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Acquisition impacts software distribution market
http://searchwin2000.techtarget.com/originalContent/0,289142,sid1_gci992313,00.html
By Margie Semilof, Senior News Writer
12 Jul 2004 / SearchWin2000.com
More than a few customers of Installshield Software Corp. were surprised last month when this maker of a popular packaging and application manager software was snapped up by Macrovision Corp. to the tune of $76 million .
The surprise wasn't so much that Installshield was purchased. (The deal closed on July 1.) Rather, many of them had never heard of Santa Clara, Calif.-based Macrovision, which is better known in the entertainment industry for its toe-hold in digital rights management technology, and also for its licensing management software.
A combination of Macrovision and Installshield could create a powerhouse in terms of software distribution and licensing, said one expert. Near term, independent software vendors stand to gain the most from the merger, said Jonathan Eunice, president and principal analyst at Illuminata Inc., a Nashua, N.H., consulting firm.
"The real thrust of Macrovision/Installshield is how do we get to the distribution and licensing of software intellectual property," Eunice said. Macrovision's Flexnet software is used by many large software companies, including Adobe Systems Inc. and IBM, where there is concurrent licensing.
"I can see Macrovision becoming a one-stop-shop for software packaging, distribution and licensing -- that complex of issues of getting software into people's hands," Eunice said.
Knowing what you own
But ISVs are not the only ones that should be affected. The acquisition could also mean some changes for IT administrators and corporate software developers in terms of how they distribute and manage software and keep track of their licenses, which is already a big concern, Eunice said.
Many IT shops have programs with pieces of the puzzle already in place. "You've got to make sure what you use is actually what you own," said David Driggers, desktop system
team leader at Alabama Gas Corp., Birmingham, Ala. The utility already uses a license compliance system made by Tally Systems, of Lebanon, N.H.
For the many IT administrators today who use InstallShield's AdminStudio, Patch Impact Manager or Application Manager for the Enterprise, nothing will change, said Alain Breillatt , director of business development at Macrovision, who was formerly with Schaumburg, Ill.-based Installshield.
"We will continue to evolve, and we have a new release of AdminStudio coming out later this year," Breillatt said.
The other products will continue to be extended and expanded, he said.
What IT administrators can expect in the future are synergies developed between AdminStudio and Macrovision's Flexnet Manager toolset. Flexnet is an asset management software package that helps IT managers see how they are using their software licenses.
Both products are able to work together but there will be some integration of the two, Breillatt said. "Administrators don't want to put too many licenses out there because they are wasting money, but on the other hand, they don't want to under provide so their users can't get their work done," he said.
The products from both companies are entirely complementary so nothing will have to be phased out, said Daniel Greenberg, vice president of marketing at Macrovision.
Transforming Copy Protection from Roadblock to Rosetta Stone
http://www.linuxinsider.com/story/36314.html
The words "copy protection" make Adam Gervin wince. Gervin is senior marketing director for the entertainment technologies group at Macrovision, in Santa Clara, California. Macrovision is a company best known for cooking up ways to thwart the copying of movies and music from tapes and discs.
He's also point man in Macrovision's quest -- through a new release next quarter of its CD protection software, CDS-300 version 7.0 -- to recast its image from foe to friend of copying.
"We don't see the primary value of this product as being copy-protection," he said of the upcoming release of CDS-300.
"That isn't just marketing spin," he told TechNewsWorld. "When you create technologies like DRM [Digital Rights Management], portable players, jukeboxes and electronic stores, you create a tower of babble of standards."
Gervin maintained that Macrovision can create tremendous value for its products by allowing them to manage that tower of babble in a way that benefits both consumers and content owners, producers and distributors.
Management and Enhancement
"There's underlying level of protection that goes along with making DRM viable," he admitted, "but most of our work into our new products is going into music management and enhancement."
He maintained that the upcoming edition of CDS-300 will be Macrovision's first version to embrace that concept by supporting the most popular portable music players and jukeboxes of today, including Apple's (Nasdaq: AAPL) iTunes and iPod.
"We see that as a launching pad for a bunch of exciting things beyond Q4," he said. "There's a lot of opportunity to take music in new directions and provide more value to a consumer after they purchase a CD."
That added value, he continued, can include staying in touch with a band, exclusive opportunities to get additional content and the ability of a user to express creativity with the music.
It will also include software that will act as a kind of Rosetta Stone for the proliferating number of DRM schemes confronting consumers, he revealed.
When consumers attempt to rip music from CDs secured by Macrovision, that software will examine their computers, determine which music applications reside there, automatically create a tune with the appropriate DRM for that application and write it to their hard disk.
Burning with a Catch
Those tracks, however, will contain Macrovision's DRM, too, which will place additional restrictions on the tune. For example, consumers won't be able write tracks protected by DRM to an audio CD and then rip them from that CD to evade the DRM protection.
"You can't do the rip-the-disc to get around the DRM," Gervin said. "But you know what? You don't need to because you have all of the portability that you could ever want."
What's more, Macrovision's software will allow consumers to create playlists of songs from any major jukebox -- including purchased songs -- and burn them to a single CD.
Seamless Management Key
Before Macrovision's grand scheme can take hold, consumers must be assured that if they buy a secure CD, they'll be able to do what they want to do with its contents, Gervin explained.
"That can only happen," he reasoned, "if we provide a layer of seamless management over the DRM so the user gets the same experience in the DRM world that they did when there was no protection."
"That's why I don't want to call it protection," he said. "As soon as you say that, you bring out a product concept that's very consumer unfriendly and is created to say no."
Selling Consumers on DRM
"There's no doubt that an unprotected disc still provides the best unfettered options for consumers," he continued. "There's no way around that. But we hope, by focusing our effort on making portability in the DRM world as great as possible -- and providing extras like our compilation technology -- I think consumers will see the value of a music management and enhancement interface."
Those views are shared by Macrovision's chief competitor, SunnComm, of Phoenix, Arizona.
This spring, the company released a version of its CD security software that allows consumers to copy a protected audio CD a limited number of times. The copies can be played in any device that can play CDs, but they can't be copied.
Consumers Need Backups
"People need to make backup copies of their songs one way or another," CTO Eric Vanderwater told TechNewsWorld.
SunnComm's new version of its protection software also will convert tracks on a protected disc to computer files protected by Microsoft's (Nasdaq: MSFT) DRM scheme. Those files can be played on portable players compatible with that scheme.
Adding support for Microsoft's DRM has made garnering Apple's cooperation with SunnComm even more important, according to Vanderwater.
"We need to provide a solution where the users of iTunes can use the content on a CD the way they're used to using it but in a cop-managed environment that includes copying content from the CD onto the iPod in a protected format," he said.
"We acknowledge that that is a very important feature that needs to be addressed as soon as possible," he noted.
"We want to support fair use as much as possible," he declared. "Our technology is agnostic as far as what DRM technology is out there. Any DRM maker in the marketplace that's willing to work with us to convert our content into their DRM format, we will implement."
Macrovision CD Protection To Be Apple Compatible
http://www.technewsworld.com/story/Macrovision-CD-Protection-To-Be-Apple-Compatible-36061.html
It's as jarring as former First Lady Nancy Reagan saying yes to drugs.
The maker of the code hackers love to crack -- Macrovision -- is touting the sharing and copying features of the next version of its CDS-300 copy-protection scheme when it's released in this year's fourth quarter.
Those features include compatibility with Apple's (Nasdaq: AAPL) music management software, iTunes, and its best-selling digital music player, the iPod.
Some 350 million audio CDs have been sold outside the United States with earlier versions of CDS-300 that block music-ripping from the discs. But Macrovision is taking a different tack with the new edition of the software -- version 7.0 -- a tack it feels will be more acceptable to the U.S. market.
"We believe that version seven is the first version of CDS-300 that's ready for the Americas," Macrovision Senior Marketing Director Entertainment Technologies Group Adam Gervin told TechNewsWorld.
"That's predicated in supporting the hot digital player of the day, and that is the iPod," he said.
Apple Silent
Asked if the Santa Clara, California company had signed a licensing agreement with Apple to incorporate its digital rights management (DRM) scheme called FairPlay into the next version of CDS-300, Gervin responded, "I really can't comment about the relationship with Apple except to say that Apple works in the same ecosystem that we do, and I think it believes everyone would benefit through enjoying music in a DRM fashion as opposed to a non-DRM fashion."
Apple did not respond to phone calls and e-mails by TechNewsWorld seeking comment on its relationship with Macrovision.
According to Jarad Carleton, an IT industry analyst with Frost & Sullivan in Palo Alto, California, Macrovision's new software will be beneficial to Apple because it will allow consumers to rip songs from protected audio CDs and listen to them in iTunes and on an iPod.
Unreal Situation
"This is very important because the iPod is the most popular digital music player on the market, and if a CD is protected with DRM technology that doesn't allow consumers to transfer the music on the CD to their Apple iPod, you end up with a lot of very dissatisfied customers," he told TechNewsWorld via e-mail.
For just that reason, much consumer dissatisfaction was directed at Macrovision's major competitor, SunnComm, of Phoenix, Arizona, Carleton noted.
Because a Macrovision deal would benefit Apple, the situation between the companies is unlikely to degenerate into the state of war between the Cupertino, California Macintosh maker and RealNetworks (Nasdaq: RNWK) , which recently released desktop music management software that converts tracks bought at its music store into tracks that will play in Apple's products.
Significant Step for Apple
"Macrovision is providing value to Apple itself by creating a technology that not only protects music CDs but also helps to feed protected music into the Apple iPod, thereby increasing the value of an iPod for the mass consumer market," Carleton asserted.
"This is why I don't foresee Apple entering into litigation with Macrovision and suspect that there is a chance that Apple might be willing to license FairPlay to Macrovision," he said.
"I don't see this as a watershed event," added Ray Wagner, a research director at the Gartner Group in Stamford, Connecticut, "although it would mark a moderately significant step for Apple."
CD Survival
"Macrovision does not want to miss out on the iPod crowd, while it's a straight licensing deal for Apple that probably won't cannibalize iTunes, as opposed to the Real situation," he told TechNewsWorld.
Some analysts see Macrovision's move as a necessary one for the survival of the audio CD as a music medium.
"It's a realization that if the medium doesn't take into account these [online music] services, then people will begin bypassing that medium and simply purchase online," observed Rob Enderle, president and principal analyst of the Enderle Group in San Jose, California.
"You could certainly see a scenario where secure CDs were forced out of the market by a number of the online properties or forced into such a subservient position that they couldn't move much product," he told TechNewsWorld.
"They are responding to a competitive threat that if they didn't respond to could force them to leave the [market] segment," he added.
Telelogic Selects Macrovision Solution to Enable Flexible Software Licensing
Tuesday August 24, 3:00 am ET
One of the World's Largest Software Developers Standardizes on FLEXnet(TM) Publisher to Support Revenue Goals
LONDON--(BUSINESS WIRE)--Aug. 24, 2004-- Macrovision® Corporation (Nasdaq:MVSN - News) announced today that Telelogic has selected FLEXnet(TM) Publisher to manage all of its software licensing capabilities. Telelogic, the leading global provider of solutions for advanced systems and software development, has deployed Macrovision technology to solve a variety of critical business challenges, including product security and license control for various software
FLEXnet Publisher, a core component of Macrovision's FLEXnet universal licensing platform, helps software vendors flexibly price, package and protect their products and manage licenses throughout their lifecycle.
"Macrovision is clearly the most experienced and reliable provider of software licensing solutions, and we view them as an important partner," said Michael Gehrisch, Vice President of Information Systems at Telelogic. "We selected FLEXnet Publisher because of its unique ability to enhance our product development and sales capabilities as well as strengthen the relationships we have with our customers. FLEXnet is of key strategic importance to our business as we strive to increase sales by at least 10% over each of the next five years and look to expand our global customer base."
The Macrovision solution will also support Telelogic's international expansion efforts, especially in Asia, where there is a strong market opportunity for providing flexible licensing to enable a broad range of software packages with a high degree of security. FLEXnet Publisher enables Telelogic customers to select which products they want to test and purchase in virtually whatever form and model they prefer, from utility-based computing to automatic license generation. FLEXnet can also be tightly integrated into the product development process, which increases the security of Telelogic software and streamlines development costs.
Software licensing is a key component of Macrovision's software value management solutions, which include software installation, updating, packaging, entitlement management, end user management, and usage optimization.
About Macrovision
Macrovision Corporation (Nasdaq:MVSN - News) is the market leader in electronic licensing, installation, and digital rights management ("DRM") technologies. Macrovision's Software Technologies Group markets the FLEXnet universal licensing platform and the InstallShield suite of software installation, repackaging and update solutions, which are deployed on more than 500 million desktops worldwide. Over 50,000 software publishers and hundreds of Fortune 1000 companies use Macrovision technologies to maximize the value of their software. The company holds more than 700 software licensing, DRM and content protection patents worldwide. Macrovision is headquartered in Santa Clara, California and has offices worldwide. More information about Macrovision can be found at www.macrovision.com.
About Telelogic
Founded in 1983, Telelogic is the leading global provider of solutions for advanced systems and software development. The company's integrated best-in-class software tools, supported by professional services, enable companies to automate their entire development lifecycle, resulting in improved quality and predictability with reduced time-to-market and lower overall costs.
Headquartered in Malmo, Sweden with U.S. headquarters in Irvine, California, Telelogic has operations in 17 countries worldwide. Customers include Alcatel, BAE SYSTEMSM BMW, Boeing, DaimlerChrysler, Deutsche Bank, Ericsson, General Motors, Lockheed Martin, Motorola, NEC, Nokia, Philips, Siemens, Vodafone and Thales.
http://biz.yahoo.com/bw/040824/245204_1.html
Macrovision: iPod support for lock-in CDs in Q4
By Tony Smith
Published Monday 23rd August 2004 13:58 GMT
Copy protection provider Macrovision is sufficiently confident that it will be able to incorporate FairPlay support into its CDS-300 copy control that is has begun telling customers that it will add iTunes and iPod support to its software in Q4.
According to mailings sent out with the company's CDS-300 version 7 beta release, "support for iPod and iTunes... will be made available in a Q4 update".
The blurb claims that support will be enabled "via Apple FairPlay".
That suggests that Macrovision has indeed managed to license Apple's DRM technology - or is sufficiently confident of doing so that it can provide a timeframe for the code's adoption.
Macrovision called on Apple to license FairPlay earlier this year. Unlike Real Networks, however, it wants the technology to allow it to provide iTunes-ready compressed audio tracks alongside the Windows Media Audio files its CDS-300 copy protection mechanism already offers. Real wanted FairPlay simply so it could open its own online music store to iPod users.
The company's Q4 update is also expected to include its RealTime DRM Encoding system, which converts on the fly a disc's Red Book audio source into FairPlay-protected AAC files, ATRAC 3 tracks for Sony portable music players or WMAs, according to a given user's personal preference.
Reaching an agreement with Macrovision makes sense for Apple, since it will ensure that copy protected CDs no longer leave iTunes users out in the cold, but encompasses Mac buffs too. If we are going to have to face the mass release of protected discs, then we at least want them to support alternatives to Microsoft's software.
