September 24, 2007
Volume 19, Issue 4
Nine Billion Videos Viewed Online Monthly
According to a comScore recent Video Metrix release, nearly 75 percent of US Internet users now watch an average of three hours of online video per month, with Americans viewing more than 9 billion videos online monthly.
Google Sites ranked as the top US video property with nearly 2.5 billion videos viewed (27% share of videos), 2.4 billion of which occurred at YouTube. Yahoo ranked second with 390 million (4.3%). Peer-to-peer television (P2PTV) service Veoh ranked ninth at this point with 53 million.
In total, nearly 134 million Americans view online video monthly, or approximately three in four US Internet users. Google Sites also captured the largest online video audience with 67.8 million unique viewers, followed by Fox Interactive Media with 35.8 million and Yahoo with 35.3 million.
Other notable findings include: the average online video duration was 2.7 minutes and the average online video viewer consumed 68 videos, or more than two, per day.
Veoh Kicks Off NCAA Football Channel
Excerpted from MediaPost Report
Veoh Networks And Collegiate Images, LLC announced the launch of a rich NCAA Football Channel on P2PTV service Veoh, featuring an exclusive “NCAA Football Custom Highlights” sportscasting application that allows college football fans to create and share their own NCAA Football online video-highlight reels.
The NCAA Football Channel on Veoh gives college football fans access to many of this season’s NCAA football game highlights every week. Fans can use the NCAA Football Custom Highlights application to pick their favorite game highlights by conference, school, player, position, or play and build custom video highlight reels that they can easily e-mail or embed on their MySpace pages, Facebook profiles, personal blogs, or websites.
The NCAA Football Channel and Custom Highlights application is available for free at www.veoh.com/ncaafootball.
Veoh will be updated with fresh NCAA Football video clips twice a week, giving fans the opportunity to view up-to-date game footage and build new highlight reels leading up to and following each weekend’s games.
Report from CEO Marty Lafferty
 The US ban on Internet taxes that has been extended twice since 1998 will expire on November 1st. The DCIA asks all DCINFO readers to contact your Congressional leaders now and urge them to take action to continue to keep taxes off the Internet.
Broadening access to the Internet, expanding consumer choice, promoting confidence and growth in our economy’s information technology (IT) sector, and encouraging the deployment of broadband services at lower prices can all be the beneficial results of this effort.
Protecting consumers’ interests and reducing costs through increased market competition in consumer video, voice, and data services and other areas to ensure lower prices and help achieve broadband access for all can also be achieved with such a measure.
We strongly support the call-to-action of Chairman Gordon Smith (R-OR) of the Senate Republican High Tech Task Force who, along with Senators John McCain (R-AZ), John Sununu (R-NH), Trent Lott (R-MS), and Wayne Allard (R-CO), this week spoke in favor of a permanent moratorium.
This ban is essential to the continued growth and success of the distributed computing industry. Taxation of the Internet would slow its advancement and restrict its benefit to consumers. Such taxes would also discourage investments that are essential to expand broadband access in rural and underserved areas and increase broadband speeds.
According to Senator Smith, “People use the Internet to access information and purchase goods and services. It is inappropriate to tax someone for walking into a library or a shopping mall and by the same rationale we should not be taxing the Internet. Congress has very little time to act before Internet access becomes vulnerable to burdensome taxation. Internet access helps children in school, bolsters local businesses, and encourages innovation. We must extend this moratorium and keep the Internet free of taxes.”
Senator McCain added, “It’s important for Congress to pass a permanent ban soon, before state and local governments begin to tax Internet access. Those who wonder what impact Internet taxes could have should look to US telephone and mobile phone bills, where taxes are up to 20 percent of the cost. We cannot allow that to happen to the Internet – likely the most popular invention since the light bulb.”
Senator Sununu noted, “A permanent ban is needed. The Internet is critically important to interstate and global commerce. It makes no sense to have a national and global communications and business network subject to taxes by every state, city, and county in the country.”
And Senator Lott concluded, “If it’s the right thing to do, we ought to make it permanent.”
Since the moratorium was first adopted in 1998, tremendous investment, growth, and innovation in the scope and use of the Internet have occurred. By preventing unnecessary taxation of the Internet, Congress has promoted the continued expansion of technology and e-commerce, including P2P and social networks, P2PTV, peer-assisted CDNs, and more.
In 2003, when this ban was last extended, the House of Representatives championed legislation that would have made it permanent. This time around, two bills, the Permanent Internet Tax Moratorium Act – S. 156 and H.R. 743, can finally accomplish that.
State and local Internet taxes could add 20-to-25 percent to the average consumer’s web access bill – a tax hike of $150 or more per year - relegating millions of Americans to the wrong side of the digital divide. What’s more, this would be duplicative taxation, since the primary means of Internet access is via telephone and cable lines, and these services are already taxed at many levels.
Internet taxation would also hinder small businesses from gaining access to the technologies they need to compete. Educational and research institutions with limited budgets would also suffer. America still lags behind our economic competitors when it comes to wiring homes and businesses with high-speed Internet access and broadband. America ranks 16th in the world in terms of broadband deployment, behind countries like South Korea and Japan.
