MICROSOFT GETS JUMP ON EARLY DRM MARKET

Microsoft's announcement earlier this month that it will have SBC Communications and Lucent Technologies among others in its TV development stable is giving the company an early head start in one of the most important technologies for telcos getting into the video business — digital rights management.

Microsoft plans to include DRM capabilities that will secure video content from the headend of the telco to the set-top box. The company, which has yet to release any DRM tools related to its IP TV program, is planning on using the technology not just for security purposes but also as a tool that telcos can use to differentiate themselves, said Ed Graczyk, director of marketing for Microsoft TV.

“With digital rights management your content is secure, but you also can create new models for your paid content,” he said.

In one scenario, a telco could offer a pay-per-view movie for $3.99, but also allow users to “rent” that same movie for one week for $4.99 with the content being stored in the home or on the network.

While Microsoft certainly will be able to play off of its brand and relationship with Lucent, the DRM is just beginning to form and multiple implementations are still likely. Widevine Technologies, which is providing the security element for SaskTel's video-over-DSL deployment, encrypts only critical material within the video stream while leaving other parts untouched, according to John Hoskins, senior vice president of marketing and sales for Widevine. Because most carriers are looking at using IP as the transport protocol for their video services, studios and other content creators have been highly sensitive about telcos converting video material to a technology that is ripe for illegal copying.

“[Traditional] cable theft tends to be in the premiums, and the impact is that everybody loses $1 up the line,” Hoskins said. “Video-on-demand creates stationary content, and it's on an IP network. The toolset required to steal that can be downloaded over the Internet.”

Bill DeMuth, chief technology officer of SureWest Communications, which uses Irdeto Access for encryption of video content, said convincing content providers that their material would be safe from piracy was one of the biggest challenges.

“Early on, I had one of the major networks in to see how we were doing things,” he said. “The two things they were concerned about was quality of service and security.”