The many faces and challenges of Microsoft's DRM strategy

The many faces and challenges of Microsoft's DRM strategy

Summary: ComputerWorld's Matt McKenzie has published a story that's probably the most comprehensive look (and report card) covering Microsoft's various digital rights management (DRM) initiatives. I don't know that I've ever seen Matt's work before.

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TOPICS: Microsoft
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ComputerWorld's Matt McKenzie has published a story that's probably the most comprehensive look (and report card) covering Microsoft's various digital rights management (DRM) initiatives. I don't know that I've ever seen Matt's work before. But, with this one report, he has just earned some serious cred (at least with me) as being one of the great communicators of what the future will be like as long as DRM is allowed to infiltrate every part of our lives.  But, in the same breath, you can't help but walk away from his report thinking that Microsoft is on the doorstep of what could be a massive failure in strategy -- particularly when it comes to the way that its moves with Zune are going to fragment an already fragmented marketplace. 

McKenzie's discussion of Output Protection Management gives us a special glimpse of the lengths to which the entertainment cartel and its technology partners are going in order to rid the path -- from content source to final output device (eg: a display) -- of any opportunities to siphon content into the unprotected world. Wrote McKenzie:

Perhaps the most prominent (or notorious) OPM technology [is[ known as Protected Video Path (PVP)...[Copy protection on DVDs themselves] cannot stop attempts to intercept and copy the protected content further downstream, as it moves first to the graphics card and finally to a user's display -- a problem sometimes referred to as the "analog gap."....

PVP eliminates these security gaps, enabling a series of DRM measures that keep a high-resolution content stream encrypted, and in theory completely protected, from its source media all the way to the display used to watch it. If the system detects a high-resolution output path on a user's PC (i.e., a system capable of moving high-res content all the way to a user's display), it will check to make sure that every component that touches a protected content stream adheres to the specification. If it finds a noncompliant device, it can downgrade the content stream to deliver a lower-quality picture -- or it can even refuse to play the content at all....

....sooner or later, most Vista users will probably encounter PVP-protected content -- and more often than not, they will walk away from the encounter at least a little frustrated, disappointed or even angry.

This, of course, makes no mention of the fact that some of your most expensive gear could be rendered obsolete by such protection technology. And, if you think this technology is going to be restricted to video content, think again. Several sources  I've spoken to say that the record industry is extremely keen to have a similar degree of protection from content source all the way to your speakers. Given the investment I just made in filling my house with audio, the idea that all my gear, including the monster cable I've run through the insides of my walls, could end up being for naught is infuriating. McKenzie's report goes on to quote Directions on Microsoft analyst Matt Rosoff as saying (of the HD-DVD and Blu-ray formats) that Windows Vista's DRM is "so consumer-unfriendly" that he thinks it will fail "and when it fails, it will sink whatever new formats content owners are trying to impose."

Ouch.

McKenzie gets Microsoft Consumer Media Technology director Jonathan Usher on record with some quotes that are confounding, even to a casual watcher of the industry. Usher told McKenzie ""We expect that the improvements in Windows Vista will attract new content to the PC, which is exactly what consumers want."  

More content on the PC? What isn't there now? Counting sites like YouTube, JibJab, and a whole bunch of other Internet sources and the DVD players found in most computers, I actually have access to more content on my PC than anywhere else. What new content could he possibly be referring to? What consumers is Microsoft talking to? They can't possibly inhabit the same planet I do. I've never heard any consumer say anything that even remotely validates this statement. In an indication that he believes consumers are actually in control (instead of the entertainment and technology cartels), Usher told McKenzie "Consumers are the final arbiters because they can vote with their wallets."  What a friggin' crock. Is this sort of like the way we're the final arbiters of the Digital Millennium Copyright Act (another endeavour of the entertainment cartel)? 

What are we voting for now? One DRM vs. another? A different degree of protection? Vote for no DRM altogether? Seems like no matter what consumers will get to vote for, as long as they actually vote, it's a no win situation for Microsoft (or any other DRM provider). The feeling I get is that, between the DRM parasites attaching themselves to all the content we consume (eventually text too) and the DMCA, the general idea is to give consumers no vote whatsoever.

McKenzie does a great job condensing the connection between DRM and anti-piracy schemes like Microsoft's Windows Genuine Advantage program into one paragraph (it would have taken me ten) and finally lands on Zune (launched yesterday). McKenzie quotes Bill Rosenblatt, managing editor of Jupiter Media's DRM Watch as saying:

Music bought for Zune may not be playable on other PlaysForSure devices; Zune will decrease interop, not increase it......Customers who bought tracks from Napster et al. can play them on Zune, but not vice versa......Why do this?.....The device ecosystem strategy is too fragmented, too complex to use and too hard to market to consumers; it simply is not an effective strategy to compete against Apple.

