)
Artists under contract (select)	Denyce Graves, Jennifer Love Hewitt, Avril Lavigne, R. Kelly, Britney Spears
Other media holdings (select)	RTL (radio), magazines, newspapers, Random House and many others (books)

BMG saw a significant decline in sales in 2001. Bertelsmann certainly wants to get rid of it, but with UMG on the block, it will be hard.

As noted before, not only have the big five recording companies grown horizontally by spreading worldwide and grabbing labels in all kinds of markets, they have also expanded up and down the supply chain, from manufacturing to retailing to Internet and other retail sales. For example, Sony has been one of the largest manufacturers of compact disks for years, and BMG now has the biggest music club membership in Europe, while Sony and AOL-Time-Warner own parts of Columbia House, a major U.S. record club. And they all have their own music publishing businesses, where they control the rights to the vast majority of popular music from “Happy Birthday” to “Material Girl,” and get money every time someone records an old song, plays it on the radio, or uses it in a sound track. In this way the control our whole ambient music experience.

As in all other businesses, the growth of the oligopoly in music is an attempt to exert control of our three factors. These companies don’t get bigger because of some manifest destiny. They get big because only the biggest firms can control their own fates, even within the notoriously volatile music market.

Most of all they want to control shelf space. While they might fight against each other, together they determine nearly all of what gets on the shelves at music stores, at the record clubs, the online sources, and what gets played on the radio. Smaller firms can hardy get on the rack, and then can hardly get a timely resupply. Examples:

Thanks to consolidation in the retail chains, they can have a big impact at a high level at such national companies as Borders, Tower, Sam Goody’s, and few others, by offering specials and constantly managing relationships at the highest levels. (Indeed, they recently made a major court settlement based on price-fixing with the major stores.) They can influence how their recordings are displayed, they can help determine what goes on sale and when, and they can grab their share of the precious shelf space that stores command. In other words, they act the same way as Kraft, Pepsi, or Budweiser operates in the supermarket, only with even more concentrated power.

They form an oligopsony for all musical artists in the world. They alone can guarantee international distribution for albums, especially in places like South America and Asia. They, and no one else, have the power to make sure that a hit becomes available across the world. Likewise, they alone can bring music from other countries (World Music) and give it exposure in the U.S. and Western Europe.

They can own and manage the record clubs that are very popular way especially for college students to buy music.

They can own their own distribution companies, so that small labels that want national exposure need the majors to get just-in-time delivery to the store shelves. Even the occasional independent hits at some point pass through the major recording companies’ fingers.

When they see a small label have a breakaway success, they can overwhelm them with cash and buy them out and the artist’s contract. One area where this has happened in hip-hop, where corporate types have been happy to let those closer to street tastes to identify and consolidate the tastes of the audience, and bring up the artists until they are at a point where the majors could handle them.

They can work with local concert promoters to set up tours with favorable conditions for the artists who they want to push. They can rearrange the beer and soft drink sponsorships that finance the tours. This fits in well with the fact that the best venues for performance in the industry are controlled by an even small number of concert promoters and bookers.

They can have a big influence as radio play lists are decided on, especially since the radio industry is consolidating and centralizing decisions in fewer and fewer chains. This is not to say that they can force a hit or keep a loser on the air (the cruder kinds of payola are history), but they can get air time for what be overlooked otherwise or help build momentum as a hit takes off by making sure that the radio programmers know what’s up. After all, the first step to getting to be a hit is getting heard. While cash payola may take place, there’s no longer a need for the penny-ante variety. Big recording companies can wine, dine, and influence programmers at major chains. They also exert pressure as major advertisers for all their products, musical or not, on the same radio chains. Plus, increasingly, the decision-making more centralized. The great American story of singers like Loretta Lynn driving around the country to personally request disk jockeys to play their songs is long dead.