Widespread broadband deployment is the key to unleashing a new round of distributed computing gains in productivity and entrepreneurial activity. More than a million new jobs stand to be generated as a result of the broadband build-out, enough growth to generate more in taxes than states and localities could hope to raise by taxing Internet access, e-mail, P2P, VoIP, and other online services.
So why not just extend the moratorium for a few more years? Because making broadband available on a near-universal basis and expanding capacity for promising new services like P2PTV will require billions of dollars in private sector investment. Telecommunications companies are hesitant to put such capital at risk as long as the tax man keeps lurking around the corner, threatening to dampen the market for broadband.
Congress has a choice to make. It can allow state and local governments to saddle Internet users with new taxes and fees. Or it can promote investment in infrastructure, technology, and broadband applications to help reduce costs and expand the deployment of Internet-based technologies. Contact your Congressional leaders now and let them know the right choice to make. Share wisely, and take care.
Joost Gets Ripe Networks
Excerpted from TV Week Report by Daisy Whitney
Ripe Digital Entertainment struck a deal with P2PTV service Joost to offer three of its digital networks. Under the agreement, Joost will carry RipeTV, OctaneTV, and FlowTV.
Ripe’s networks are distributed across multiple venues, including video-on-demand (VOD), mobile-phones and broadband.
RipeTV focuses on beautiful women and comedy, OctaneTV on motor sports, and FlowTV on hip-hop music and culture.
Babelgum Signs Off the Fence
Excerpted from New Media Age Report
Global P2PTV network Babelgum has signed a content distribution deal with independent production company Off the Fence.
The licensing deal includes 200 hours of non-fiction programming and niche content such as travel, natural history, science, and health, and films including “Europe’s Secret Earthquakes” and “Wild Asia.”
The deal was brokered by Erik Schuit, head of distribution at Off the Fence.
Off the Fence joins Babelgum’s existing content partners, including Associated Press, Entertainment Rights, Gong Anime, IMG, ITN, Ministry of Sound TV, Reuters, Shine Limited, and Zed.
Ellen Windemuth, Managing Director of Off the Fence, said, “This is an exciting deal for Off the Fence, and reinforces our commitment to direct-to-consumer business via new media platforms.”
Valerio Zingarelli, chief executive at Babelgum, said, “Off the Fence helps Babelgum provide quality niche content to our customers meaning they can choose what they watch and when they watch it. Off the Fence has the type of factual programming the discerning consumer wants to be able to access at their leisure.”
Kazaa CTO to Head BBC iPlayer
Excerpted from Broadband TV News Report by Julian Clover
The BBC has turned to the P2P service Kazaa for its head of digital media technology. The organization’s former Chief Technology Officer (CTO) Anthony Rose is to take responsibility for the next generation of the BBC iPlayer. The BBC plans to create a unified embedded media experience across its online properties.
During his six years at Kazaa’s affiliate for licensed content distribution, Altnet, Rose was responsible for a series of projects and placements including P2P networks, DRM-based content publishing, and social networking services.
Prior to Kazaa, Rose was Vice President for Technology at Sega Australia.
Rose will report to BBC Future Media and Technology Group leader Erik Huggers, and completes the reorganization of the division.
The Future of Integrated P2PTV
Excerpted from Daily IPTV Report by David Cotriss
Consumers want all their communication needs met with a single package rather than with individual services, as is indicated by telephone and cable companies offering TV, voice, and wireless service bundles. But some companies are going far beyond that, offering more than triple-play to meet every need imaginable – including P2PTV.
Damaka is one company leading the movement toward an integrated future and stands out from the pack with its large number of offerings. The company could change the direction of P2PTV by allowing providers to offer a wide array of services such as instant messaging (IM) and file sharing with their P2PTV offerings. We interviewed Damaka Director Chandan Chopra about the company’s offerings and plans for the future.
DailyIPTV: Your company offers an integrated package of various communication services including P2PTV and voice over Internet protocol (VoIP). How do these work and how do they integrate with each other?
Chandan Chopra: Damaka offers comprehensive P2P standards-based communication, collaboration, and multimedia software. Damaka provides voice, video, IM, file transfer, desktop sharing, P2PTV and other features in a real-time environment on both desktop/laptop and wireless devices such as smart-phones. Damaka also offers its white-label solution to operators and enterprises. The Damaka platform is based on industry standards and uses patent-pending technology to provide a secure P2P environment for Internet users worldwide.
Damaka P2PTV enables users from anywhere in the world to watch TV via the Internet. P2PTV is a new addition to the software’s existing features list, which includes IM, DialOut, videoconferencing, desktop/application, file sharing, and Internet radio. Damaka also plans to roll out video-on-demand (VOD) TV channels and media content, subscription services, customization of video services, and video-based targeted ads.
DailyIPTV: Your service is based on P2P technology. How does that work and why did you choose this method?