It also is another nod toward Apple's importance in the fledgling digital music market, that companies like Macrovision no longer feel all they need do is follow Microsoft. ®
http://www.theregister.co.uk/2004/08/23/macrovision_fairplay/
MVSN share holders,
60 minutes just had a segment entitled "Pirates of the Internet" hosted by Leslie Stahl. The segment dealt with media piracy. Unfortunately there was no mention of OUR Macrovision
DRM technology. I am now writing to 60 minutes and informing them that the entertainment industry has a viable ally with MVSN Tech.
I asking for a post script to be aired with mention of Macrovision. If you have a minute please do the
same. Even though we are the world leader in copy protection and DRM it never hurts to get the publicity.
Write to 60 Minutes at:
60 Minutes
524 West 57th St.
New York, NY 10019
EMAIL: 60m@cbsnews.com
PHONE: (212) 975-3247
Sony Teams with Smarte Solutions on Digital Rights Management; Partnership Produces Content Protection Solution For PC-Based Movies, Music and Digital Content
TOKYO & AUSTIN, Texas--(BUSINESS WIRE)--Aug. 12, 2004--Sony Corporation and Smarte Solutions, Inc. (or "Smarte"), a leading provider of Piracy Management solutions, today announced a partnership that has produced a market-ready digital rights management solution (DRM) for movie, music and other digital content files formatted for the PC. Under the agreement, Smarte will continue to develop DRM solutions for Sony for implementations on CD media.
The currently available joint solution, SmarteSECURE HTML, combines an innovative use of Sony's Postscribed ID(TM) (PID) technology with SmarteSECURE(TM) Intellectual Property (IP) protection technology. Sony PID is a new technology in which unique data, such as identification codes and serial numbers, are inscribed onto a CD-ROM after it has been manufactured. With PID technology, SmarteSECURE HTML protection is used to secure content including music and movie files, sensitive training materials, classified web material, as well as copyrighted text and images that are delivered on CD media.
"The use of PID technology is a natural fit within the security framework of SmarteSECURE," said Takumi Kanasashi, Senior Manager, Business Development, Sony Corporation. "The HTML multimedia protection solution that we are announcing today is just one example of how PID can be used with SmarteSECURE technology and the start of what promises to be a fruitful partnership for our Customers. Sony chose Smarte for this project over other competitors for its speed of implementation, compatibility with existing technology and strength of solution," continued Kanasashi.
"Smarte is delighted to have Sony as a Partner and Customer within the DRM space," said Bala Vishwanath, Smarte CEO. "We are equally as excited to demonstrate the flexibility and wide-ranging applicability of SmarteSECURE technology. This partnership will continue to provide integrated Piracy Management technologies across digital content verticals as Smarte delivers DRM solutions for Sony," continued Vishwanath.
About Smarte Solutions, Inc.
Since 1999, Smarte Solutions ("Smarte") has been designing and delivering Piracy Management solutions to the software and digital content publishing industry. Smarte has built a complete set of solutions to address issues of value surrounding secure product distribution and use management. The Company's product portfolio provides media-based, application-based, content-based, license-based, and user authentication-based protection of software and content. All technologies are enveloped in processes that improve customer cost efficiencies, revenue retention, and revenue enhancement. To learn more about Smarte Solutions, visit http://www.smartesolutions.com/.
http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20040812005...
ROTFLMAO!!!!!!!!!!!!!!!
Macrovision Sees Big Profits
By Rich Smith
August 3, 2004
Small-cap hunters like myself, and my co-subscribers to the Motley Fool's Hidden Gems small-cap newsletter, just love to find companies priced under $2 billion that turn in consistently great profits quarter after quarter. An interesting confluence of circumstances turned me on to one such possibility last night -- and it's a company that I have actually been following for a few months now: Macrovision (Nasdaq: MVSN).
Thanks to the magic of Amazon.com (Nasdaq: AMZN), I was watching the recently released DVD of Viacom's (NYSE: VIA) CBS division's erstwhile hit show, Northern Exposure. And what should I see patrolling the streets of Cicely -- before even the moose walked by -- but Macrovision's logo, following a strong suggestion that I refrain from any piratic disc-copying urges I might be entertaining.
A few hours earlier, Macrovision had released its second-quarter earnings numbers, and they were strong, too. Net income per share doubled over the year-ago quarter to $0.18; revenues were up 22%. Incidentally, both numbers topped Wall Street's estimates, leading to a surge in demand for Macrovision's shares on the after-hours market that has continued into today.
Now, Hidden Gems seekers enjoy generally accepted accounting principles profits as much as anyone (even as we mock Macrovision's recitation of "what-if" pro forma numbers). What we really like to see, however, is free cash flow -- preferably combined with a low enterprise value and a fast earnings growth rate. Macrovision has all of the above. At an enterprise value of $915 million, and with trailing free cash flow of almost $50 million, the company's EV/FCF is a respectable 18.3. Pair that with the company's projected growth rate of 20% over the next five years, and you have a company with serious gem potential.
Ordinarily, I view projected growth rates with a bit of skepticism -- predicting the future is a tough trick to pull off consistently. But when you look at Macrovision's past performance, laid out for your reading pleasure on Yahoo! (Nasdaq: YHOO) Finance's analyst estimates page, you will see that Macrovision has achieved the same 20% annual growth over the previous five years as well. That lends a bit more credence to the projected earnings numbers.
Putting it all together, at an EV/FCF/G ratio of about 0.9, Macrovision looks only slightly undervalued today. But if you keep an eye on this one, I suspect a buying opportunity will present itself eventually. It has happened before on some of Mr. Market's moodier days. It will happen again.
http://www.fool.com/News/mft/2004/mft04080317.htm?source=eptyholnk303100&logvisit=y&npu=y
MVSN Q2 2004 Conference Call Script – 1 – 8/2/04
Q2 2004 Earnings
Conference Call Script
August 2, 2004
(Bill Krepick – CEO
Welcome, ladies and gentlemen, to Macrovision’s Q2 2004 earnings conference call.
I am here today with Ian Halifax, our CFO, and Dan Stickel, EVP/GM of our Software
Technologies Group, to discuss with you our operating results for the second quarter
of 2004. As you’ve seen in our earnings release of today, we delivered record second
quarter revenues, pro forma operating income, and net income. We accomplished this
while during the same period announcing a major strategic acquisition of
InstallShield® Software Corporation. We also continued to make progress on our five
major investment initiatives that we outlined at the beginning of the year: music CD
copy protection; Peer-to-Peer (P2P) file sharing management and control; FLEXnet™
electronic license management/electronic license distribution product and sales
expansion; and DRM patent interference resolution. I’ll speak about our operations
and trends in the market after Ian discusses our Q2 2004 financial results.
Ian Halifax – CFO and EVP, Finance & Administration
Thanks, Bill.
Before I discuss the Company’s Q2 2004 operating results and our Q3 guidance
released earlier today, I would like to remind you that all statements made during our
conference call, that are not statements of historical fact, constitute “forward-looking
statements” and are made pursuant to the Safe-Harbor provisions of the Private
Securities Litigation Reform Act of 1995. Actual results could vary materially from
those contained in the forward-looking statements. Factors that could cause actual
results to differ materially from those in the forward-looking statements are described
in our Forms 10-K and 10-Q, other periodic filings with the SEC, and our press
releases.
A replay of this conference call will be available for one week through archived
Webcasts located on our Investor Relations website at
www.macrovision.com/company/investor/financial_news.shtml,
www.streetevents.com (for subscribers) or www.fulldisclosure.com.
MVSN Q2 2004 Conference Call Script – 2 – 8/2/04
The following financial information and the financial statements released earlier today
reflect the inclusion of acquired companies, except for InstallShield, which was
acquired on July 1, 2004. Therefore, Macrovision has presented pro forma
reconciliation income statements to show earnings before amortization of intangibles
from acquisitions, in process research and development write-offs, amortization of
deferred stock-based compensation and gains and impairment losses on investments,
in order to reflect both the historical and the ongoing operations of the combined
companies, as well as net income. We believe that this presentation may be more
meaningful in analyzing the results of operations and income generation.
As stated in our earnings release, consolidated net revenues for the second quarter of
2004 were $35,670,000 reflecting a 22% increase from $29,212,000 in the second
quarter of 2003.
Overall, revenues from our video technologies, which include copy protection for DVD,
videocassettes, and digital pay-per-view, increased 19% to $21,614,000 in the second
quarter of 2004 from $18,183,000 in the second quarter of 2003.
DVD copy protection revenues were $16,880,000 in the second quarter of 2004,
compared to $14,203,000 in 2003, an increase of 19%.
Second quarter copy protection revenues from videocassettes were $961,000 in 2004
compared to $1,271,000 in 2003, a decrease of 24%, driven by the ongoing shift from
the VHS format to DVD.
Digital pay-per-view copy protection revenues for the second quarter of 2004 were
$3,773,000, an increase of 39% from $2,709,000 in Q2 2003.
Revenue from the Company’s music copy protection products was $1,045,000,
reflecting a 4% decrease compared with Q2 2003. We continue to see our business
coming from Japan and Western Europe.
SafeDisc® revenues for our PC games business were $1,004,000, down 25% from Q2
2003.
Revenue from the Company’s software products was $12,007,000 in the second
quarter of 2004, compared to $8,531,000 in 2003, an increase of 41% resulting from
new license transactions and renewals of existing contracts.
Gross margin for the second quarter of 2004 was 94% (excluding amortization of
intangibles from acquisitions), consistent with the second quarter of 2003.
MVSN Q2 2004 Conference Call Script – 3 – 8/2/04
Pro forma operating income (before amortization of intangibles from acquisitions, in
process research and development write-off, amortization of deferred stock-based
compensation and gains and impairment losses on investments) for the second
quarter of 2004 was $13,834,000 or 13% higher than the second quarter of 2003,
which was $12,223,000.
Pro forma earnings for the second quarter of 2004 were $9,486,000 or 14% higher
than the second quarter of 2003, which were $8,351,000.
Net income for the second quarter of 2004 was $8,843,000, an increase of 93% over
the second quarter a year ago, which was $4,591,000. Impairment losses on our
private company investments had a material impact on net income in the second
quarter a year ago.
Our pro forma operating margins were 39% of revenues in Q2 2004, down from 42%
in Q2 2003. This stems from the strategic investment initiatives we are making in R&D
and Sales & Marketing.
Pro forma diluted earnings per share for the second quarter of 2004 were $0.19, up
12% from the $0.17 recorded in the prior quarter a year ago. Diluted net earnings per
share for the second quarter of 2004 were $0.18, double the $0.09 recorded in the
prior quarter a year ago.
Interest and other income was $985,000 for the quarter, up from $953,000 in Q2
2003.
Our cash position remains strong. The total of the Company’s cash and cash
equivalents, short-term investments and long-term marketable investment securities
balance as of June 30, 2004 was $302,417,000.
The accounts receivable balance as of June 30, 2004 was $22,266,000. DSO (days’
sales outstanding) was 57 days as of June 30, compared to 72 days in the prior
quarter a year ago.
Deferred revenue was $12,325,000 at the end of the second quarter, compared to
$11,163,000 in the second quarter a year ago, an increase of 10%.
Revenues for the third quarter of 2004 are estimated to be in the $45-$47 million
range, with pro forma EPS of $0.18-$0.19. For the full year 2004, we anticipate
revenues of $170M-$175M, with pro forma EPS of $0.86-$0.88. These projections
include the impact of InstallShield Software Corporation acquisition for the second half
of the year. Our guidance for Macrovision as a standalone business for the year is
MVSN Q2 2004 Conference Call Script – 4 – 8/2/04
consistent with that provided last quarter. InstallShield will contribute $9-$10 million
in revenue in the third quarter (net of the accounting treatment relating to
InstallShield’s deferred revenue), with a neutral impact on pro forma earnings per
share as a result of interest income foregone and incremental expenses we expect to
incur relating to integration activities.
Now, let me turn the microphone over to Bill who will discuss the significant highlights
of the quarter and the trends in our various businesses and markets.
Bill Krepick - CEO
Thanks, Ian.
Our Q2 2004 DVD copy protection revenues grew by 19% year-over-year to $16.9
million which reflects continued strength in the DVD software business and continued
growth by our customers who copy protect the vast majority of their DVD titles.
The quarter was important because we launched our Hawkeye™ P2P file sharing
management and control system. We are supporting a number of trials with both the
movie studios and record companies. On the music side, we completed several beta
trials with independent labels and majors, and we have signed one independent label
for commercial usage. We have several other Hawkeye service contracts in negotiation
for both music tracks and movies. We believe the Hawkeye P2P protection service is a
significant complement to our CD and DVD copy protection technology, as it works
hand in hand with physical media content protection to minimize the proliferation of
unauthorized digital files on the Internet. In the past year, many high profile movies
have been illegally copied onto a camcorder in a movie theatre and then compressed
and digitally uploaded to file sharing networks. By using Hawkeye in a short field trial,
one studio customer found that no unauthorized files of a hit movie appeared on the
leading file sharing networks. The studio believes that our technology is effective in
addressing this form of piracy and agreed to license our P2P file sharing services on
this title for the next 6 months. We expect other studios will be trialing Hawkeye
during Q3 2004.
In the SafeDVD area, we have renamed our anti-ripper product, RipGuard™. This
product is designed to combat the software ripper products like 321 Studios’ DVD X
Copy. We were gratified to see that our litigation against 321 Studios resulted in a
court awarded injunction. Our RipGuard product is designed to be the technologic
antidote to 321 Studios and other software ripper clones that are used to make copies
of DVD movies. During the quarter we demoed the RipGuard silver production discs to
MVSN Q2 2004 Conference Call Script – 5 – 8/2/04
four of the major studios and received very positive feedback. We are continuing to
refine our RipGuard solution and are still on track for a Q4 2004 commercial launch.
An announcement two weeks ago regarding a new encryption standard and content
management system for next generation high definition DVDs raised questions
regarding its impact on Macrovision’s DVD copy protection business. The short answer
is that we see more opportunities than threats from this consortium. We believe that
the consortium of 8 companies, called the Advanced Access Content System Alliance
(AACS), is mostly concerned with implementing a more robust security system that
will overcome the deficiencies of the current CSS access control encryption which is
used on today’s DVDs. We are confident that our current video content protection
solutions - namely our DVD copy protection, Hawkeye P2P file sharing management,
and RipGuard anti-ripper technologies offer the most comprehensive copy protection
solutions for rights holders. In addition, our engineers have developed a way to
piggyback additional rights control information on our DVD and PPV copy protection
solution which can be used to control the storage and playback of digital DVD, PPV
and VOD programs on PVR type set top boxes and home media PCs. We are calling
this solution ACP-E. If we are successful in marketing this solution, it will provide us
an opportunity to seek incremental set-top box, PVR/DVR and content royalties.
Our copy protection business for digital pay-per-view applications increased 39% to
$3.8 million, which reflected continuing strong demand for copy protection-enabled
digital set-top boxes around the world. We continued to work with several U.S. cable
operators and their hardware suppliers to test video-on-demand copy protection
activation and we expect that activation on one or more systems will occur some time
in 2004.
Our SafeDisc PC games copy protection business delivered $1 million in revenue,
which was 25% below Q2 2003, but 13% above last quarter. The PC games business
continues to show nominal growth and we believe we are the leading supplier of copy
protection technology. We also believe that games publishers are becoming
increasingly aware of the strength of our solution compared with Sony’s SecureROM,
our major competitor.
