Micro$oft is planning on building it’s Digital Rights Management technology directly into the Windows Operating System.

Without much fanfare, Microsoft has captured a leading spot in the
content-protection business, a role that is fostering closer relationships
between the software giant and music labels and movie studios.
The last several months have seen most of the major music labels release songs
in Microsoft’s Windows Media format, which has built-in copy protection, or DRM
(digital rights management) technology. Most of the labels are quick to say they
are technology agnostics, but in a few cases their commercial download services
are using exclusively Microsoft technology.

Without much fanfare, Microsoft has captured a leading spot in the
content-protection business, a role that is fostering closer relationships
between the software giant and music labels and movie studios.

The last several months have seen most of the major music labels release songs
in Microsoft’s Windows Media format, which has built-in copy protection, or DRM
(digital rights management) technology. Most of the labels are quick to say they
are technology agnostics, but in a few cases their commercial download services
are using exclusively Microsoft technology.

“What Microsoft has done is as close to my mission statement as anything I’ve
seen,” said Jay Samit, a senior vice president at EMI Group. “They’re making it
as easy to buy music as it is to steal it.”

That quest for secure downloads is still a long way from completion, however.
The labels’ services, which cost up to $3.99 per song, are far from competing
with the still snowballing popularity of file-swapping service Napster. And
that’s the fundamental flaw in any DRM technology, many analysts say: Millions
of copies of songs are already on the Net without any protection.

The idea of protecting songs, movies or other content from being copied and
distributed has been a controversial one among technologists and consumers. But
it’s becoming clear that Microsoft is betting on the technology to extend its
reach deep into the digital entertainment world, with hopes of becoming the
standard infrastructure for delivering music, video, games and other digital
files.

Several other content-protection plans from companies such as InterTrust and IBM
have gained ground in the young industry. Microsoft, however, is betting on the
advantage that has served it so well many times before: Its product is in the
operating system.

“Clearly, the fact that they write the Windows operating system gives them an
ability and credibility when it comes to securing music within the bowels of the
computer,” said Aram Sinnreich, an analyst with Jupiter Research. “Microsoft has
been slowly building up strength as a dark horse in this business.”

Locking the door
DRM companies have taken something of a beating in
popular opinion over the last year. The emergence of Napster and other file-
swapping services has conditioned a large number of people online to the idea of
free music. Putting a technological lock on the songs is seen as an insult by
many Net music lovers.

Nor has DRM technology have a solid track record. Several online instances of
content protection–notably Stephen King’s first attempt at Net publishing–have
been quickly cracked. Most backers of DRM systems concede that anything can be
hacked given enough time and energy but say content protection is geared toward
keeping mainstream surfers from stealing.

The features of Microsoft’s offering aren’t unique. Like others in the business,
they give the content owner–the record label, movie studio or publisher–the
ability to distribute works with rules for use. For example, a song might be
able to be played by anyone, played a single time, or played only if the
listener goes to a Web site and plugs in an e-mail address.

What’s novel is that it’s built directly into an audio and video technology that
is quickly gaining ground on its own, and that the two technologies are
inextricably linked. The technologies, in turn, are being set deeply into the
Windows operating system. Other technologies being built into Windows further
boost content-protection features, such as the so-called Secure Audio Path,
which scrambles output from a computer sound card so that music streams can’t be
tapped and copied at that point.

“We see Windows Media and digital rights management as a core service in the
operating system,” said Michael Aldridge, lead product manager for Microsoft’s
Digital Media Division. “This is going to be a core technology for anything
that’s distributed across the Web.”

Under the legal eagles’ eye
That argument has been heard before. In
the browser wars, Microsoft contended that its Internet Explorer was an
operating system component, and that it was using no unfair advantage in its
fight against Netscape Communications. The Justice Department disagreed, as did
the judge that ordered that Microsoft be split into separate operating system
and application development divisions.

Antitrust lawyers say Microsoft must have a dominant market share in the audio
and video market with its Windows Media technology before triggering any legal
scrutiny. But it’s not outside the realm of possibility, some say.

“What you have seen is that one of the things the government worried about is
that Microsoft would continue to add more and more features to its operating
system for which there was independent consumer demand,” said Emmett Stanton, a
partner at law firm Fenwick & West. “This could bear some scrutiny.”

Microsoft counters that adding the content protection deeply into computers’
and other devices’ infrastructures is the only way to be confident of security.

“We’ve had a core multimedia system like this as part of the operating system
since 1991,” Aldridge said. “There are very low-level things that have to happen
for this to work.”

A few executives at major music labels have privately expressed some concern
that Microsoft has tied its content protection technology so closely to its
music and audio technology. Most labels are still experimenting with multiple
formats and protection plans from several companies. Some even have created
their own content-protection systems.

Microsoft and the record companies hope that by offering a legal version of
Napster or other subscription services that have new songs, concert tickets or
other tie-ins, they can persuade people to pay for what many file swappers are
getting now for free. It will be a hard sell, many analysts say.

“Napster is not an evil thing for content owners,” Microsoft’s Aldridge said
optimistically. “It’s just that it doesn’t have any DRM in it.”

Author: John Borland

News Service: ZDNet

URL: http://www.zdnet.com/intweek/stories/news/0,4164,2681422,00.html