Finally, they hope they can take on the whole Internet challenge or any other threat through major legal help and through the ability to put increasing pressure on governments, especially copyright violators. They may eventually take control of the online distribution industry, at least as much as they can control it. Meanwhile, their lobbying association The RIAA (Recording Industry Association of America) allows them to work in concert in spite of antitrust laws. They have already had major impact on copyright laws, and are trying to have Congress pass ever more restrictive laws governing use of copyrighted materials.

Getting on the shelves of the record stores is not enough. Most music sits around unsold. Even if it has some success, that success can be very short-lived. As a result, the Big Five recording companies seek to guard themselves against the notorious changes in fashion that determine the shelf life of individual titles. Again, they can’t really decide in advance what will be a hit, and though they back artists with advertising campaigns and concert tours, public taste is fickle.

Take for example the Spice Girls, a meteoric success which crashed and burned, now long as dead as disco. For a few years in the mid-90s swing was in, now it’s out. We’ve seen a series of rappers come and go with one big hit, then nothing. Even Britney Spears and Christina Aguilera are losing altitude. More than ever, stars are moved quickly into and out of the spotlight. Hence the popularity of the VH1 TV shows “Where are They Now?” and “One Hit Wonders.”

On the other hand, some things are perennial. The Beatles were a few years ago at the top of the charts with a re-release of some of their music. Paul Simon released a hit album after he seemed to be washed up. Billy Joel had a modest hit playing his own “classical-style” music, and they keep selling the Eagles albums. These are great assets for the recording companies, as they don’t have to start the hype campaign from scratch. In the case of the backlist, they realize almost pure profit.

But there are many ways to prolong the shelf life of any even moderately successful piece or genre of music. The recording companies do this in several ways:

First, they can sign a large number of new “artists” in different genres so that a dip in one artist or category is compensated for by wide coverage. Thus they have the bases covered when a new trend breaks out.

If they do have a hit, they can prolong its life by intense marketing, promoting radio play, organizing concerts, running displays in stores, arranging television appearances (in some cases, most notably Time-Warner, on their own stations) and so on. All these take the kind of money that’s only available from a big, strategic company.

They can maintain back lists of the titles that steadily maintain sales – thus Sony which owns the Beatles backlist has the money pouring in still, from newly released recordings, from old standbys, and other uses. The release of a set of thirty-year old Beatles hits (the album “1″) became on of the top-selling albums ever, outdistancing the hottest releases from new groups. All of majors have stable of similar, if slightly less productive, cash cows. After all, all the upfront costs have been paid along ago. Companies are also digging out unreleased tapes by older artists like Dylan, even reconstructing recordings sessions or concert tapes that never made it to vinyl.

They can switch media – in fact, the replacement of LP collections by CD collections in early 1990s were a major financial boost for the companies in every area from rock to jazz to classical. Now it looks like CDs may give way to DVDs, and mini-disks are a possibility. That’s not to mention personal digital recorders (A threat and an opportunity).

They can own their own manufacturing companies so that they can reduce costs and improve inventory management, making sure they have just enough copies of each title.

In fact, whatever dangers digital music has, for the major music companies, it will certainly make their backlists even more valuable, if they can protect their copyrights. Apple’s new song download software has been a bonanza for companies. Selling songs for 99 cents is an uncanny way of recycling the old stuff at no cost in distribution or marketing. It’s also like selling cigarettes one at a time for a total price three or four times the cost of the pack.

The new digital music economy, whatever its perils, offers the Big Five a chance to prolong the life of their vast library of recorded music, The question is how to do it without having to send thousands to jail, the course the Big Five and the RIAA now seems intent on.

September 11, 2006 Posted by valleyventure | DRM, Music I, Music Industry, our venture, p2p | | No Comments Yet

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Valley Venture

Ramdomness of wireless and mobile business by Robert Zhu

Integrating DRM with P2P

DRM from Wikipedia

Digital Rights Management

Contents

Introduction

Content Scrambling System

Legal enforcement of DRM

Digital Millennium Copyright Act

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DRM advocates

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DRM and Internet music

DRM and Libraries

Controversies, consequences, and examples

Copyright law vs. particular techniques

European dialogues on DRM concerns

Inclusion within GNU General Public License version 3

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