In the audio market, we generated $1 million in revenues in Q2, all of which came
from Europe and Asia. This was slightly below Q2 of 2003. Our product development
team completed work on our newest version of the CDS-300™ product, and we are in
the process of delivering CDS-300 version7 CDs to the major record labels around the
world. This version of the product has both an ‘active’ and a ‘passive’ copy protection
solution, a built-in Microsoft DRM, and a proprietary Macrovision controlled burning
feature. The record label can choose whether to invoke the active or passive copy
protection scheme, and can set the controlled burning feature to a limited number of
MVSN Q2 2004 Conference Call Script – 6 – 8/2/04
copy protected burns on the consumer’s CD-R device. With the addition of active
software copy protection, the major record companies can balance the level of
protection between our active driver installation and our passive protection.
Macrovision has significant experience in active protection as this was the basis for CDilla’s
CD-Secure and SafeDisc solutions dating back to the mid-1990 timeframe.
Macrovision currently ships an active software driver for SafeDisc in Windows XP.
There is a tradeoff between active and passive protection in terms of playability and
ease of circumvention and we understand that a couple of the major record labels
believe the active solution has 5-10% better playability characteristics than the
passive solution, and they believe that level of playability is worth sacrificing hack
resistance. We hope that the record labels will release albums with Version7 in Q3
2004 in the U.S. and around the world.
There is not much to report on the InterTrust Interference action, other than the case
is proceeding with the U.S. Patent Office administrative judge and both ourselves and
InterTrust have responded to the judge’s request for documentation and other proof
supporting the earliest invention dates and reduction to practice dates for each of the
patent claims. Over the next several months the judge will be studying the
information and asking each side to respond to his questions. In the meantime, we
will continue to pursue a positive outcome through discussions with potential DRM
licensors and licensees.
Turning now to our software business, Q2 2004 was another record second quarter for
our Software Technologies Group. Our combined enterprise and consumer licensing
businesses delivered $12.0 million in revenues vs. $8.5 million a year ago, reflecting a
Y/Y growth rate of 41%. We continue to have success in converting our healthy sales
pipeline into larger deals, and closed significant new business with companies such as
Hyperion, Synopsis, Schlumberger, and others. We also sold our first three FLEXnet
Manager systems, a new product launched in May that we sell directly to enterprise
end user customers of FLEXenabled software. FLEXnet Manager is a new expanded
enterprise version of our existing Software Asset Management (SAM) product line. In
terms of the overall Software Value Management ecosystem, Platform Computing
announced in June that they intend to use our FLEXnet Connector interface to the
FLEXnet platform, enabling their products to work more efficiently with the large array
of FLEXenabled™ software on the market.
In mid-June we announced our intent to acquire InstallShield, and closed the
acquisition on July 1. The customer reaction to the InstallShield acquisition has been
very positive. Our respective customers appreciate the fact that we now have
increased the breadth of our Software Value Management solutions and are building a
one-stop shopping experience for ISVs and enterprises to help them more efficiently
package, license, install, update, and administer their software applications. We have
MVSN Q2 2004 Conference Call Script – 7 – 8/2/04
combined the operations of our two companies, and already have unified sales,
marketing, customer support, professional services, and engineering functions. Last
week we announced, with IBM, a beta program for the InstallShield multi-platform
installer to support IBM’s autonomic computing initiative. And, we have kicked off an
internal project to define an integrated approach with our FLEXnet product activation
package and the InstallShield installer product that will provide an easy way for the
large InstallShield Installer customer base to learn about FLEXnet offerings and the
value management solutions we provide to software publishers.
We talked in prior conference calls about the need to step up our rate of investment
inside the Company in 2004 in order to position us better to capitalize on the shifts
taking place in digital media – especially with the increasing emphasis on Internet and
web-based distribution. We think we have demonstrated in the first half of 2004
substantial progress in this regard, and we have maintained a high level of profitability
with our year-to-date pro-forma operating margins at 41%, and our revenues growing
a healthy 29% year-over-year. Our Q1 and Q2 performance demonstrated across-theboard
strength in our existing businesses, while our progress with new products has
us on track to expand our business further as the year progresses. In addition, our
acquisition of InstallShield gives us further opportunities to expand our business by
leveraging complementary products, sales forces and channels, and an expanded
customer footprint.
We thank you for your continued support, and now we’ll take any questions.
http://www.macrovision.com/company/investor/financial_news.shtml
Macrovision's InstallShield X Achieves Broad Market Acceptance; Cisco, Websense Reaping Benefits of InstallShield Cross-Platform Installation Solution
2 August 2004, 11:00am ET
SANTA CLARA, Calif.--(BUSINESS WIRE)--Aug. 2, 2004--Macrovision(R) Corporation (Nasdaq:MVSN) today announced that the newest release of its flagship installation authoring solution, InstallShield(R) X, is receiving high marks from users and is gaining widespread adoption. Customers such as Cisco Systems and Websense, Inc. are praising InstallShield X for greatly improving the multi-platform software installation process.
InstallShield X, released in May, is the first solution to enable software developers to author industry-standard installations targeting virtually any platform, operating system and device. As the successor to both InstallShield DevStudio and InstallShield MultiPlatform, InstallShield X is the most comprehensive and robust installation-authoring product on the market today. With InstallShield X, customers dramatically cut development time and support costs while improving communications with their end-users.
Customer Success
Cisco Systems (Nasdaq:CSCO), the worldwide leader in networking for the Internet, chose InstallShield X to meet the increasing need to install its solutions on multiple platforms in a standardized manner giving customers a consistent look and feel.
"InstallShield X reduces our development costs by supporting all of our target platforms, and decreases the time we spend on native installation methods," said John Patton, Software Engineer at Cisco Systems. "Having scaled to meet our installation needs, it allows us to integrate multiple projects into one solution creating a single setup that anyone on our team can use. Because the first thing our customers see when using our product is the installation, it's important for us to have a solution that gives our customers confidence throughout the install and uninstall processes."
Websense, Inc. (Nasdaq:WBSN), the leading provider of employee Internet management (EIM) solutions, chose InstallShield X for its ability to deliver fast installation development for multiple platforms.
Mentioned Last Change
CSCO 20.74 0.50dollars or (2.35%)
MVSN 22.37 1.32dollars or (6.27%)
WBSN 36.96 0.62dollars or (1.64%)
"Using InstallShield X the benefits became obvious," said Willhelm Lehman, Software Installation Architect at Websense, Inc. "Our development process is now streamlined to a single code base for all platforms. This saved us money by allowing us to hire Java developers who focused on installation development on a common platform instead of concentrating on arcane UNIX shell scripting semantics. In turn, our UNIX customers were very impressed because our installation process was finally able to resemble the Windows installation."
"Developers today want to be able to distribute their applications to as many platforms as possible with one tool. For example, Linux developers want to write one setup which will deploy to all Linux distributions. Rather than make them use multiple products with dissimilar IDEs and features, we simplified the experience," said Bob Corrigan, InstallShield Product Manager at Macrovision. "We are thrilled to see customers like Cisco and Websense reaping the benefits of InstallShield X."
Software installation is a key component of Macrovision's software value management solutions, which include software updating, packaging and licensing, entitlement management, end user management, and usage optimization.
About Macrovision
Macrovision Corporation (Nasdaq:MVSN) is the market leader in electronic licensing, installation, and digital rights management ("DRM") technologies. On July 1, 2004, Macrovision acquired the assets of InstallShield Software Corporation. Macrovision's Software Technologies Group markets the FLEXnet universal licensing platform and the InstallShield suite of software installation, repackaging and update solutions, which are deployed on more than 500 million desktops worldwide. Tens of thousands of software publishers and hundreds of Fortune 1000 companies use Macrovision technologies to maximize the value of their software. Macrovision holds more than 700 software licensing, DRM and content protection patents worldwide. Macrovision is headquartered in Santa Clara, California and has offices worldwide. More information about Macrovision and the InstallShield line of products can be found at www.macrovision.com and www.installshield.com .
InstallShield is a registered trademark of Macrovision Corporation in the United States and/or other countries. All other brands and product names are trademarks or registered trademarks of their respective companies.
This press release may contain "forward-looking" statements as that term is defined in the Private Securities Litigation Reform Act of 1995. A number of factors could cause Macrovision's actual results to differ from anticipated results expressed in such forward-looking statements. Such factors are addressed in Macrovision's filings with the Securities and Exchange Commission (available at www.sec.gov ). Macrovision assumes no obligation to update any forward-looking statements.
CONTACT: Macrovision Corporation
Gerold Franke, 847-466-4300
gfranke@macrovision.com
or
LaunchSquad
Jason Mandell or Jesse Odell, 415-625-8555
mvsn@launchsquad.com
SOURCE: Macrovision Corporation
Macrovision Corporation Reports Record Second Quarter 2004 Revenues
2 August 2004, 4:30pm ET
SANTA CLARA, Calif.--(BUSINESS WIRE)--Aug. 2, 2004--Macrovision Corporation (Nasdaq:MVSN) announced today that second quarter 2004 net revenues were a record $35.7 million, compared with $29.2 million in the second quarter of 2003, an increase of 22%. Pro forma earnings (before amortization of intangibles from acquisitions, non-cash deferred compensation expense, and impairment gains and losses on investments) were $9.5 million or 14% higher than the $8.4 million recorded in last year's second quarter. Pro forma diluted earnings per share for the quarter were $0.19, or 12% higher than the comparable pro forma earnings per share of $0.17 in the second quarter a year ago.
Net income for the second quarter of 2004 was $8.8 million or 93% higher than the $4.6 million recorded in the second quarter a year ago. Diluted earnings per share for the quarter were $0.18, or 100% higher than the comparable earnings per share of $0.09 in the second quarter a year ago.
Cash and cash equivalents, short-term investments and long-term marketable securities were $302.4 million as of June 30, 2004.
"We are very pleased with our second quarter results," said Ian Halifax, CFO at Macrovision. "Our revenues benefited from continued strong performance in our DVD and pay-per-view (PPV) copy protection business and our enterprise software value management business. The second quarter was important to us for a number of reasons, including the announcement of our acquisition of InstallShield(R) Software Corporation; important legal victories that establish a broad scope for key patents related to the Company's software licensing solutions; the introduction and first sales of FLEXnet(TM) Manager, our software asset management system; and the successful launch of our Hawkeye(TM) peer-to-peer file sharing content management service. Revenues for the third quarter of 2004 are estimated to be in the $45-$47 million range, with pro forma EPS of $0.18-$0.19. For the full year 2004, we anticipate revenues of $170M-$175M, with pro forma EPS of $0.86-$0.88. These projections include the impact of the InstallShield acquisition for the second half of the year."
The Company continues to use pro forma reconciliation condensed consolidated statements of income in the presentation of financial results and earnings guidance. Management believes that this presentation may be more meaningful in analyzing the results of operations and income generation, as non-cash, non-operating or non-recurring items (such as amortization of intangibles from acquisitions, amortization of deferred stock-based compensation, impairment losses on investments, in-process research and development write-off and restructuring charges) are excluded from the pro forma earnings calculation. This presentation may be considered more indicative of our ongoing operational performance. The tables below present the differences between pro forma earnings and net income on an absolute and per share basis.
Immediately following the Q2 earnings release, Macrovision will hold an investor conference call on August 2, from 5:00 p.m. to 6:00 p.m. EDT. Investors and analysts interested in participating in the conference are welcome to call 800-218-0713 (or international +1 303-205-0033) and reference the Macrovision call.
The conference call can also be accessed via live Webcast at www.macrovision.com/company/investor/financial_news.shtml or www.fulldisclosure.com (or www.streetevents.com for subscribers) on August 2, 2004 at 5:00 p.m. EDT. Approximately 1-2 hours after the live Webcast ends, the on-demand Webcast of Macrovision's earnings conference call can be accessed until August 9, 2004.
Investors and analysts interested in listening to a recorded replay of the conference are welcome to call 800-405-2236 (or international +1 303-590-3000) and enter passcode 11003547#. Access to the replay is available through August 3, 2004. The conference call script will be posted on the Company's website approximately 48 hours following the call and will be posted for 30 days.
About Macrovision
Macrovision develops and markets digital product value management solutions for content publishers, software publishers, and enterprise IT departments. Macrovision's content protection technologies are embedded in over 8.5 billion DVD, VHS, and CD units representing over $115 billion of protected entertainment content. In addition, over 280 million DVD devices and digital set-top boxes contain Macrovision's technology. Our software solutions are deployed on more than 500 million desktops worldwide, and over $70 billion of software has been FLEXenabled. Macrovision holds a total of 759 issued and 479 pending United States and international patents, and continues to increase its patent portfolio with new and innovative technologies in related fields. Macrovision has its corporate headquarters in Santa Clara, California, key development labs and sales/service centers in Schaumberg, IL and the UK, and other international offices in Amsterdam, Tel Aviv, Tokyo, Hong Kong, Taipei and Seoul. More information about Macrovision can be found at www.macrovision.com .
Note to Editors: For more information on Macrovision Corporation and its products, please visit www.macrovision.com .
All statements contained herein, including the quotations attributed to Mr. Halifax, as well as oral statements that may be made by the Company or by officers, directors or employees of the Company acting on the Company's behalf, that are not statements of historical fact, including statements that use the words "will," "believes," "anticipates," "estimates," "expects," "intends" or "looking to the future" or similar words that describe the Company's or its management's future plans, objectives, or goals, are "forward-looking statements" and are made pursuant to the Safe-Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include the Company's forecast of future revenues and earnings, the business strategies and product plans of the Company and the features and benefits of the products of the Company.
Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause the actual results of the Company to be materially different from the historical results and/or from any future results or outcomes expressed or implied by such forward-looking statements. Among the important factors that could cause results to differ materially are the following: the failure of markets for home video, audio CDs, consumer or enterprise software value management, or markets for the technological protection of copyrighted materials contained in such products, to continue, develop or expand, and the failure of the Company's products to achieve or sustain market acceptance or to meet, or continue to meet, the changing demands of content or software providers. Other factors include those outlined in the Company's Annual Reports on Form 10-K for 2003, its Quarterly Reports on Form 10-Q, and such other documents as are filed with the Securities and Exchange Commission from time to time. These factors may not constitute all factors that could cause actual results to differ materially from those discussed in any forward-looking statement. The Company operates in a continually changing business environment and new factors emerge from time to time. The Company cannot predict such factors, nor can it assess the impact, if any, of such factors on the Company or its results. Accordingly, forward-looking statements should not be relied upon as a prediction of actual results. The Company is not obligated to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.
Mentioned Last Change
MVSN 22.37 1.32dollars or (6.27%)
Macrovision provides pro forma earnings and pro forma earnings per share data as additional information for its operating results. These measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from pro forma measures used by other companies. Macrovision believes that this presentation of pro forma earnings and pro forma earnings per share provides useful information to management and investors regarding certain additional financial and business trends relating to its financial condition and results of operations. In addition, Macrovision's management uses these measures for reviewing the financial results of Macrovision and for budget planning purposes.
