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Coral Consortium, the world's biggest DRM talking shop

Working for interoperability

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We're not quite sure how the name Coral came to be associated with Digital Rights Management last week, as the name taken on by a group of consumer electronics companies, one computer company, a DRM specialist and one of the content majors, but perhaps it's the way a coral under water seems to branch out and connect seamlessly to the next.

For those who missed the news, Intertrust, Philips and Sony last week added more top consumer electronics, content and technology heavyweights to an attempt to create an open interoperable Digital Rights Management environment. Climbing on board were Panasonic, Samsung, Hewlett-Packard and the News Cor- controlled film company Twentieth Century Fox, in a grouping called the Coral Consortium.

Perhaps the name Corral (with two R's) would have been preferred by many, bringing to mind images of the US frontier in the last century (and the one before), and herding wild stallions into containing corrals. DRM and containment are maybe immutably linked, after all.

But although Intertrust may be a US-originated firm, as is Hewlett- Packard, the power base within the Coral Consortium here belongs outside of the US, and perhaps that's why it never had the second 'R' in the name.

Sony's film making acquisitions are both from the US, and some of its music business, but it is a Japanese company, and Twentieth Century Fox is certainly a US firm, but it is now controlled by an Australian-US conglomerate.

Meanwhile Philips is clearly from the Netherlands and the rest of the consortium is resolutely from the Far East, Japan and Korea. There is enough US thinking in the group, but enough from outside of it to make a truly international standard. But a word of warning is needed.

While this group contains the biggest CE manufacturers on the planet and controls 60 per cent of the world's films, this is not a 'slam dunk', it is not a 'done deal' and there is about 12 months in which we may bite our fingernails and hope that this group don't blow it. It has but one chance.

Why? Well MPEG21 had all these guys as members in one way or another and that has never led to a viable DRM standard. Sure it had many other members, but this Coral group also wants to attract an irresistible force by adding lots more members. So it could end up in the same place.

What happened to MPEG 21 was that too many organizations had to agree on how the DRM stack worked and the regime had to work on too many different equipment types. Some people wanted it to work for the distribution of content through broadcasting, others wanted it to work over the internet for PCs and still more wanted it to work on content that is written onto rotating optical storage.

The upshot of this is that it never achieved any kind of consensus and it never got finished.

The world needs a standard for the distribution of content over the internet and that's what this technology needs to be about. Unlike MPEG21 it cannot be about DRM per se. This is not an attempt to establish a single way of doing DRM. No. It is an attempt to establish a single way of different DRMs talking to each other.

But the DRMs that need to talk to one another, first and foremost are those that protect content when it travels over the internet to either a PC or a Consumer Electronics device. Sure it would also be nice if the DRM rules persisted even when those content files were written to removable storage like DVDs.

But this is all about making content safe, when delivered as a stream or as a file, over the internet. Because once people realize what this unleashes no-one will want to consume content any other way.

The shift to instantaneously delivered content, from a choice of almost every piece of content that was ever made, is where this is all heading, and it is within our grasp.

The rising tide of technologically literate people on the planet with access to broadband lines is becoming vast, and will shoot to 147m this year, and 200m shortly after the end of next. This is the largest potential single entertainment audience every assembled, and it will only get larger and more comfortable with technology.

Certainly it will take years, but probably within five years the only lines being laid will be expected to run the IP protocol exclusively over them. And within 10 more years the rest of the 1.3bn telephone lines on the planet will almost all have broadband capability, giving the internet the type of potential that the dotcom boomers realised was there but could never deliver.

And that market can go two ways. It can develop new markets with new business models and new routes to market, with new economies. Or it can experience the biggest smash and grab story in the history of the planet with piracy running rampant and the old established content businesses either swept aside by new content companies that will play ball or by piracy.

If there are 200m potential customers by the end of next year, customers that will largely buy into home wireless networks and the on-demand driven, content consumption of the future and there is no content to put on their networks at home, they will either become disillusioned and stop buying technology or pirate and raid whatever is there.

We hear that the Coral Consortium will 'gather requirements' put out a 'specification' and call for technology to meet the spec and test that technology. This sounds awfully like the MPEG21 committees that these companies just left behind.

They all have technology, and they all have market power. They also have in Intertrust the intellectual property foundation for DRM. They should be able to give up their day jobs, and sit in room until they have bashed out that spec and then they should drive it through testing and do it jointly and then knock on the Digital Living Network Alliance door and demand that it adopt the standard.

If instead this becomes bogged down in discussion and disagreement, if too many other companies join the Coral Consortium and get a vote, and if becomes a glorified talking shop where nothing gets decided then it will be a disaster. If by the end of 2005 there is no DRM interoperability standard, working with most of the popular DRMs, that is widely accepted and promised on most modern CE equipment, then a darkness will fall across all the world's content businesses.

The spending on CE will stop, the DVD boom will fall away and new networks which make Kazaa look like it was coded on the back of a cigarette packet, will emerge, and a new brand of content kings will emerge from the businesses that adopt new approaches.

Could Viacom, Disney, Sony, Time Warner, NBC and Vivendi Universal all be holed below the water line by the coming wave? You betcha, if they screw up.

Could Sony, Microsoft and Philips all miss out on the IP content revolution? It could happen. They delay the new DRM interoperability standard at their peril.

Copyright © 2004, Faultline

Faultline is published by Rethink Research, a London-based publishing and consulting firm. This weekly newsletter is an assessment of the impact of events that have happened each week in the world of digital media. Faultline is where media meets technology. Subscription details here

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