Meanwhile, here in ZDNet-land, there's plenty of content flowing that points to problems for the Zune brand. Mary Jo Foley points out how Zune is currently incompatible with Vista (a situation that Microsoft says it will be resolving) while News.com reports that Zune sales are off to a slow start, and in fact, aren't even on display yet at some stores that are supposed have them. Where customers have found Zunes (eg: Best Buy), the reactions have been mixed. The wider screen (wider than what iPods have, a gap that Apple can easily close) seems to be getting the most positive attention. People have cited that feature as making the device more suitable to video playback but are also pointing out that 30GB is hardly enough drive space if video is what they're going to load onto the device.  Good point!

Topic: Microsoft

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24 comments
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  • DRM is a don't care to me

    I live DRM free. I use Linux, ogg only (no slam on mp3, I just find ogg better quality, and seamless in Linux). I could care less about WMV, MaybePlays, HD/Blue Ray, Zune, Ipod, you name it, I, on principle simply refuse to buy any of it. I have a ton of CDs and that is how I choose to get all my music. It is amazingly simple. Anything that requires DRM control over me/my use, I simply live without, and what am I missing? Honestly, what can't you live without?

    DVDs, they don't offer a compelling price/value proposition. It is easy to live DRM free, and if everyone stopped buying DRM offerings, it would cease to exist. They act like we need them and they don't need us. I don't (and won't) purchase content I can't listen to in my truck, on my iriver, etc. Online music, besides DRM infected, is inferior quality and just not worth it.

    If you want to throw your money at DRM offerings, your choice. The good news is, DRM is destined to fail because you only get to shaft people once (maybe twice). The people who don't know about DRM is a shrinking pool. Ask anyone who has lost their IPOD database, or the poor saps who purchased content from MSN, and soon, all the MaybePlays folks out in the cold if they will buy new DRMed content.

    I hope they continue to fork out tens of millions in a futile effort to accomplish successful DRM. I know it is futile, they know it is futril, hackers know it is futile, yet management doesn't know how to change their stale losing proposition monopoly business model and since they have no fresh ideas, they keep going and going and going.

    Tell me, how much profit did Sony make off their DRM infected CDs with the rootkit? How much money has MS made from MaybePlays and all their DRM development? Isn't it still cracked? Vista with cutting edge anti-piracy is already hacked, and MS admits, they can't stop piracy, it is an annoyance tool for their legitimate customers. How many tens of millions has been wasted studying the "Analogue Hole"? I laugh out loud every time I imagine some room full of geniuses bouncing idea after idea around only to end the day with nothing.

    Keep throwing your money at mission impossible. In the meantime, eMusic just seems to get better and better.

    The bottom line, if I never purchase anything from them, I'll be just fine. If they never sell to anyone, their out of business. Who should be in control of this situation?

    TripleII
    TripleII-21189418044173169409978279405827
    • eMusic

      After a number of years I re-discovered eMusic recently. They have made a lot of progress in building their library. I am finding a wealth of good stuff, at very good quality,,,,and,,,No DRM!.
      Music fans should at least give them a look. It's all Indie music which is where most of the real creative talent is now days.
      perryroyce@...
      • I'm really happy with eMusic

        Don't mean to be a shill, but I've been really pleased with eMusic. Song downloads are less than 25 cents each, high quality mp3 files, no DRM.
        tic swayback
        • RW: I'm really happy with eMusic

          While they don't have the big name stars, you might want to take a
          look at Magnatune.com as they have some really great artists
          there. You do have to purchase music by the CD, but the price is
          set by you and not them. 50% of the price goes directly to the
          artist and all music is downloadable as full CD quality WAV files if
          you want it that way. I prefer to get my music in a lossless
          compression format.
          Protagonistic
  • DRM = Opportunity

    DRM isn't going away. There's too much money involved for the content providers to keep it unprotected. That said, DRM implementations are still in their infancy. The industry and the consumer are both waiting for an effective, mature implementation that satisfies creators, distributors, and consumers.

    What will that implementation look like? I don't know -- but the company that provides it will make a bunch of money. It's also entirely possible that there will be multiple, competing solutions (although, over the long term, I think that's unlikely as economies of scale dictate that the industry will eventually consolidate on a single standard). In any event, the future is notoriously difficult to predict and I think it's impossible for anyone to say what the DRM market will look like in 5 or 10 years.
    pkstephens
    • The real opportunity here...