Macrovision Corporation and Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
(In thousands, except per share data)
Three Months Six Months
Ended June 30, Ended June 30,
----------------- -----------------
2004 2003 2004 2003
-------- -------- -------- --------
Net Revenues $35,670 $29,212 $73,652 $57,264
Costs and expenses:
Costs of revenues, including
amortization of intangibles of
$777 and $856 for the three
months ended June 30, 2004 and
2003, respectively, and $1,556
and $1,712 for the six months
ended June 30, 2004 and 2003,
respectively 3,240 2,636 6,324 4,974
Research and development 5,708 4,156 11,295 7,899
Selling and marketing 8,770 6,472 17,326 12,876
General and administrative 5,120 4,648 10,633 8,972
Deferred compensation
expense relating to
Globetrotter - 752 185 1,520
Impairment losses (gains) on
investments - 3,850 (1,040) 3,850
-------- -------- -------- --------
Total costs and expenses 22,838 22,514 44,723 40,091
-------- -------- -------- --------
Income before interest and income
taxes 12,832 6,698 28,929 17,173
Interest and other income, net 985 953 1,713 2,053
-------- -------- -------- --------
Income before income taxes 13,817 7,651 30,642 19,226
Income taxes 4,974 $3,060 11,031 7,690
-------- -------- -------- --------
Net income $8,843 $4,591 19,611 11,536
======== ======== ======== ========
Diluted earnings per share $0.18 $0.09 $0.39 $0.24
======== ======== ======== ========
Shares used in computing diluted
earnings per share 50,411 49,299 50,311 49,038
======== ======== ======== ========
Macrovision Corporation and Subsidiaries
Pro forma Reconciliation of Condensed
Consolidated Statements of Income (Unaudited) (1)
(In thousands, except per share data)
Three Months Six Months
Ended June 30, Ended June 30,
--------------- -----------------
2004 2003 2004 2003
------- ------- -------- --------
Net income $8,843 $4,591 $19,611 11,536
Add:
Amortization of intangibles from
acquisitions (net of taxes) 643 585 1,290 1,119
Deferred compensation expense
relating to Globetrotter - 752 185 1,520
Impairment losses on investments
(net of taxes) - 2,423 (670) 2,423
------- ------- -------- --------
Pro forma net income $9,486 $8,351 $20,416 $16,598
======= ======= ======== ========
Diluted earnings per share
reconciliation:
Net income $0.18 $0.09 $0.39 $0.24
Add:
Amortization of intangibles
from acquisitions (net of
taxes) 0.01 0.01 0.03 0.02
Deferred compensation expense
relating to Globetrotter - 0.02 - 0.03
Impairment losses on investments
(net of taxes) - 0.05 (0.01) 0.05
------- ------- -------- --------
Pro forma diluted earnings per
share research and development $0.19 $0.17 $0.41 $0.34
======= ======= ======== ========
Shares used in computing diluted
earnings per share 50,411 49,299 50,311 49,038
======= ======= ======== ========
Notes: (1)
Pro forma results for the three and six months ended June 30, 2004 and
2003 are presented for information purposes only. These results
present the operating results of Macrovision Corporation, excluding
costs associated with amortization of intangibles from acquisitions,
amortization of capitalized patents from our acquisition of TTR's
assets in the second quarter of 2003, deferred compensation expense,
and impairment losses on investments. These costs were $643 for the
three month period ended June 30, 2004, and $805 for the six month
period ending June 30, 2004, net of taxes when applicable, using the
Company's pro forma effective rate. The amortization expense for
capitalized TTR patents included in cost of revenues was $225 and $450
for the three and six months ended June 30, 2004, respectively. The
format presented above is not in accordance with Generally Accepted
Accounting Principles.
Macrovision Corporation and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
(In thousands)
June 30, December 31,
2004 2003
------------- ------------
ASSETS
Cash and cash equivalents $140,350 $27,918
Short-term investments 64,234 95,563
Accounts receivable, net 22,266 30,169
Prepaid expenses and other assets 18,056 15,079
------------- ------------
Total Current Assets 244,906 168,729
Property and equipment, net 7,575 6,689
Patents and other intangibles, net 11,010 10,826
Long-term marketable investment
securities 97,833 146,151
Goodwill 29,434 28,630
Other intangibles from
acquisitions, net 7,040 8,512
Other assets 16,177 16,029
------------- ------------
TOTAL ASSETS $413,975 $385,566
============= ============
LIABILITIES
Accounts payable $5,660 $4,457
Accrued expenses and income taxes
payable 26,097 25,936
Deferred revenue 12,325 10,333
------------- ------------
Total Current Liabilities 44,082 40,726
Other liabilities 1,022 874
------------- ------------
TOTAL LIABILITIES 45,104 41,600
STOCKHOLDERS' EQUITY 368,871 343,966
------------- ------------
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY $ 413,975 $ 385,566
============= ============
CONTACT: Macrovision Corporation
Ian Halifax, 408-743-8600 (Investors)
ir-info@macrovision.com
SOURCE: Macrovision Corporation
SunnComm International Announces Major Breakthrough in CD Copy Management Technology
PHOENIX, AZ, July 30, 2004 — SunnComm International, Inc. (OTC: SCMI), the developer of MediaMax™, the most widely used and accepted audio CD copy management and enhancement technology in the United States, announced today that it has achieved a major breakthrough in CD content protection technology. As part of SunnComm’s ongoing commitment to raise the bar for copy management solutions, it has developed new technology that will significantly enhance the security for MediaMax protected discs while remaining 100% playable in consumer CD/ DVD players. Protection components embedded on the optical medium will now make it impossible for the user to play the disc without installing the MediaMax software. As with all MediaMax products, once installed the user will not only be able to play the disc but will have access to numerous features and bonus content not found on conventional audio CD’s. The beta release containing the new technology is to be tested by a select group of international record labels by the end of Q3/04.
This leap forward in technology provides a very strong answer to some critics who believed that holding the infamous shift-key offered an acceptable work-around for MediaMax protected discs. It provides the necessary support to ensure that the CD buyer will be given the option to use the music they have purchased in a legal, responsible way while protecting the artists and content owners’ rights. SunnComm’s president, Peter H. Jacobs, stated, “Everyone at SunnComm believes that the best digital security technology should be ever mindful of the consumer experience. We now have the tools to build on a very effective and well-received CD security platform, making it the most widespread and strongest CD security solution available anywhere.”
Bill Whitmore, QuietTiger’s president, adds, “SunnComm has had the leading CD copy management solution for a couple of years and this exciting breakthrough brings us to a new level of security.” SunnComm’s Chief Technology Officer, Eric Vandewater, affirmed, “We designed this new technology to integrate directly and seamlessly into SunnComm’s current suite of MediaMax products and to ensure the copyrighted content is protected as soon as the disc is inserted in the drive of a computer regardless of subsequent user actions.”
SunnComm’s MediaMax suite of products delivers security for digital CD audio along with an enhanced consumer experience that provides additional bonus content and value-added features. MediaMax is wrapped in a user-friendly multi-media session environment, mastered directly on the audio CD, and accessible using a personal computer. Bonus features include artist-related promotions, videos, song lyrics, artist bio page, photo gallery, web links, on-board press kits, and tune-sharing capability through SunnComm’s MusicMail™ functionality.
Macrovision Announces the Beta of InstallShield for IBM Solution Installation
Friday July 16, 7:00 am ET
InstallShield Product Supports IBM's New Solution Installation for Autonomic Computing Initiative
SANTA CLARA, Calif.--(BUSINESS WIRE)--July 16, 2004-- Macrovision® Corporation (Nasdaq:MVSN - News) today announced the public beta program for its new product line, InstallShield for IBM Solution Installation. The industry standard for software installations, InstallShield technology is uniquely positioned to support IBM's new Solution Installation for Autonomic Computing. This new functionality was developed in partnership between InstallShield and IBM to provide a common approach to software packaging that will allow developers to more efficiently deploy and maintain their applications across a wide variety of platforms.
"As an IBM Business Partner, InstallShield has been a key contributor in forming this standard for software installation," stated Alan Ganek, Vice President, Autonomic Computing at IBM. "Solution Installation for Autonomic Computing enables developers to cut time-to-market and development costs while enabling customers to achieve error-free software configurations."
"As the clear leader in installation technology, one of the challenges we have witnessed has been a lack of underlying standardization," says Brian Vile, vice president of Installation tools at Macrovision. "InstallShield for IBM Solution Installation seeks to address this issue. In order to ensure its success and adoption, IBM naturally approached InstallShield. We collaborated in designing the new open standard, which benefits developers and end users alike."
Software installation (and updates) are a key component of Macrovision's solutions for software value management, which also include software licensing, entitlement management, end user management, and usage optimization.
InstallShield for IBM Solution Installation provides a powerful and extensible solution that works across all platforms. This new product supports IBM's core technology by adding an easy-to-use IDE to simplify installation authoring and reduce development time.
-0-
InstallShield for IBM Solution Installation Features:
Visual Dialog Editor -- Easily create new dialogs or modify
existing ones.
Script Editor -- Easily edit and format the custom action code
for your script directly inside the InstallShield design
environment.
Project Assistant -- Jumpstart a project by using a simplified
set of views to quickly guide you through the installation
process. Design and implement your installation in just a few
steps.
Sequence View -- Easily insert actions within a specific
sequence using a dedicated view. Run scripts and dialogs,
launch browsers, and much more.
Actions View -- Manage all aspects of an Installable Unit
using the easy-to-use Actions View with numerous custom action
capabilities.
Availability
The public beta program for InstallShield for IBM Solution Installation is open immediately at www.installshield.com/ibm. The end of the beta phase and commercial availability of the product is expected for Q4 2004.
For more information about IBM's new Solution Installation for Autonomic Computing, visit www.ibm.com/autonomic.
About Macrovision
Macrovision Corporation (Nasdaq:MVSN - News) is the market leader in electronic licensing, installation, and digital rights management ("DRM") technologies. On July 1, 2004, Macrovision acquired the assets of InstallShield Software Corporation. Macrovision's Software Technologies Group markets the FLEXnet universal licensing platform and the InstallShield suite of software installation, repackaging and update solutions, which are deployed on more than 500 million desktops worldwide. Tens of thousands of software publishers and hundreds of Fortune 1000 companies use Macrovision technologies to maximize the value of their software. Macrovision holds more than 700 software licensing, DRM and content protection patents worldwide. Macrovision is headquartered in Santa Clara, California and has offices worldwide. More information about Macrovision and the InstallShield line of products can be found at www.macrovision.com and www.installshield.com.
http://biz.yahoo.com/bw/040716/165131_1.html
U.S. Music Sales Up in First Half
By Ed Christman
NEW YORK (Billboard) - The U.S. music industry finished the first half of 2004 with album sales of 305.7 million units, up 6.9% from the 285.9 million units scanned in the corresponding period last year, according to Nielsen SoundScan.
In market share, Universal Music & Video Distribution was the No. 1 ranked distributor for the first six months of 2003, with a 27.1% stake. While that is up from the 26.6% it had in the first three months of this year, it is down from the 27.7% it had in the first half of last year.
Independent labels collectively ranked No. 2, with a 17.5% share for the six-month period ended June 27. This compares with 16.8% in the same period last year.
Making a big move in market share, BMG Distribution finished at No. 3 with 16.4%, up from the 13.7% it had in the first half of 2003. On the other hand, WEA's market share dropped to 14.6% in the first half, down from the 17.6% it had in first-half 2003. Also down was Sony Music Distribution, to 12.8% from 13.4%.
But EMI Music Marketing enjoyed a market share increase over its 2003 performance, finishing the first half of 2004 with 10.7%, vs. 10%.
Universal also came out as the top distribution company in terms of current-album market share, with 28.6%. It was followed by BMG, with 19.8%; the independent sector, 15.4%; Sony, 12.8%; WEA, 12.7%; and EMM, 10.7%.
Usher's BMG-distributed "Confessions" (LaFace/Zomba) was the top-selling album in the first half, at 4.5 million units. It was followed by Norah Jones (news)' "Feels Like Home" (Capitol/EMI), with 3.1 million.
Reuters/Billboard
http://story.news.yahoo.com/news?tmpl=story&cid=769&e=1&u=/nm/20040707/music_nm/music_ye...
Putting the 'vision' in Macrovision
By Faultline
Published Tuesday 6th July 2004 14:24 GMT
This year's horizons for Macrovision, the highly valued content protection company, include a system to defeat file-sharing, a new, more effective, CD copy protection system and a shot at an interoperable Digital Rights Management system of its own.
The first two of these systems are virtually ready to go and CEO Bill Krepick reckons they will catapult company revenues based on music protection from a few percentage points now, to a major new revenue stream for the company. The third system on DRM, he admits, might not be so straightforward.
The new CD system will be operational in weeks and will allow a set number of CD copies to be burned from a protected CD, but each copy will be content protected. At the moment any system that allows CD copies to be made doesn't also copy the protection system.
The new file sharing system has been in tests for months now and has just gone into Beta with a major music company, ready for general release probably later this year. It works by finding finger-printed copyright works and setting up decoys and creating denial of service requests (or something similar) to slow down delivery of illegally offered files.
The company is also trying to see if it can find a way of making Apple's Fairplay, Microsoft's Windows Media DRM and Sony's MagicGate DRM all interoperate.
All of this came out in an interview with Krepick this week, where we got to ask a question that we often get asked, which is what makes Macrovision worth so much.
Investors have asked us if the stock is too high to invest in further, or if there is any point in shorting it. Players that feel they have to license Macrovision technology ask if there is any alternative. Perhaps the interview provides some answers.
Krepick's comments show that the word Vision is very much alive in the company Macrovision.
Jazzed up
Krepick was mostly jazzed up about the closing of the Install-shield acquisition, which happened on Thursday. This will take the company to just 55 per cent of its revenues in copy protection and 45 per cent coming from enterprise software and its protection.
But we managed to get him to talk about the key building block behind Macrovision's business, which are the copy protection systems on Video DVDs and on music CDs, and in particular the way in which these systems eliminate the infamous "analogue hole."
The analogue hole is created when a DVD player converts a digital file to an analogue file to get it to play on an analogue TV. This is when a DVD file is most vulnerable to copying.
"Our biggest revenue stream is from DVD copy protection right now, we have about 60 per cent to 65 per cent of all DVDs protected using our technology. This figure rises and falls, it doesn't just go up. We don't know why. Studios make their own decisions about copy protection, certain titles get protected, others don't," said Krepick
But the copy protection is really a matter of co-operation rather than technology, because it is supported by the wording in the Digital Millennium Copyright Act.
"We have a couple of patents, where we placed a couple of bits in key places on the disk, When a VCR sees these bits coming out of a player it modifies the video signal. The signal can still be seen okay by a TV set, but it looks strange to a VCR. The companies that make VCRs are required by law to respect it. The devices have to have an automatic gain control circuit to work with this, but no special software or an operating system."
A DVD player senses the same kind of thing, as it converts an analogue signal coming in to it.
The wording of the law places the obligation on the consumer electronic device manufacturer, and the key wording is "If it is a widely available copy protection technology, equipment makers must respect the signal".
Royalty-free play
Krepick recalls: "What we did is went to each of the CE players during 1997 and 98 and said 'We won't charge you any royalties to implement this technology, and we just want you to ensure that there is a circuit that recognizes our copy protection signals. Instead we charge 4 to 5 cents per DVD.' The CE companies said they would support it.
