Industry Confronts Content Security Conundrum

If service providers had their way, content distribution and pricing would be far simpler. But programmer business practices and more devices, as well as the specter of converged services, coming into play are only making these issues more complex.

“What would be easiest for everyone is paying one price per person to access content across all devices in the home, including portable media devices,” said Ibrahim Gedeon, CTO for IPTV pioneer and innovator TELUS Inc. “Charge by the human, not by the device. How are you going to keep pace with all the means of accessing video?”

That’s a valid question to which nobody has a current, workable solution. At present, content owners write different content carriage deals per distribution media, and frequently per primary device. That often means using different approaches, such as downloadable software, hardware appliances or both. This clearly has introduced complexity, takes time and slows the multiplatform distribution of media to the home. And it’s a reality that nobody wants to extend. But it’s still unclear as to whether and when it could change.

“I don’t think [digital rights management] issues are going to be resolved and be useful to content owners any time soon,” admitted William Myers, president and COO for premium movie owner Starz Entertainment LLC “We need to tie content use to the participating device. We’ve got to get to this.” Like other content owners, that’s the current thinking — different approaches for different devices, with content piracy still foremost in the minds of those who possess the prized asset.

Dom Stasi, president of TVN Entertainment and a former HBO executive, estimates the industry lost a collective $18 billion to piracy just a few years ago. “Content piracy is a high-profit margin industry,” he lamented.

That could be a key driver in increased spending on content security in the first calendar quarter of this year, according to market data from Infonetics Research.

The company expects growth in the second quarter to stay at 4 percent, but then increase to 5 percent in the third quarter, according to Jeff Wilson, a principal analyst with Infonetics. Growth in sales for the year will be up 24 percent over 2007, he predicted.

There’s more than one reason for increased focus on content security and DRM.

“The typical movie costs $100 million to make and advance promote, with only one in 10 showing an ROI in its theatrical release,” explained Jim Williams, CTO of the Motion Picture Association of America, which represents six of the major movie studios. Beyond viewing in the theater, consumers want choice, he continued. “But content owners want the terms and conditions of each choice to be honored,” he added.

Oftentimes, when an industry looks for structure on key issues and even solutions, it turns to standards creation and standards-recommending groups such as the ATIS IPTV Interoperability Forum (IIF). This organization has begun work on defining a hierarchy of security certificates designed to match the appropriate level of protection to the appropriate device.

“There are many more devices in the home, which means opportunity and challenges for digital rights management,” said Dan O’Callaghan, who chairs the ATIS-IIF and is a principal member of the technical staff for video architecture at Verizon Communications Inc.

The unit’s IPTV Security Solutions Committee has been looking at the issue of content security and DRM for some time, said O’Callaghan, and it is formulating a game plan that keeps content owners and service providers happy without restraining media access and sharing.

“We’re looking at defining a certificate hierarchy that has [device-specific] rules and addresses the multithreat mode,” he said. “The network may be secure, but not all devices are.”

In the meantime, content owners are opting for software-based solutions over software/hardware combos or hardware-only approaches, especially as they move to multiplatform distribution of their video programming.

That’s made Widevine Inc.’s downloadable software-only Cypher product a favorite. It is OS and platform independent and can be upgraded via the Internet. Industry giants AT&T Inc. and Cisco Systems Inc. hold stakes in the company.

A different approach for a different industry — broadcasters — is offered by Nagravision Inc. It protects the link, not its contents, from the broadcasting facility to the home. Yet other vendors, such as Verimatrix Inc., offer systems that focus on protecting pay-per-view content.

“We don’t encrypt or decrypt the signal to the set-top box,” began Robin Wilson, business development vice president with Nagravision. “Instead, we manage keys and rights. We also police and certify their robustness.”

With a wide array of security and DRM approaches and a growing list of devices seeking access to content, there’s no easy and simple way today for service providers to protect all the content they wish to distribute. The ATIS effort is promising, but will require time and intra- and inter-industry agreement.

There’s one approach, albeit unrealistic, that sounds like nirvana, but would require wholesales changes in the way content owners do business and create business models.

“Stop the [staggered] content distribution windows and make everything day-and-date,” suggested Bethany Gorfine, president and CEO of Federal Hills Communications, a consulting and advisory firm that helps content owners profitably distribute content. She was speaking in reference to the arrival of first-run movies in cinemas, which is followed by distribution to hotels, availability on DVR, availability on VoD pay-per-view and free, over-the air distribution. “People will pay for content if they get it in a timely manner and in an easy way.”

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