      ...is not for the media companies, it's for the DRM provider. The DRM itself will always be flawed and easily broken. Any system where you have to provide the key to the person you're trying to lock out is inherently never going to be secure.

      But the hardware DRM described in this article is a huge opportunity for profit. Let's say MS builds this in to their OS. So, any company that wants their products to work and play content will now have to pay MS for a license to be part of the system. It's brilliant really, you get paid by the media companies AND by the electronics companies who make the devices. And you can shut any of your competitors out of the market by refusing them a license.
      tic swayback
    • Yes, opportunity to throw good money after bad

      [B]The industry and the consumer are both waiting for an effective, mature implementation that satisfies creators, distributors, and consumers.[/B]

      This simply isn't possible. After tens (hundreds of millions of dollars), many companies all throwing bright minds at it, and all we have is DRM from MS that can be re-hacked in 24 hours or less, Itunes DRM which is as secure as a wet paper bag, or Sony who lost 100X more than they will recoup from their fiasco.

      What they are trying to accomplish is a farce. You can't create a secure system where you selectively allow some users to access content while others are blocked. The ONLY real DRM is for them to encrypt a song and let no one see it. As soon as you provide the mechanism for one to be able to see it, it is inevitable, it will be cracked.

      In the meantime, however, the absolute inability for ANYONE to create flawless software means millions of legitamate customers are affected.

      Like I said, there is no DRM opportunity except to throw good money after bad. The legal system is the only weapon that works (with marginal success) to prevent piracy. Evertything else is either an attempt to lock consumers into specific markets or some executive who just doesn't understand technology and keeps trying to attain the impossible.

      TripleII
      TripleII-21189418044173169409978279405827
  • My Subject

    Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123 Body123
    SrikantTest
  • Shooting yourself in the foot

    We live in fascinating times. All these new technologies, and the media companies are truly exploring the boundaries. Right now, they're pushing things to absolute extremes, creating products that are so locked down as to be completely useless. The question is, how are consumers going to react? Are we just going to take it? Are we willing to pay more for a product that does less than what we already own? I strongly believe that the market will reject such products. There are so many ways one can spend one's entertainment dollar that if one product becomes less desirable, that money can easily go elsewhere. That's the fatal flaw in all these DRM plans, a failure to realize that the customer can just walk away.

    As more and more major media corporations make their products less and less desirable, we'll see more smaller independent companies rise to prominence by selling usable forms of entertainment. The artists will slowly abandon ship from the majors, and in all likelihood, will start running their own careers without any corporate overseers. So really, the DRM is just a way of hastening the downfall of the media dinosaurs.

    Great interview here with the former manager of Pink Floyd and the Clash about how the future is likely to go, and how the major music labels are f'ed:
    http://www.theregister.co.uk/2006/11/03/peter_jenner/
    tic swayback
    • Amazon Unbox Anyone?

      [B]That's the fatal flaw in all these DRM plans, a failure to realize that the customer can just walk away.[/B]

      Or run away screaming before even trying it. Or is Unbox silently taking over the world and I don't know about it. Hey, what's a few more million down the tubes writing all the DRM crap into their system and software. :-D

      The only DRM that seems to be "accepted" by consumers is Ipod's, and that is due to the fact that it is so transparent as to not really be there. Itunes themselves tells you how to backup to regular CD and create MP3s.

      TripleII
      TripleII-21189418044173169409978279405827
  • Typo

    Is this a typo:

    "Customers who bought tracks from Napster et al. can play them on Zune, but not vice versa"

    I didn't think Zune would play Plays-For-Sure crippled songs.
    tic swayback
  • Zune does not play PlaysForSure tracks

    I was quoted in this blog post and in Matt McKenzie's article in Computerworld as saying that Windows Media DRM (PlaysForSure) music tracks will play on Zunes. This turns out not to be true. I made that statement a few weeks ago (when Matt interviewed me), when it was still unclear. PlaysForSure and Zune are not mutually compatible at all.

    Bill Rosenblatt
    GiantSteps Media Technology Strategies
    Editor, DRM Watch (www.drmwatch.com)
    billr@...
    • Thanks for posting

      It is good to see a person follow up and correct a mistake. We all make mistakes, but many just try to sweep it under the rug or try to "clarify" what they meant.

      TripleII
      TripleII-21189418044173169409978279405827
  • Zune = $250 ... FifthUnit = $73.50

    And the FifthUnit player will play anything I care to throw at it.

    Not to sound like a shill, but:

    http://contents.fifthunit.com/html/products.5th/sku.490.html
    Too Old For IT
    • The same unit...