"This is very specific to video signals though and the law doesn't apply in the same way to audio signals.
"For music we have implemented parts of Microsoft's DRM within our system. In audio you can't transform the file from digital to analog, because there are digital players and it would damage the music, so what we do right now is hide the table of contents from any PC the music is written to.
"Using Microsoft's DRM (data session toolkit) you can manage a data version of the music track which can be copied to a PC. The DRM encrypts it and then it needs the key to read the file each time it is played. When the file is shared across the Internet, any illegal recipients can't play the file because the key remains hidden on the original PC."
So how does its competitor SunnComm manage CD copy protection?
"SunnComm uses Red Book audio files and puts an active manager, a piece of software, on your PC. Now we all know that software doesn't load when you put a new CD in if you hold down the PC's shift key, so that's why this disables SunnComm protection. "We are both using Microsoft DRM now to create legitimate multiple CD burns from a protected file. The record company can pick a number of burns allowed and after that the original won't burn any more. But the problem is that these copies are not themselves protected by CD copy protection.
"Macrovision is weeks away from producing a new type of copy protection process whereby all the burned CDs will have the same copy protection as the original."
Burning issue
What about online music services, such as Apple iTunes?
"The Fairplay DRM protection on iTunes also only allows you to burn a particular playlist a set number of times. But you can just reverse track one and two and then it's a new playlist.
"Also these CD burns carry no copy protection. We have to move to a system that makes each new copy just as protected as the original. The studios, once they get used to our new system, which will protect all copies, is likely to insist that Apple implements something similar.
"We have tried to talk to Apple, but they don't want to talk to us right now and we can't make them. Perhaps they will talk to us once they are made to implement this.
"So right now music copy protection is a small business for us, about 3 per cent or 4 per cent of our revenue, with about 270 million CDs out there with it on, all launched in Europe and Asia.
"BMG (Bertelsmann Music Group) have some unique requirements that means that they prefer the SunnComm Technology. We have always felt it was flawed although we could implement in just the same way, but again, we've mentioned the shift key.
"But with our new system we seen a very promising future for CD copy protection."
Interestingly though Krepick let slip that Microsoft doesn't charge anything for the use of its DRM on these CDs. "I figure they just want to get their DRM on as many things as possible," said Krepick and this is another 270 million copies.
On the thorny subject of fully interoperable DRM, Krepick is fairly cynical: "I don't think there will ever be a single universal DRM system. But sure, Macrovision is looking at that challenge. We figure we are seen as neutral, having dealt with the CE firms and with Microsoft and having all the major studios as customers.
"We have some patents here, and over the next year we will see an interference action resolved over just who owns what DRM patents .
"Intertrust brought the action to establish that it had prior claim over various DRM inventions, but it turns out that we filed a number of patents that are now pretty clearly seen as identical, just before them. Does that mean that Microsoft might go back and ask for some of the Intertrust licensing money back, the $440m that it paid earlier this year to put an end to the patent lawsuit with Intertrust?
"No I don't think that Microsoft will have to pay Intertrust back, but if they find that 25 per cent of that intellectual property actually belongs to us, Microsoft might find it has to license our technology too."
"But we have engineers right now trying to see how they can make Fairplay, Microsoft Windows Media DRM and Sony's MagicGate DRM all work together."
Downloaded future
But what if the future turns out to be an online future where DVDs are downloaded over the Internet?
Well, Macrovision has already worked its magic in the pay per view window for major film releases: "About 90 per cent of digital set tops will recognize another, similar signal, that we have set up inside pay per view films. In fact the Sky TV pay per view films shown in the UK are protected with it," says Krepick.
"We are also working with the VoD server guys with the same kind of technology and we are trying to extend this to hard disk based players like DVRs and portable media players. It requires that same walking of the tightrope between the consumer electronics companies and the content owners, and we are working hard to make that happen right now.
"But something we are very excited about is what we are doing in file sharing. We have built a system that is aimed at controlling the use of file sharing for downloading music, video and software.
"It doesn't require that the authors of Kazaa or Grokster supports us or co-operates with us, it doesn't use SpyWare in your PC or the tracking of downloaders back to their ISP or IP address either. We don't even have to have placed out content protection technology into the film the media is on in the first place.
"What we have done is try to make the experience of downloading less appealing. We have set up a series of servers all over the world, and they first establish, using our own fingerprinting technology, which files on offer belong to our clients. Then we track their demand and try to make the download experience as frustrating as possible."
Keeping mum
Krepick clearly didn't want to say too much about this new system pre-launch, but would talk about its effects: "There are often a 100 sources for the file you want and if it turns out that 90 of them are decoys set up by us, then getting hold of that file can be a pretty frustrating experience. And during the process the Macrovision system will direct the downloader to another, legal download copy of the same song, video or piece of software.
"We've had it in trials with a number of independent record labels, now it is moving to a trial at a major record label. We have just released it into beta now.
"We also tried the same set-up with some video files even though the software is optimized for music. It just worked with the video unchanged. Even where people have gone into theaters with camcorders and illegally filmed a motion picture, the fingerprinting has worked and we have been able to slow down the downloads.
"In fact we tried it on one picture launched in the last 30 days [Krepick wouldn't say which one] and we found that there are no copies of that film up on any of the major file sharing networks. Next we plan to apply this system to protecting software packages too."
http://www.theregister.co.uk/2004/07/06/macrovision_vision/
Breakthrough is right........
While you ROTFLMAO you may
want to rethink your position here because it is MVSN that protects from DVD to VHS and SunnComm has a work in progress for DVD to DVD.
You must remember that it is and has always been that MVSN has disregarded SunnComm as any possible competition and now guess what? MVSN is playing catch-up in the CD arena ROTFLMAO at you. Afterall where is there solution?
Or are they possibly beta testing and market analyzing still? Or is it next quarter that they may release a solution? ROTFLMAO
ROTFLMAO!!!! A BREAKTHROUGH??????? ROTFLMAO!!!!! Whats the breakthrough, that they finally got it to work on a DVD??????, Meanwhile MVSN is already protecting over 2.7BILLION and counting DVDs,ROTFLMAO!!!!!!!!!
SunnComm Achieves Breakthrough in DVD Protection
PHOENIX, Jun 28, 2004 (BUSINESS WIRE) --
SunnComm International, Inc. (OTC: SCMI):
-- North America's audio CD copy management leader completes
Phase I of patent applications that integrate breakthrough
technology including features to protect, enhance, and manage
content on commercial DVDs
SunnComm International, Inc. (OTC: SCMI), the #1 provider in North America of copy management and enhancement technology announced today that it has completed its "proof of concept" in the development of its anticipated DVD copy inhibiting technology. According to Eric Vandewater, SunnComm's chief technology officer, "We expect to begin the internal beta testing of our DVD copy management technology as early as next quarter (Q3/04), and we expect to deliver MediaMaxDVD(TM) technology to a leading major motion picture distributor for testing in the 'real' world later this year."
The SunnComm MediaMaxDVD technology will include features and enhancements never before found on a commercial DVD in addition to the security components designed to inhibit casual copying. The company will announce these additional features following the completion of Phase I of its patent application process intended to secure the intellectual property rights related to these unique additional features. These enhancements have been designed to create greater entertainment value for the consumer while boosting incremental sales and contributing to higher price points on catalog DVD releases.
SunnComm's president, Peter H. Jacobs adds, "The SunnComm development team, which now spans two continents, is confident that its MediaMaxDVD technology will not only help to protect commercial DVDs from rampant casual copying, but will empower DVD consumers in ways never before conceived by the movie industry - one of most lucrative segments in the entertainment industry. Utilizing MediaMaxDVD, both movie and television content distributors will have a choice in DVD copy management that not only offers a level of security, but also provides consumer-friendly and unique value-added functions and features.
SunnComm International, Inc. currently provides 100% of all copy managed CDs in North America and is currently providing its proprietary MediaMax CD3 technology on some of today's best selling music CDs including a hit album this month that was ranked #1 on Billboard's Top 200. Another major step for SunnComm involves its recent announcement that the EMI Record Group has begun testing MediaMax on specially selected promotional CDs slated for worldwide release. (http://www.tmcnet.com/usubmit/2004/Jun/1049776.htm). The company has previously announced its forecast to copy manage and enhance an estimated ten million commercial and promo CDs in Q3/04 and twenty-five million commercial and promo releases in Q4/04. SunnComm receives a royalty for each CD that utilizes its technology.
DVD to DVD piracy has become a major concern for content providers in the movie industry. Now, most commercial technology available prevents users from making illegal copies of DVDs when they attempt to convert the DVD content to the VHS tape format. Demand for content protection to fight DVD to DVD piracy is accelerating as DVD players and DVD burners become increasingly available and affordable.
The DVD player market is one of the fastest growing in the world. According to Cahners In-Stat/MDR, worldwide DVD player sales will grow from 29 million units in 2002 to an anticipated 69 million units 2005. This is a clear driver of demand for DVD content. The (MPAA) Motion Picture Assn. of America's annual all-media report, which is circulated only to members reported - DVD sales for U.S. companies jumped by 43% to $14.9 billion in 2003. Internationally, DVD sales tallied $5.5 billion (a 53% bounce over the previous year). The MPAA and its international counterpart, the Motion Picture Association (MPA), estimate that the U.S. motion picture industry loses in excess of $3 billion annually in potential worldwide revenue due to piracy.
While there are no doubt
disgruntled users out there, they are a tiny portion of the nearly 400,000 units sold. I would think all you MVSN folks would be happy about that, as it means more and more consumer acceptance in a market that you also are trying to break into.
JMO.
More actual enduser reviews of MediaMax DRM on the Velvet Revolver album
* This is not an Audio CD., June 18, 2004
Reviewer: johnny50000 (see more about me) from Minneapolis, MN
First off, this is not an "audio CD" as defined by Philips 2 decades ago. Philps denounces these discs, as they do not adhere to the standard "Compact Disc Digital Audio" specification due to their copy protection mechanism. It's too bad Amazon doesn't tell you that anywhere in the description. I would call that false advertising.
That said... CDs don't last forever. Unless I leave it in my car stereo 100% of the time, it's going to get pulled out and put back into its sleeve hundreds of times, and it's going to get scuffed up, and maybe scratched, and eventually it'll be unreadable. Even if I'm as careful as I can be. That's why I don't carry any original CDs in my car - only backups. I leave the original in the house, in its jewel case, where it's safe. But here's a CD that I can't back up. Does that mean I'm supposed to pay for a second copy? I don't think so, since I supposedly bought a "license" for the music on the disc. But does that mean the license is worn out with the disc? Or not? If it's a license I bought, then I should be able to play it on my iPod/Walkman/Computer - not just my dedicated CD player. And if it's a license, I should be able to turn in my old, worn out piece of plastic for a new one, because after all, the plastic isn't what I paid for - the license is. The record companies need to figure out what they're selling before I'm going to buy any more music from them. If I could just give an artist $10 to be able to listen to their songs wherever I wanted, I would do it in a heartbeat. But if this CD is any sign of things to come, then music as I knew it is dead. I will be returning my copy for a full refund, as this is not a music CD as advertised. And I'll just download it from a P2P network somewhere, and now the artists don't get any of my money. Now I've spent all my words talking about corporate greed & monopolistic behaviors. What a shame. I do think it's a descent Rock CD.
Amazon.com review
* The music doesn't matter..., June 18, 2004
Reviewer: A music fan from St. Louis, MO
The music doesn't matter if you can't play the CD. This *PRODUCT* is more than just the music, but the delivery mechanism, too. (As well as cover art and other package contents). The delivery mechanism sucks, and Amazon wasn't even nice enough to warn their customers about it. I'm returning mine -- it's obviously a defective CD (and it was sold as a CD, not a CD-like medium).
Amazon.com review
***** Works on Mac, not PC, June 17, 2004
Reviewer: A music fan from New York, NY United States
My PC doesn't recognize the disc, as others have said. However, it works fine when I put it in my Mac (a PowerBook). Hope this helps.
Amazon.com review
* Will not play on my computer, June 17, 2004
Reviewer: A music fan from Los Angeles, CA
This CD won't play on my PC. So I don't even know if the music is good or not.
Amazon.com review
**** Good Music, but the CD is worthless, June 17, 2004
Reviewer: XY Boy (see more about me) from USA
The 4 stars are for the music. THe CD itself gets a 1-star rating. It seems that RCA must have a bunch of technically incompetent engineers on staff: they made a CD that can't be played in over half of today's normal use-modes.
Also, The LP version of "Contraband" sounds better than the CD does on a good playback system. The LP was mastered by an engineer at one of the old prestige labs that used to do "audiophile" discs. The CD sounds like it was mastered by a trainee.
The CD won't play at all on any computer that runs Windows, or a Windows media player. I'm have not used the CD in (so I am not not sure about) the Apple-OS, or other Operating Systems.
There is no problem playing the CD in a home or car stareo, or on CD-walkman like device. But who wants to do that anymore? Just download a song you like, on MP3 and use it on your MP3 players. It's a lot less expensive too: $0.59--0.99 per song, instead of $14 for a 13-song CD. If the Record companies are going to put out useless CD's, then I think fans should totally boycott the record companies, and just pay the artists for their music.
Amazon.com review
* AGING HASBEENS SELL OUT FANS, TO CORPRATE COPYPROTECTION, June 17, 2004
Reviewer: getlivin from STAND UP FOR YOUR RIGHTS
I buy any other album I can make a copy on my MP3 player. Listen to while at the beach. On cassette & play in my car. That is not stealing. I can't play this on my PC at work.
There is a list of approved portable MP3 Player that are allowed to play this album. I own a Yepp, an Archos niether are approved. IPODS are not approved. Part of the copy protection will not let you rip MP3 it will rip WMA windows media file. Bill gates will descide which MP3 player he will sell enconding to. Right now that does not include Apple. If you want this on IPOD you will have to buy it from ITUNES.
Uniteligent medicated artist have figured out a way to make Bill Gates even more wealthy.
This is out of control. I can't play this on my computer unless I am connected to the Internet. Your not allowed to copy. We are at an important point in the digital age. Buying this or any copy protected CD is sleeping with the enemy.
I bought and paid for my cd why are you applying copy protection on my stuff? I should be able to listen to MY CD anywhere and anyhow I CHOOSE and not have to license (Pay for the same thing three times)or ask Bill Gates which MP3 player to buy. Spend your energy figuring out how to protect your material some other way. It's the knuckleheads on ITUNES & other online delivery systems that you need to worry about. What's next? Give you $5.00 for every DVD player I put my DVD movie into?
All this so Scott Weiland can get his balloon of cheese and Bill Gates begin another monopoly. The CD is average at best. Have you read this clowns lyrics, what's he talking about? One word Scotty, Methadone. GIVE IGGY BACK HIS PANTS Buffoon!
PS you can hold the shift key all you want you aren't going to be able to rip this CD. That simply doesn't work with this encryption. You can not skip tracks copy protection forces you to listen to the whole album.
There is no fast-forwarding rewinding repeating.
