Old but relevent:
Will Digital Downloads Pay?
Industry players struggle to develop business models that will give free file-swap services a run for their money.
By Eileen Rivera, Tech Live
January 9, 2002
LAS VEGAS -- Plenty of challenges lie ahead for music companies and movie studios in the fully digital post-Napster era. But most industry insiders are optimistic that they can make Net distribution pay off.
"I think certainly there can be a legitimate business model, and we see companies that are coming out now, especially those that are aligned with some of the major content producers and distributors," said David Leibowitz, co-founder and director of Verance, during a panel discussion Tuesday at the 2002 International Consumer Electronics Show.
During a session titled "Digital Download -- Cracking the Code to Profitability," music and movie industry experts discussed how to balance the strong need to protect intellectual property and content with manufacturers' rights to develop and market new technology.
MusicNet and pressplay (both launched by major record labels at the end of 2001) are the first examples of legitimate business models that hope to counter the popularity of free file-swapping services.
"I think the record labels are coming along," said Mark Bale, panel member and manager at e.Digital, a manufacturer of MP3 devices. "And I think that there are now supportable players in the market such as ours that can support timed-out, subscription-based content."
However, MP3 players with technology like e.Digital's secure management are few, and other intellectual property protection methods like CD watermarking are not foolproof.
As a result, the movie industry has hesitated to provide rich digital content on the Web.
"I think the Internet is going to be a tremendous opportunity for motion picture companies to deliver movies to consumers," Fritz Attaway, executive vice president of the Motion Picture Association of America, said during the session.
"I don't think consumers, or at least the vast majority of consumers, are going to want to do it through these file-sharing services like Gnutella. I've seen them; they're hard to use, at least for me. And if you've seen it, half of it is pornography," Attaway said.
Overall, the panelists said they believe digital download business models must be consumer-friendly to succeed and that the ultimate arbiter of what business model will work will be the consumer.
"It can bite the industries in their butt if it's not done in a way that is seamless and transparent to the consumer so that it doesn't create more work for them or more effort," Leibowitz said.
Originally posted January 9, 2002
Those claiming that EDIG isn't on the ball with DRM solutions are sadly misinformed (or deliberately deceitful). We have been involved with DRM for many years now. That we have produced only one product incorporating DRM functionality to date is a reflection of market demand, not technical prowess. The O 1000 platform can readily be upgraded to comply with DRM standards via a simple (at least to the user) firmware upgrade.
Always tell the truth. Then you'll never have to remember what you said the last time.
