Experts discuss value of digital rights management systems for companies involved in content distribution.NEW YORK—While DRM vendors aim to protect the rights of content creators, some of them seem to spend more time and money protecting their own rights.
Microsoft's settlement with Intertrust over DRM patents this year clears up only one of several digital rights management patent disputes that are currently hindering the growth of the market.
Uncertainty about licensing requirements remains a wild card among potential DRM licensees. At Wednesday's DRM Strategies Conference, a panel of experts examined the scope of the problem.
One issue, according to Dr. Willms Buhse, Director of Products & Marketing at CoreMedia, a systems integrator from Hamburg, Germany, is the fact that the people who create DRM technology naturally become sensitive to the value of intellectual property.
That sensitivity can generate an exceptional vigilance about documenting and enforcing their own rights. The result is something of a licensing stalemate between owners and vendors of various rights management technologies.
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One case in point is the standoff between the Open Mobile Alliance, an association of mobile technology vendors, and MPEG LA, a private licensing organization that represents many technology patent owners as well as the well-known MPEG license owner (MPEG LA is a distinct organization from the MPEG standards body). Recent negotiations between the two groups have bogged down over issues of pricing.
Bill Rosenblatt, panel moderator and president of GiantSteps Media Technology observed that virtually nobody has made a business entirely from selling DRM technology.
"Nobody wants to pay for this stuff," Rosenblatt said, adding that most successful DRM technology is sold in the context of content management systems rather than in pure DRM solutions.
Buhse rebutted that idea, however, pointing out that telecom companies are looking to content distribution as a new business model to replace sagging revenue from their traditional telephone businesses, and that DRM is central to any content distribution business. "Content delivery is a growth opportunity for telcos," he said "they are very willing to pay."
Martha Nalebuff, director of policy and strategy at Microsoft Corp., offered the opinion that DRM licensees need indemnification in order to be protected from patent claims.
Nalebuff described Microsoft's concerted efforts to provide indemnification to its DRM licensees in order to minimize legal risks. "If you use our technology," she said "you don't have to be afraid of somebody coming after you." She also made the case that "DRM is an enabler… We all benefit when content flows through legitimate channels."
A lawyer's point of view was offered by Jason White, a partner at Brinks Hofer Gilson & Lione, a busy intellectual property law practice, noting that patent applications have increased by 100 percent in the last 10 years.
White observed that patent filings can be "both offensive and defensive," in that your patent filing can protect you in the case that someone claims that you've infringed their patent, in which you can point out that you have patents as well.
Buhse closed the panel by expressing optimism that the cold war over DRM patents will soon reach some kind of détente and help bring the DRM business to maturity.
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