AT LEAST WARN US YOU HAVE DEPLOYED THIS COPY PROTECTION SO WE CAN MAKE AN INFORMED CHOICE. LIST APPROVED MP3 PLAYERS ON CD COVER. STATE THAT YOU MUST HAVE AN INTERNET CONNECTION TO PLAY ON PC. I PERSONALLY WOULD NEVER BUY ANY CD THAT USE THIS FORM OF PROTECTION.
FIGHT THE POWER, SKIP THE SONGS YOU DON'T WANT TO HEAR. QUIT MAKING BILL GATES RICHER.
Amazon.com review
* Why should I buy this?, June 11, 2004
Reviewer: A music fan from Los Angeles
What's the point in buying a cd, when downloading it illegally off the internet will provide me with a product that I can actually use in the ways that I want to? Do the record companies think that this silly copy-protection is going to prevent these MP3 from being traded all over the internet? All its doing is punishing the people who actually paid for the CD. This also makes the downloadable version better and more enticing. If anything, silly copy-protection manuevers like this are only going to promote internet theft. This makes me want to download it off the internet (even though I didn't particularly like the music) and make sure that everyone I know also pirates it off me, just to protest this kind of stupidity. Didn't anyone learn from what happened to Metallica's career after Lars' Napster crusade?
Amazon.com review
* Not Compatible with Your iPod, June 10, 2004
Reviewer: Brandon Fuller from Longmont, CO USA
So I just bought the new Velvet Revolver CD. It showed up yesterday. There is a sticker on the package that says:
This CD is protected against unauthorized duplication. It is designed to play on standard playback devices and an appropriately configured computer. If you have questions or concerns visit www.sunncomm.com/support/bmg
Whatever. So I pop the CD in the computer so that I can rip it and put it on my iPod. The CD starts playing some auto play stuff and then an embedded Windows Media Player comes up in a web page and allows you to play the songs. Exit. I went into iTunes and hit Import to rip the tracks. When it finished I went to play the tracks and they were all garbled. What's going on? Guess I ought to read that web page.
So on that Sunncomm site it basically says the CD is protected. It will only allow you to play it on a computer with its technology. You cannot rip tracks from the CD. It specifically states that you cannot move the songs to an iPod because they (in so many words) don't like Apple and Apple isn't working with them so screw Apple. Huh? No, screw you. I like Apple and I just bought your music. But by the way, this album is available at the iTunes Music Store.
After doing some research, it turns out that this company is putting their copy protection on more and more CDs. This one happens to be the first one that I have bought. So now what? How does this work? Turns out that when Windows starts to auto-run the CD, it quickly installs a hidden driver on your machine that is used to garble the sound of CDs protected by this technology. So now my computer is "infected" with this driver. Some grad school student figured this out a while back and let the world know if you just hold down the shift key, Window's auto-run does not run and you have ready access to the CD. They threatened to sue him.
That solution is too late for me, I already have this installed. More research and system scans pointed me to a hidden driver on my machine called SbcpHid. You will find it in your Windows\System32\Drivers directory. So all you have to do is go into the Windows device manager, find it, stop it. Now you can rip. If you want it off your machine, you can uninstall it from there too.
While there was a sticker on the front of the CD, I found this to be very sneaky. I mean installing hidden drivers on your computer. The driver is not marked with any company name or details so you don't know what it is. The timestamp of the driver was manually adjusted so you couldn't tell that this was installed today. This sounds like most of the spyware that we are all trying to rid our computers of.
So where does that leave us? If you buy the music in a store, you can only play on these certain devices? If I would have bought this music at the iTunes music store, I am limited to what Apple wants me to do. So in this case, if I wanted a good old CD case and disc plus the music on my iPod, I would have to buy the same music 2 times according to the record company. That isn't right. Fair use law dictates it. If the industry doesn't get this figured out, we are going to be in trouble. For now, I guess you and I need to be selective about how we buy our music.
Amazon.com review
* cd will not play, June 10, 2004
Reviewer: A music fan from compton, ca
this is the second velvet cd i have bought and it still will not play on certain cd players. I will return it and go with something better like 50 CENT. Borrow a friend's copy but don't waste your money people.
Amazon.com review
* what the heck?, June 9, 2004
Reviewer: bsaxman (see more about me) from Virginia
I'm in a difficult position here... this album is pretty damned great, but the artists aren't the ones preventing me from enjoying this music... RCA/BMG have decided to implement a CD Copy-protection program in this that prevents it from playing in my car cd player, and prevents me from downloading any of the tracks to my computer for archhiving or even transferring to my mp3 player... so again What the heck??? I spend good money on a CD that I can only listen to on one cd-player in my house which isn't even close to my primary listening station. I now have to wait a few weeks for some super-genius out there to crack the protection before I can really enjoy this disc... I understand the need for cracking down on piracy, but don't do it at the expense of the loyal consumer, for pete's sake I've purchased over 1,000 CD's in the last 10-12 years, its EXTREMELY inconvenient for me to have to search my storage for the right disc I want when I normally just play them from my 200GB hard drive on my PC on which I spent a metric (...)-ton of money on the sound system. so yeah, reviewing again, great music, but find a different way to get these tunes, and write your congressman or something, these greedy record execs are hurting the wrong people.
Amazon.com review
* DONT NOT BUY THIS ALBUM, June 15, 2004
Reviewer: A music fan from buffalo ny
i can NOT play this CD in my computer at work. the "digital permissions-whatever-things" wont load up, therefore, i cannot use any media player to listen to my new CD. thanks a lot. IF I PAY $15.99 FOR A CD I EXPECT TO BE ABLE TO LISTEN TO IT WHEREEVER I GO@@AMN WANT TO. IF THE EMBEDDED ANTI PIRACY TECHNOLOGY ISN'T GOING TO WORK SEAMLESSLY THEN DON'T USE IT.
Amazon.com review
Sceamineagle, and sidekick 117ny302bxv howdy, Im sorry but it really is impossible to "falsely" state a question, an answer, yes, but a question?, IMPOSSIBLE, perhaps you misread my email, anyways, yes I asked him 2 questions and he answered them to my satisfaction, I also posted the information for my fellow investors to evaluate, Im sorry that you take exception to me sharing the info here, please place me on ignore so that I wont trouble you in the future with any other DD info I may share with my fellow investors here.
A further explanation:
Posted by: 117ny302bxv howdy
In reply to: kenco who wrote msg# 6533 Date:6/25/2004 6:39:33 PM
Post #of 6539
kenco, you falsely stated in your e-mail to Mr Stone "is it your conclusion that Sunncomms product is on track to become the industry standard"
That was not what Mr Stone concluded, but rather he reported the following points,but left out several other key contracts / agreements.
Mr Stones points:
1.Conclusion: BMG is approaching mainstream adoption of a competitor's CD audio copy protection technology.
2. Competitor's (SunnComm's) CD Solution Gaining Mainstream Adoption In U.S. BMG has now released a total of 12 copy protected CDs using competitor SunnComm's technology.
3. Releases include Velvet Revolver's 'Contraband', the #1 top-selling album in America two weeks ago. This is a significant step forward for the industry and should prompt other labels to follow.
4. Based on our discussions with several major labels, we believe initial sell-through data for copy protected CDs strongly supports the rationale for copy protection expenditures. One noted that new release sales typically drop in week #2 by 50% and copy protected discs have shown drops on average of 30%. Moreover, certain artists are now requesting labels to use copy protection.
And NOW, the 5 or 6 important issues Mr. Stone did not mention.
1. EMI Music Selects SunnComm International's MediaMax Content Management Technology for Pre-Release CDs
Thursday June 17, 1:35 pm ET
2. Sonic Arts Licenses SunnComm's MediaMax M4 Technology for its Pre-Release Audio CDs
Wednesday June 9, 11:00 am ET
3. Independent Music Giant, KOCH Records, Inks an Agreement to Use SunnComm's MediaMax M4 Copy Management Technology
Tuesday June 1, 9:40 am ET
4. DIC Entertainment Selects SunnComm´s MediaMax M4™ Music Management Technology for Strawberry Shortcake Premium Offer
5. Sonopress and SunnComm Technologies Sign Worldwide Licensing and Reseller Agreement for Protecting and Enhancing Audio CDs - Global Replication Giant to Market SunnComm´s MediaMax(TM) Enhancement and Music Management Technologies, Worldwide - ASHEVILLE, N.C. & PHOENIX, Dec 9, 2003 (BUSINESS WIRE)
6. Potential of BMG / Sony merger being finalized, thus possibly having Sony adopt the SunnComm technology as has BMG.
I am glad that Mr Stone quickly pointed out to you "Kayliegh" what he did not state or imply."
A valid response:
Posted by: 117ny302bxv howdy
kenco, you falsely stated in your e-mail to Mr Stone " is it your conclusion that Sunncomms product is on track to become the industry standard"
That was not what Mr Stone concluded, but rather he reported the following points,but left out several other key contracts / agreements.
I am glad that Mr Stone quickly pointed out to you what he did not state or imply.
From: Rob_STONE/us/socgen@us.socgen.com
Date: 25 Jun 11:18 (PDT)
To: "Kayliegh Enco" <kenco@ragingbull.com>
Subject: Re: your PR on MVSN today
You do have the complete text, which does not state or imply that SunnComm
will be the industry standard. So far, they are widely deployed by just one
label, BMG.
And, the current dual session format, which does not support iPod, is not
the solution the labels ultimately want.
--------------------------
Robert W. Stone
Managing Director
Institutional Research
SG Cowen Securities Corporation
Two International Place
Boston, MA 02110
tel: 617-946-3932 fax: 617-946-3760
e-mail: Rob.Stone@sgcowen.com
----- Original Message -----
From:<kenco@ragingbull.com>
To:robert.stone@sgcowen.com
Cc:jean.calleja@sgcib.com
Date: 06/25/2004 12:29:00 PM
Subject: RE: your PR on MVSN today
Dear Mr. Stone,
This PR below is currently being circulated on a couple
of stock chat boards as an endorsement that Sunncomm is
on track to become the industry standard in this field,
I just wanted to ask if this is your actual and
complete PR? also, is it your conclusion that Sunncomms
product is on track to become the industry standard as
the people circulating this article suggest? I have
also included links to the actual posts that I found
your PR on.
Thanks in advance,
Kay
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++
[ID:2042021]
June 25, 2004
Macrovision (MVSN)
U.S. CD Copy Protection Gaining Momentum, But Further
Development Required
Conclusion: BMG is approaching mainstream adoption of a
competitor's CD audio copy protection technology. While
this is positive for the entire industry, our checks
suggest MVSN's CDS-300 product needs further
development. We remain cautious regarding MVSN's
success in this segment. However, with adoption still
early and CD audio less than 5% of our 04/05E sales, we
maintain our bullish view on the stock.
Competitor's CD Solution Gaining Mainstream Adoption In
U.S. BMG has now released a total of 12 copy protected
CDs using competitor SunnComm's technology. Releases
include Velvet Revolver's 'Contraband', the #1
top-selling album in America two weeks ago. This is a
significant step forward for the industry and should
prompt other labels to follow.
Our Checks Suggest Growing Momentum For CD Copy
Protection. Based on our discussions with several major
labels, we believe initial sell-through data for copy
protected CDs strongly supports the rationale for copy
protection expenditures. One noted that new release
sales typically drop in week #2 by 50% and copy
protected discs have shown drops on average of 30%.
Moreover, certain artists are now requesting labels to
use copy protection.
MVSN CDS-300 Unlikely To Be Adopted In Its Current
Form. A key requirement for many labels is support for
multiple file formats, especially Apple iPod. MVSN
CDS-300, in its current form, is designed to support
only MSFT music files. Further development will be
required to support multiple file formats. Given CD
space limitations, the files must be made 'on-the-fly'
from the red-book audio session. Our checks suggest no
competitor has this capability yet. So we believe MVSN
is still in the running for new wins. But, SunnComm and
First4Internet are likely strong contenders.
Robert W. Stone
(617) 946-3932
robert.stone@sgcowen.com
http://www.investorshub.com/boards/read_msg.asp?message_id=3423496
http://www.investorshub.com/boards/read_msg.asp?message_id=3423622
http://ragingbull.lycos.com/mboard/boards.cgi?board=SCMI&read=5054
Sales of copy-protected CD may signal fan acceptance
By ALEX VEIGA, AP Business Writer
Last Updated 3:40 pm PDT Wednesday, June 23, 2004
Get weekday updates of Sacramento Bee headlines and breaking news. Sign up here.
LOS ANGELES (AP) - A music CD wrapped in copy-protection technology has become a best seller, fueling speculation that U.S. music fans might be ready to accept such restrictions on a wider scale.
Velvet Revolver's "Contraband" has sold 380,000 copies since its release last week, when it grabbed the top sales spot with 256,000 units sold, according to Nielsen SoundScan.
It's one of a few CDs issued in the United States equipped with such copy-protection measures, which the recording industry has been cautious to implement.
"Obviously, this is our highest-profile release to date with copy-management technology, so there's a sense that the technology has matured and our research shows us that consumers are receptive," said Nathaniel Brown, a spokesman for Bertelsmann Music Group.
Fans bought the CD despite clear warnings on the case about the copy restrictions, suggesting many anticipated the release of "Contraband," the first record by the group formed by ex-members of Guns N' Roses and the frontman of Stone Temple Pilots.
The technology on the CD is supposed to help reduce music piracy by preventing buyers from burning more than three copies, among other restrictions.
But it remains a work in progress - songs ripped from the CD don't play on Apple Computer Inc.'s popular iPod digital music player. And users loading the CD on a PC running Microsoft Corp.'s Windows operating system can easily bypass the protection features by pressing the "shift" key.
Phoenix-based SunnComm Technologies Inc., the company behind the copy protection features on "Contraband," says its technology is not supposed to be hacker-proof, just effective enough to reduce overall piracy.
Record companies "wouldn't pay a penny for this technology if it didn't work," CEO Peter Jacobs said, adding that the shift key issue is not a flaw in SunnComm's technology but a feature in the Windows program.
"It's not a bug," he said.
Jacobs said SunnComm is waiting for Apple to assist in adapting the next generation of SunnComm CD protection so song files can be ripped from its CDs and played on the iPod. Currently, SunnComm's technology converts files into the Windows Media Player format.
Thanks to stingray2
Look at this :
[ID:2042021]
June 25, 2004
Macrovision (MVSN)
U.S. CD Copy Protection Gaining Momentum, But Further Development Required
Conclusion: BMG is approaching mainstream adoption of a competitor's CD audio copy protection technology. While this is positive for the entire industry, our checks suggest MVSN's CDS-300 product needs further development. We remain cautious regarding MVSN's success in this segment. However, with adoption still early and CD audio less than 5% of our 04/05E sales, we maintain our bullish view on the stock.
Competitor's CD Solution Gaining Mainstream Adoption In U.S. BMG has now released a total of 12 copy protected CDs using competitor SunnComm's technology. Releases include Velvet Revolver's 'Contraband', the #1 top-selling album in America two weeks ago. This is a significant step forward for the industry and should prompt other labels to follow.
Our Checks Suggest Growing Momentum For CD Copy Protection. Based on our discussions with several major labels, we believe initial sell-through data for copy protected CDs strongly supports the rationale for copy protection expenditures. One noted that new release sales typically drop in week #2 by 50% and copy protected discs have shown drops on average of 30%. Moreover, certain artists are now requesting labels to use copy protection.