      ...can be had from a Hong Kong outfit on eBay called Discounttown. I bought a 1-gig one for $26.00 auction price. Current eBay starting price for the same thing is $35.50. It works well, with the exception of the screen surface being a fragile thin sheet of glass, as my son found out. Fortunately the LCD is not attached to the glass. They have 2-gig units as well.
      Rob Groh
  • Headphones?

    It'll sure be interesting when even the earbuds you buy for your iPod will have PVP authentication built in.

    Go ahead...plug that analog hole and I'll just plug my wallet. No money for nothin'
    becksdark
  • DRM of some kind is inescapable...

    Content creators and distributors will always, ALWAYS, demand that their content be protected from theft. Asking them not to do so is like asking an electronics store to shut down for the night and leave their doors unlocked and their alarm system turned off. Would you leave your house unlocked in a bad neighborhood? I doubt it.

    That said, I think so far, companies use of DRM has in large part been a very unfriendly experience for consumers. Both in terms of hoops the consumer has to jump through to legally use the content they purchased, and also in terms of broken promises on the part of the vendors selling the protected content.

    MS's abandonement of WMA DRM, for example, is a breach of trust with its customers. They closed their MSN Music store, much to my and other's chagrin, and then stated in their FAQ that they'd made it "easy" for MSN Music customers to find their music on Zune Marketplace. It is nothing of the sort! It is especially not good news for MSN Music customers to learn that all that WMA DRM music they bought will not play on the new Zune MS is trying to sell them. Apparently, unless all your music is in MP3 or some such unprotected format (which MS supposedly discourages), you're going to have to start out with a totally new music library for your new shiny Zune. All purchased from their silly Zune Marketplace using their ludicrous point system.

    But I think there's an even bigger story here. In addition to breaking trust with their customers, Microsoft may well have alienated its hardware vendor partners now that vendors like Creative can see the writing on the wall that MS is not keen to keep PlaysForSure alive. Here they invested money and effort in implementing MS's technology in their hardware, not to mention the music stores that have done the same. Now these businesses find themselves looking toward an uncertain future now that MS will likely abandon them. This betrayal of MS's hardware and software partners is potentially as big a headline as their betrayal of their customers, if not bigger.

    I've like Microsoft generally for a long time. I've never been a big cheerleader of theirs, but I've come to their defense plenty of times. In this case, I think they have made a huge, huge miscalculation. Their over-agressive efforts to get into the digital audio/video player market and their accompanying abandonment of their customers (MSN Music) and partners is going to go down in history as a legendary cautionary tale for future businesses.
    Punchey
    • For now...

      [B]Content creators and distributors will always, ALWAYS, demand that their content be protected from theft.[/B]

      I agree, for the forseeable future, (2-3 years maybe), there will continue to be a DRM push. The problem is, just because they want it doesn't mean they can have it. No copyrighted content for sale with DRM exists without it's illegal counterpart on P2P. Not only that, fair use believers who bypass DRM for their own fair use (not to share) will always exist.

      It is a losing battle. Eventually, the hardware (firmware) and software manufacturers will get sick of the wasted $ in overhead to implement a fatally flawed desire.

      Again, they want it, they desire it, they are throwing money at it, but the buck stops in our wallets. If we won't buy it, what are they going to do, go out of business to spite us?

      MS's abandonment, Sony's fiasco simply help bring DRM to the public eye, and they don't like it, don't want it, and in no way enhances or provides anything to the customer.

      TripleII
      TripleII-21189418044173169409978279405827
    • No, it's not

      DRM is totally disposable. It's a waste of money, it doesn't work, it never has worked and it never will work. The only people making any money from DRM are those selling DRM, not those selling DRMed content.

      It will disappear. All that's needed are some new business models. The old ways of selling recorded music are dead in the water. Instead we'll see blanket licensing, new ways of financing musicians like http://www.sellaband.com , patronage and sponsorship. DRM is only inescapable if you insist on living in the past and keeping the current dinosaurs on their thrones.
      tic swayback
      • Disposible is right

        People have always found ways around DRM content. I for one have a MP3 player that can play Napster protected content on it, but it tends to skip when the song is encoded with DRM. So what do I do? I burn every track I buy onto a ReWritable CD disc, and then re-rip it to the computer without any DRM protection. Is that a violation? I still have license to listen to the music don't I? I should be able to play it on any electronic device I own from my home stereo, to my portable MP3 Flash Player. Who should dictate where I should be able to view or listen my purchased media? Next we are going to make magazines with invisible ink unless your thumb print matches or a voice print is accepted. Information is now being protected from infiltrating eyes and ears, rather than shared. Won't that slow down the progression of our society?
        kingkookie