MVSN CDS-300 Unlikely To Be Adopted In Its Current Form. A key requirement for many labels is support for multiple file formats, especially Apple iPod. MVSN CDS-300, in its current form, is designed to support only MSFT music files. Further development will be required to support multiple file formats. Given CD space limitations, the files must be made 'on-the-fly' from the red-book audio session. Our checks suggest no competitor has this capability yet. So we believe MVSN is still in the running for new wins. But, SunnComm and First4Internet are likely strong contenders.
Robert W. Stone
(617) 946-3932
robert.stone@sgcowen.com
Ken, with all due respect,
evidently neither do you. In fact those numbers were public at one time and no doubt with a little effort could still be found. The point is the numbers are falsely inflated to make MVSN look like they are accomplishing something they have not, to date, been able to. On the other hand, Sunncomm's tech is being used on the two majors (and I'm hearing another is on board soon), and the largest independent.
Some reviews of Sunncomm DRM by actual end users...
(There are many many many of these reviews by unhappy end users on Amazon as well as other sites, as I find time I will try and assemble them and post them for investors DD)
*** good album, bad record company, June 24, 2004
Reviewer: A music fan from New York, NY United States
To any iPod users - be aware that you CANNOT PLAY THIS RECORD ON YOUR IPOD!! BMG has put some software on the record that enables you to only save the tracks to your computer as 128kbps wma files - lame-ish sound quality and not supported by iPod. They also install a small app on your computer before you can even listen to the disc. Betting that I like BMG artists more than I like my iPod is a loser's bet. I will be returning this cd. Too bad, as I'm sure I would have liked it, but my iPod has to take precedence.
Amazon.com Review
*** had no problem ripping into itunes, June 21, 2004
Reviewer: A music fan from US
3 stars for music - 0 stars for the ridiculous attempt at copy protection technology.
the bottom line is i ripped this no problem into itunes. didn't even have to hold down the shift bar. i just read an article and the label said that consumers are clearly embracing this great new technology - what a crock. i hope nobody mistakes the popularity of this cd with thinking we have no problems with buying more crippled cds.
VR's music is solid and grows on you although the production is very thick and muddy. i like the slower "fall to pieces" and "you got no right" best -probably because they sound the cleanest.
Amazon.com review
**** Great Music, Horrible Technology, June 21, 2004
Reviewer: A music fan from Anywhere
I pressed shift and the auto run program doesnt start up.
It still wont import in itunes. It just stays on the first track forever.
Please boycott copy control cds. If this is the future then stop buying. Buy small and independent releases. Support artists not corporations!
I like Velvet Revolver but I refuse to buy cds with this crap.
If I was going to steal the music I would. Even with the control the cd is avail on P2P. So basically the people who are actually buying music are getting screwed.....
bummed out...
Amazon.com review
**** Great album, but with a big BUT, June 20, 2004
Reviewer: bootsybus (see more about me) from SF, CA
First, GNR and STP are two of my all time favorite groups. I was super psyched when this came out, and you will not be disappointed. Not surprisingly, it sounds VERY MUCH like a traditional STP album. Maybe a bit edgier, but not much of a stretch from the STP everyone loves.
I came back to amazon to see how the reviews were going, and was surprised at all the negative reviews b/c of the copyright protection. My immediate reaction was - well, those that complain are those that steal...so who cares.
But then I ran into my own problems. See, you can't listen to this on your computer except through the player on the CD, if you try to use media player or itunes or musicmatch, the music is totally choppy.
I don't mind using the included player, except it is totally featureless. You can play a single song, or the entire album straight through. Try starting with song 5 and having it run through, no way. Shuffle? You're kidding yourself. You can't do anything. And of course the player is embedded in internet explorer, which is annoying of itself.
My hope is that somewhere, someone is listening, and realizes that this copyright is generally FINE but it needs to be better executed. (in addition to the fact that it appears all the songs are download'able off your favorite P2P software...so for all the effort they have failed miserably).
Amazon.com review
* Has copy protection, June 20, 2004
Reviewer: A music fan from Hollywood, CA
The copy protection on this cd prevented me from playing it in the cd players in my car and computer...currently the only two places I can play cds. I've heard a few songs from this on the radio and elsewhere. What I heard was decent, but between the copy protection and the fact that I found the several songs I did hear only mildly interesting I wouldn't buy this if I could do it over again.
amazon.com review
**** 4 for the music. 1 for the packaging/enhanced CD, June 20, 2004
Reviewer: Randall Reilly from Madison, WI United States
I enjoyed the CD for the music. VR's music has three pieces - updated GNR, updated STP, and a combined GNR/STP which actually turns out to be very good. It's nice to see someone still making real music in this day and age.
As for the enhanced CD - next time a record company packages an enhanced CD please put a big sticker on the cover (like the Explicit Lyrics sticker) rather than hiding it on the back cover in fine print that very few people read. I have no sympathy for the those that bought the CD and tried to rip so they can give away for free, but I do have problems when someone buys and tries to record it for their car, jukebox, a backup copy (like I did). I know that a CD-recorder works just fine recording audio CDRs for a backup and there are ways to break the enhanced CD if you try hard enough.
Finally - record execs here's an idea - instead of selling this CD for a list price of $18.99 so you can sell 5 million copies (and have 5 million downloaded off the internet). How about selling it for a list price $13.99 - maybe you'd get the disc to sell 10 million copies (and only have 2 million downloaded off the internet).
Amazon.com review
* Wake up!, June 18, 2004
Reviewer: A music fan from New York, NY United States
Watch out music buyers!
1. I bought the album from iTunes.
2. I struggled to move the files to my iPod.
3. I realized I could not, due to copy protection.
4. Now I regret buying the album because I can't listen to it unless I'm at home.
Shame on RCA! Why would you choose to frustrate your digital music customer base who legitimately purchases your product!
Wake up RCA... it's the 21st Century! You are alienating your customers.
Shame on iTunes for not notifying your customers of this issue BEFORE they purchase!
Watch out music buyers!
PS - Dear RCA, I'm sorry to see you are still in your old backward mode of thinking. You are leaving the innovation to others (like Shawn Fanning, creator of Napster) instead of being the innovators.
Amazon.com review
* Frustration over copyright software, June 18, 2004
Reviewer: A music fan from United States
I agree with the other reviewers here in regards to the copy restriction software placed on this disc. As an iPod user, I can't add this CD to my player, and what is more bizarre is that they're selling this album on iTunes. Then why in the world did they add this copy prevention software to the original CD?
I understand the record companies wanting to stop free internet distribution of their music, but this is a little rediculous.
The 1 star is for the frustration with the copy protection software, the music is actually really good. It's one of my favorite CDs out right now, along with mr.deviant's "Techno Obsession" which is a great mix of power rock and hard dance music for killer instrumentals. Thankfully, mr.deviant's CD does NOT contain any copy prevention software.
Amazon.com review
* Download it with KLite or WinMX!!!!!!!, June 18, 2004
Reviewer: A music fan from U.S,
Copy protected???????
Yeah right!!!!!!!!!!!
It's very available with WinMX and Kazaa Lite, and probably with eMule, Newsgroups, Ares, IRC, G2, etc....
A search on WinMX yielded 1000 results pretty quickly.
Long live P2P and the digital revolution!!!!!!
Do not buy any major label CD's, it helps the RIAA.
P2P forever.
Amazon.com review
* iPod users BEWARE, June 18, 2004
Reviewer: strike_a_chord (see more about me) from Michigan, United States
The one star I have given this CD has nothing to do with the music inside. It has to do with the copy protection. One who spends almost $13 on this CD should have the right to copy the songs to their $300 iPod, right? Not the case here.
When you pop this disc into your computer, you are forced to agree with the terms. If you click Disagree or close out the window, the CD will immediately pop out of the drive. Once you isntall the software, a driver is installed in your computer that does not allow you to play or copy the songs in any program besides Windows Media Player through the CD software. You can copy the songs to your hard drive using potected 128 Bitrate WMA files... but that does no good for an iPod user, since iTunes will not even bother with WMA files. The WMA files are undoubtably the worst quality files I have ever heard for being 128 Bitrate. They sound just slightly better than AM radio, no exaggeration. You can burn as many copies of the CD as you want using the WMA files, but when they sound that awful, who would want to?
I have spent hours surfing the web and using every method possible to get around this copy protection... and none have worked. Even going into Device Manager and shutting off the driver the CD installed did nothing. The CD will still not copy. I even tried playing the CD in my computer and catching the audio and turning that into an mp3/ACC file... the copy protection even made that impossible.
I am extremely offended that I cannot copy this CD for my own use on my iPod. Since I have read that the entire Velvet Revolver CD is available for download on P2P software, all this copy protection does is keep the honest people from taking full advantage of technology and portable music players. In the year 2004 when I can carry around thousands of songs in my hand by a portable music player, does BMG actually think I'm gonna carry this lone CD around with me too in case I want to listen to it? To add more insult, the entire Velvet Revolver CD is available on iTunes music store for download!
Stay away from this CD. These problems have inspired me to instead support smaller and indie labels more than before. By the way, is it just coincidence that this copy protected CD costs a few dollars more than a typical new release does for the first few weeks? I think not.
Amazon.com review
* Pretty good album, but not worth giving up your rights., June 18, 2004
Reviewer: A music fan from Kansas City, MO USA
I am a huge fan of Stone Temple Pilots (I own all of their records and have been to several shows). I was really looking forward to this CD until I found out that it has copy restrictions. Purchasing a CD with copy restrictions (even easily defeatable restrictions) tells record labels that consumers will accept this erosion of their rights, and allows them to more easily introduce further restrictions in the future. If I can't backup the music that I purchased and convert it to whatever format that I wish, I'm not interested. It really makes me sick that Velvet Revolver would support this. Vote with your dollar.
Amazon.com review
Macrovision Acquires InstallShield
June 24, 2004
By DRM Watch Staff
Macrovision announced last Wednesday its intention to acquire privately-held InstallShield Software Corp. for an initial cash payment of US $76 Million. InstallShield, as anyone who has installed third-party software on a PC knows, is the leading vendor of software installation utilities; it claims a customer base of 69,000 commercial software developers and an installed base of over half a billion desktops.
A good part of the strategic intent of this acquisition is to integrate the product activation and DRM capabilities of Macrovision's FLEXnet software license management platform (formerly called SafeCast, and used by such software vendors as Adobe, Intuit, and AutoDesk) with InstallShield's installer utility. This means that software developers will eventually be able to use the same utility to set user rights to software, and to implement business models such as try-before-you-buy, as they currently do to package software for release.
This integrated solution is highly analogous, for example, to e-book packaging solutions such as Adobe Content Server, which combine rights-setting functions with the publishing industry equivalent of what software developers call "release engineering." Thus this move by Macrovision seems like a no-brainer, and it has the potential to change the "DRM for software" paradigm from being somewhat peripheral to the software development process to being integral to it -- thereby making the commercial software industry a candidate for the next big vertical market for DRM.
Macrovision is viewing this acquisition in the context of its concept of "software value management," which essentially means control over the entire process of developing, releasing, protecting, distributing, and managing licenses to software. Macrovision's particular focus with its FLEXnet platform is on the market for software that gets distributed to large number of desktops at major corporations. The combined offering should make life easier for software license administrators at those companies as well as for software developers.
Contrast this with the vision of software DRM expressed in Digital River's recent DigitalPassport announcement, which focuses on embedding DRM functions into the distribution and business model aspects of software e-commerce. It's a common ploy in technology marketing to declare a new category and claim that you're the leader in it; the trick is to get the rest of the industry to buy into the validity of your buzzphrase. Although the industry hasn't yet settled on any particular end-to-end model for electronic software distribution, we now see it as more certain that DRM technology will be part of it.
http://www.drmwatch.com/drmtech/article.php/3373011
screamineagle, with all due respect, you have absolutely no idea what the numbers are, you numbers are at best a guess and merely your outside opinion, I will trust the MVSN filings for the accurate information.
Actually, that's not accurate. Not even close.
As you know, MVSN bought a couple of company's which had put out early trial versions of protection (which all had very serious flaws) and then used their numbers to claim the 275M
figure. Virtually all of those have been released overseas because their tech doesn't meet the high standards here in the US. Granted they bought the company's and therefore can in a sense claim their numbers but is quite misleading and simply a pr ploy. I'm surprised you would support such a deceptive practice.
Face it, MVSN has fallen way behind the curve. If not for their success with DVD and software protection they'd be finished, IMO.
How patient?
April 2, 2003
"Macrovision said Wednesday that it hoped to begin seeing sales in the Unites States by late this year, but that it had learned to be patient in its home market.
"There's only so much we can do to show the record labels what's going on in the rest of the world," Krepick said. "At some point they have to take a bit of risk and step out and do something."
15 months later and what?
How correct he was.....
"The total market for CD copy protection may eventually be valued at more than $100 million a year, Mr. Krepick said. That could mean a lot for a company that posted revenue of $102.3 million for 2002. Macrovision, however, faces competition from smaller companies such as Phoenix-based SunnComm Technologies, which some say has an edge.
"Playability is our No. 1 concern," said Nathaniel Brown, a spokesman for BMG, a record-label owned by Bertelsmann AG. "At the moment, SunnComm is ahead of the curve in terms of playability."
"The concern with Macrovision is that we believe SunnComm will be the first to go to market with a major music label, giving them a step up in the competitive front," J.P. Morgan analyst Sterling Auty said."
You don't have US statistics because they don't have any.
LOL!
Sales of copy-protected CD may signal fan acceptance
By Alex Veiga
AP Business Writer
Wednesday, June 23, 2004
Click here to access article online
LOS ANGELES (AP) - A music CD wrapped in copy-protection technology has become a best seller, fueling speculation that U.S. music fans might be ready to accept such restrictions on a wider scale.
Velvet Revolver's "Contraband" has sold 380,000 copies since its release last week, when it grabbed the top sales spot with 256,000 units sold, according to Nielsen SoundScan.
It's one of a few CDs issued in the United States equipped with such copy-protection measures, which the recording industry has been cautious to implement.
"Obviously, this is our highest-profile release to date with copy-management technology, so there's a sense that the technology has matured and our research shows us that consumers are receptive," said Nathaniel Brown, a spokesman for Bertelsmann Music Group.
Fans bought the CD despite clear warnings on the case about the copy restrictions, suggesting many anticipated the release of "Contraband," the first record by the group formed by ex-members of Guns N' Roses and the frontman of Stone Temple Pilots.
The technology on the CD is supposed to help reduce music piracy by preventing buyers from burning more than three copies, among other restrictions.
But it remains a work in progress - songs ripped from the CD don't play on Apple Computer Inc.'s popular iPod digital music player. And users loading the CD on a PC running Microsoft Corp.'s Windows operating system can easily bypass the protection features by pressing the "shift" key.
Phoenix-based SunnComm Technologies Inc., the company behind the copy protection features on "Contraband," says its technology is not supposed to be hacker-proof, just effective enough to reduce overall piracy.
Record companies "wouldn't pay a penny for this technology if it didn't work," CEO Peter Jacobs said, adding that the shift key issue is not a flaw in SunnComm's technology but a feature in the Windows program.
"It's not a bug," he said.
Jacobs said SunnComm is waiting for Apple to assist in adapting the next generation of SunnComm CD protection so song files can be ripped from its CDs and played on the iPod. Currently, SunnComm's technology converts files into the Windows Media Player format.
ABOUT SUNNCOMM:
SunnComm International’s (OTC:SCMI) copy-management technology was commercially released by Music City records in 2001 and became the first copy managed commercial CD in America. Following that landmark even, it has become a leader in digital content enhancement and security technology for optical media with its MediaMax M4 suite of products and became the first company to commercially release a content-protected audio CD utilizing an early version of the Windows Media Data Session Toolkit..
SunnComm’s MediaMax M4 Suite of Digital Content Enhancement technologies are built using Microsoft (NASDAQ:MSFT) Windows Media 9 Series but operate on both Apple (NASDAQ:AAPL) and Windows-based systems. For more detailed information about the company, its vision or philosophy, personnel, partners, and customers, please visit the company’s Web site at http://www.sunncomm.com, or call the Company directly at (602) 267-7500, and ask for shareholder relations.
For additional information or investor relations please contact:
Company contact:
Kimberly Faulkner
602.267.7500
kimf@sunncomm.com Investor contact:
Investor Comm. Consulting
602-231-0681
scmi@investorcc.com
MediaMax Digital Content Cloaking Technology, DC2, PromoPlay, TuneShare, MusicMail, Secure-Burn and SunnComm are registered and/or trademarks of SunnComm International, Inc., in the United States and/or other countries. The names of actual companies and products mentioned herein may be the trademarks of their respective owners.
*** good album, bad record company, June 24, 2004
Reviewer: A music fan from New York, NY United States
To any iPod users - be aware that you CANNOT PLAY THIS RECORD ON YOUR IPOD!! BMG has put some software on the record that enables you to only save the tracks to your computer as 128kbps wma files - lame-ish sound quality and not supported by iPod. They also install a small app on your computer before you can even listen to the disc. Betting that I like BMG artists more than I like my iPod is a loser's bet. I will be returning this cd. Too bad, as I'm sure I would have liked it, but my iPod has to take precedence.
Amazon.com Review
From 1st all the way to 3rd in a week?
How many CD's with MVSN's technology on them do they have in the top 10 or top 100 for that matter? ROTFLMAO
screamineagle, MVSN tech is currently on over 275 million music CDs world wide, I dont have the statistics for just the US market, has SCMI cracked 3 million world wide yet? ROTFLMAO!!!!!!!!!!
My mistake.
They have the #3 album in the nation. (You sure are hasty with your accusations of lying. Is that any way for a board monitor to conduct himself?)
Say again, how many publicly released albums in the US is the MVSN tech on?
screamineagle, please stop lying! Velvet Revolver sales have already dropped off enough to knock it down 2 rungs to 3rd place...
http://www.billboard.com/bb/charts/bb200.jsp
To my knowledge
MVSN's technology is not used on any publicly released CD's in the US. Kenco seems to possibly be a MVSN insider, perhaps he can tell us something about it?
screamineagle
How many CD's does MVSN use their fantom CDS100-200-300 technology on in the US?
I haven't heard much about it other than Bill Krepick stating numerous times over the years that they are beta testing their technology and quarter after quarter passes by and zero rollout or licensing agreements with the majors or independents for that matter.
What's up?
Wednesday, June 02, 2004
Recording Industry Hopes To Hinder CD Burning
Hmmm, I’m not sure if this would be a good thing or a bad thing. However, from past RIAA history, it’s probably not a good thing…
On SlashDot:
Decaffeinated Jedi writes "News.com reports that the recording industry is currently testing technology that would limit the number of times that a given CD (or copies of that CD) could be burned. The idea is to let consumers ‘make a limited number of copies of their music—enough for a car, a vacation home and a friend, for example—without allowing for uncontrolled duplication.’ Currently, Macrovision and SunnComm International are developing competing versions of such ‘secure burning’ technology, with BMG Music Group already testing the latter company’s software."
Looks like MVSN's
competition has become the undisputed world leader in this category. Sunncomm's tech is on the former #1 and this week #2
albun in America.
TODAYS L.A. Times:http://www.latimes.com/business/la-fi-rup24.8jun24,1,4226353.story?coll=la-headlines-business
IN BRIEF / MEDIA
CD With Anti-Copying Protection Is a Hit
From Associated Press
June 24, 2004
A music CD wrapped in copy-protection technology has become a bestseller, fueling speculation that U.S. music fans might be ready to accept such restrictions on a wider scale.
Velvet Revolver's "Contraband" has sold 380,000 copies since its release last week, when it grabbed the top sales spot with 256,000 units sold, according to Nielsen SoundScan.
It's one of a few CDs issued in the U.S. equipped with such copy-protection measures, which the recording industry has been cautious in implementing.
June 17th article
By John Borland
Staff Writer, CNET News.com
For the first time, the No. 1 album in the United States is loaded with anticopying protections, marking a clear step into the mainstream for the controversial technology.
According to figures released by Nielsen SoundScan, Velvet Revolver's "Contraband" was the top-selling album in America last week, despite being prominently labeled on its cover as being "protected against unauthorized duplication."
The success of the album is likely to prompt more experiments from BMG, the band's label, and other record companies, industry watchers said.
"It's too soon to tell whether the rest of the industry is going to be heartened by this," said Mike McGuire, an analyst at GartnerG2. "But clearly, there are going to be a lot of people who are very encouraged by the fact it is out on the marketplace."
The step forward is part of a slow increase in the flow of copy-protected compact discs into the American market, after several years of stalled progress. If the pace increases without substantial consumer backlash, the technology could become as commonplace as the antipiracy technology on DVDs, ultimately changing the way that consumers use their purchased music.
For several years, the big record labels have experimented with various versions of the technology, worried by the explosive popularity of CD burners and online file trading.
However, they have been wary of releasing the technology in the U.S. market on a wide scale. Early versions of copy-protected CDs had problems playing in some CD players and computers, prompting customer complaints and even recalls.
A vocal segment of the online population has been intensely critical of the copy protection plans, leading record label executives to worry about potential consumer reaction. Some artists, such as Virgin Records singer Ben Harper, have been bitterly angry at their labels' decision to include the technology without their approval.
The test with Velvet Revolver, a group made of alumni from Stone Temple Pilots, Guns N' Roses and others, was the largest yet for BMG. The test uses MediaMax copy protection from BMG partner SunnComm International. The label says it does plan a growing number of protected releases over the course of this year, but is still choosing which CDs will include the technology on a case-by-case basis.
"We're thrilled with the results we've seen and the apparent consumer acceptance," said Jordan Katz, an executive vice president in BMG's distribution arm. The company has released a total of 12 "copy managed" discs, with more than 2.5 million units now in the market, he said.
iPods still a problem
Like other recent copy-protected albums, the Velvet Revolver disc includes technology that blocks direct copying or ripping of the CD tracks to MP3 format. It also comes preloaded with songs in Microsoft's Windows Media Audio (WMA) format, which can be transferred to a computer or to many portable digital music players.
As in earlier tests by BMG and SunnComm, the copy protection on the Velvet Revolver disc can be simply disabled by pushing the "Shift" key on a computer while the CD is loading, which blocks the SunnComm software from being installed. The companies say they have long been aware of the work-around but that they were not trying to create an unhackable protection.
According to SunnComm, few purchasers have complained about the anticopying tools, although angry postings on sites such as Amazon.com are common. The sticker on the front of the Velvet Revolver CD and a link inside the software that loads automatically on a computer, once a user has given permission, points to SunnComm's Web site.
"We hear from less than half of one percent of people who have the Velvet Revolver disc," SunnComm CEO Peter Jacobs said. "Most of those questions are related to getting the songs onto an iPod."
However, the inability to move songs to Apple's popular digital music player, as well as to other devices that don't support Microsoft's Windows Media digital rights management services, is a serious shortcoming. Jacobs says SunnComm recognizes that--and that the company's next version will go beyond the Microsoft files and be able to create multiple kinds of digital files that will be compatible with the iPod.
But for now, iPod-owning Velvet Revolver fans don't have a direct alternative.
"We are actively working with Apple to provide a long-term solution to this issue," a posting on SunnComm's Web site reads. "We encourage you to provide feedback to Apple, requesting they implement a solution that will enable the iPod to support other secure music formats."
Also on Thursday, SunnComm announced that EMI Music would begin using its technology on advance and promotional releases. That marks the second major label, following BMG, to adopt SunnComm's tools officially, although others are also testing them.
EMI Music has "been encouraged by the success that SunnComm's MediaMax product has enjoyed," Richard Cottrell, global head of antipiracy for the record label, said in a statement. "We are pleased that SunnComm is developing a product that improves our ability to protect our artists' works, especially during the prerelease phase."
Undisputed? LOLOL!
SunnComm is the undisputed leader in DRM and copy protection.
Aren't they the only one to be used comercially in the US to protect and enhance CD's?
EMI Music Selects SunnComm International's MediaMax Content Management Technology for Pre-Release CDs
PHOENIX
SunnComm International Inc., Phoenix
Peter H. Jacobs, 602-267-7500
peter@sunncomm.com
or
Investor Communications Consulting (Investors)
602-231-0681
SCMIinvestor@investorcc.com
or
QuietTiger Inc.
William H. Whitmore, Jr., 602-267-3800
bill@quiettiger.com
Kimberly Faulkner, 602-267-3800 (Investors)
Kimberly@quiettiger.com
SunnComm International Inc. (OTC:SCMI) today announced that its exclusive marketing arm, QuietTiger Inc. (OTCBB:QTIG), has signed an agreement with EMI Music, in which EMI will test the SunnComm MediaMax M4(TM) content management technology for select promotional products on a worldwide basis.
Under the agreement, EMI, the world's leading independent music company, will work with SunnComm to include the MediaMax technology on a limited number of promotional CDs during the pre-release period later this summer.
EMI distributes albums through record labels including Angel, Blue Note, Capitol, Capitol Nashville, Virgin, Parlophone, EMI Classics, EMI Latin, and EMI Christian Music Group in 50 countries. EMI's roster of artists includes The Beastie Boys, The Beatles, Coldplay, Janet Jackson, Norah Jones, Lenny Kravitz, Kylie Minogue, Radiohead, The Rolling Stones and Robbie Williams.
"We've been working collaboratively with the SunnComm team and have found them to be very responsive to our needs and have been encouraged by the success that SunnComm's MediaMax product has enjoyed," said Richard Cottrell, global head of anti-piracy for EMI Music. "We are pleased that SunnComm is developing a product that improves our ability to protect our artists' works, especially during the pre-release phase."
"EMI has been a leader in combating piracy in all forms around the world. Both EMI and SunnComm are committed to further developing the MediaMax suite of content and copy management products in order to strengthen EMI's ability to protect what its artists create," commented Bill Whitmore, QuietTiger's president. "We are excited to take this all-important next step in furthering our relationship with one of the world's most established record companies."
Macrovision supplies CDS™ technology to major UK replicator
LONDON June 7, 2004-Macrovision Corporation (Nasdaq: MVSN), the leading provider of digital rights management and copy protection technologies, today announced that it has reached an agreement with DOCdata, UK’s largest independent replicator, enabling the company to offer Macrovision’s CDS™ suite of copy protection technology for music CDs to its customers.
DOCdata specialises in providing replication services to the music, film and entertainment industries. Its client base also includes an increasing proportion of business and education organisations. In taking on board the reselling of Macrovision’s audio copy protection, it is responding to customer demand. Managing Director Steve Toms observed, “Copy protection has become a huge issue in the last two years as the UK industry wakes up to its importance. It’s quite simple, if we don’t find ways of protecting the product, illegal copying will put a lot of businesses and a lot of individuals out of work.”
The CDS system chosen by DOCdata provides maximum effectiveness in inhibiting disc burning while maintaining optimum playability. The latest CDS-300 offers increased functionality and robust user experience with more flexible usage rights – such as PC playback via Windows Media® Player, ability to seamlessly create playlists or exporting to portable devices, and providing one-click access to bonus content on the disc or premium content via web links.
“Macrovision is such a clear market leader that there was no decision to make” is how Steve Toms describes the choice of supplier. “Being able to provide copy protection and replication as a ‘one-stop’ service gives us a clear advantage in a competitive industry, and the Macrovision name is a great reassurance of quality for our customers.”
“Macrovision is delighted to welcome DOCdata to the growing number of companies who are striving to protect the rights of content owners. The illegal duplication of digital entertainment products is theft and needs to be countered by a concerted strategy between rights owners, replicators and the legal infrastructure,” said Martin Brooker, Director of Sales for Macrovision EMEA.
About DOCdata
DOCdata is the largest independent replicator in the UK, with manufacturing sites in France, Germany and The Netherlands. In operation for over 30 years, the company specialises in servicing the music, entertainment and information industries. The scale of its operation is impressive, with a group output of 200+ million CDs and DVDs processed annually together with 30 million music cassettes and 12 million floppy disks. The company has extended its services in recent years and now operates an ecommerce distribution center in Holland on behalf of its customers to supply consumers with product ordered on the Internet.
More information on the company can be found on the Web Site at www.DOCdata.co.uk.
About Macrovision
Macrovision develops and markets digital rights management, copy protection, and electronic license management technologies for the video, music and software markets. Macrovision’s proven technology has been used on over 2.7 billion video DVDs, 250 million PC games CDs and 275 million music CDs.
Macrovision has its corporate headquarters in Santa Clara, California, with international offices in London, Frankfurt, Tel Aviv, Tokyo, Hong Kong, Taipei and Seoul.
http://www.macrovision.com/company/news/press/newsdetail.jsp?id=Mon%20Jun%2007%2010:23:45%20PDT%2020...
Americ Disc becomes first Macrovision All Product Reseller
Americ Disc has finalized agreements with Macrovision to become an official reseller of CDS, SafeDisc and DVD copy protection solutions. With these agreements, Americ Disc becomes the first independent replicator to have “All Product Reseller” status.
Americ Disc is the first independent replicator to offer the new Macrovision CDS300 solution for music CDs in the U.S. The CDS technology enables consumers to access and play music on their PCs while protecting that music against ripping, burning, and unauthorized file trading.
CDS-300 includes a unique component – CDS Protection Studio. This is a software “authoring” utility used by record labels to tailor the user experience when consumers use the Macrovision CDS-300 player to play a protected CD. From a single interface you can:
• Enter the title of an album and set the playlist
• Attach artwork to customize the background of the player
• Set the compression rates for second session audio tracks
• Set DRM rights:
• Specify the number of exports allowed
• Specify the number of CD burns allowed
http://www.americdisc.com/NL/newsletter-no6.html
WHO IS AMERIC DISC? Americ Disc is a leading North American supplier of CD/DVD manufacturing services to the multimedia industry. With a solid expertise that goes beyond replication, Americ Disc provides a single source solution for your media production projects. Our services include CD and DVD replication, CD-R duplication, media printing, packaging, distribution and fulfillment.
Founded in 1986, we currently operate CD/DVD manufacturing facilities in North Carolina, USA and Quebec, Canada, along with service and distribution centers in Minnesota and Montreal.
Americ Disc is owned and managed by its senior executives, together with Transcontinental of Montreal, a leader in the North American communications industry and MPO of France, the largest independent optical disc manufacturer in Europe.
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