Chandan Chopra: The technology underpinning Damaka’s offering is the personalization of standards-based distributed soft-switching and P2P networking. In a traditional VoIP network, the soft-switch is located on the carrier’s premises. All VoIP calls are controlled by the carrier. In a P2P network, all sessions take place between the participating computers — there is no intermediate server. Damaka’s Personal Soft-switch system provides advanced features, high performance and secure collaborative multimedia communications.
DailyIPTV: How does your P2PTV offering compare to services like Joost and AT&T’s U-verse from a technology and consumer perspective?
Chandan Chopra: Damaka’s P2PTV offering allows service providers, operators, and carriers to integrate media content with our Session Initiation Protocol (SIP) P2P communication platform. Damaka’s P2PTV solution is a multimedia framework that enables a personalized TV and entertainment experience. Service providers can deliver an enhanced experience to their customers with digital TV features, as well as communication/collaboration and media-sharing capabilities, to compete in the television market.
Since Damaka uses a P2P platform, there is no need for a set-top box. Customers are not locked down to one particular location. They can be anywhere in the world but still have their channels (video content) available to them. In terms of technology, the platform is extremely flexible and robust, as any type of media can be made available while keeping the streams secure and providing total control to service providers/carriers.
DailyIPTV: As features such as content sharing and chat become part of P2PTV services, what role will they play in the P2PTV market moving forward and how important will they be to consumers? Is multitasking something P2PTV viewers really want?
Chandan Chopra: Consumers want communication experiences to be richer and more integrated. They want their TV, IM, voice services and e-mail to find them, on whichever device they use, wherever they are, whether at home, at work, or on the go. They want simple sign-on and billing. They want personalized, intelligent, and seamless interactive features that can enhance and simplify their lifestyles.
Integrating a P2PTV framework with Damaka’s SIP P2P communication platform allows users to benefit from all the communication and collaboration features while enjoying their TV. Such features will not only allow service providers to retain customers but also provide various revenue-generation streams like profile/context-based ads.
DailyIPTV: You will be rolling out new features such as VOD and targeted ads. What other offerings do you have planned for the near future?
Chandan Chopra: Along with VOD, we plan to provide solutions for content owners to publish their content easily from within Damaka. Future releases will provide a more interactive and personalized multimedia experience. By combining the benefits of VoIP with P2PTV, Damaka is well positioned to provide consumers with a richer, personalized, more integrated experience.
Internet Traffic Set for Global Meltdown?
Excerpted from Tech Report by James Rivington
Global Internet speeds could be about to take a severe hit. An astronomic rise in P2P BitTorrent traffic is anticipated next week when file-swappers share DivX-encoded files of new US shows such as “Heroes” and “Prison Break.”
A massive 4.2 petabytes of data could be downloaded next week as a result. That’s the equivalent of a billion MP3s or 890,400 DVD-quality movies.
Why now? Because the new fall TV season is just about to kick off in the US. TV show-swapping is rampant across the Internet and BitTorrent traffic looks certain to skyrocket as thousands of people start downloading the brand new shows.
Tech-savvy UK TV fans don’t want to wait to see the latest episodes of their favorite US TV series. But the burden of this extra web traffic could leave ISPs struggling to cope with the load.
The numbers don’t make pretty reading. Imagine over 4.2 million gigabytes of TV show data being piped across the internet every seven days.
Astonishingly, that works out to be 6.9GB of data downloaded every single second. These are fairly modest estimates too, so the true numbers could well be a lot higher.
One show recorded in standard definition amounts to roughly 350MB, and each episode is downloaded around 200,000 times on average. Some are uploaded in 720p high-definition and so have much bigger file sizes, while others are not downloaded as many times as others. So it’s reasonable to assume that these factors even each other out.
Roughly 60 torrented US shows per week amounts to 21GB of information.
Much of this traffic will go through UK servers, more people in the UK use BitTorrent than any other country. And the figures don’t even include those who download TV shows via other P2P networks such as eDonkey - if they did they would most likely be higher.
Emmy-winning shows “Lost” and “24” are set to start their new seasons, both airing on a Monday night. Mondays and Tuesdays will see the broadcasting of the new episodes of these two shows plus “Heroes,” “Desperate Housewives,” “Prison Break,” “Family Guy,” “Dexter,” “Curb Your Enthusiasm,” and more. This could lead to the majority of extra BitTorrent traffic coming midweek.
A recent article on Ars Technica suggests that BitTorrent traffic already makes up around 90 per cent of all web traffic. Add to that the vast number of videos streamed on sites like YouTube and it’s clear that web video is responsible for a massive majority of bandwidth use in all territories.
The rise of BitTorrent as a method of transferring large files among users has led to action being taken by many UK ISPs. Many of them limit the amount of bandwidth that BitTorrent clients can consume. Virgin Media, for example, restricts the download speed of users that download over 350MB in peak hours.
We spoke to Orange Broadband who told us, “We ask customers using file-sharing software or downloading large files to do so considerately. If we see regular high usage that could impact on another user’s experience, we will get in touch with the customer and discuss ways to reduce their level of usage.”
Cisco Outlines Next Web Revolution
Excerpted from CNET News Report by Liam Tung
A Cisco Systems senior executive this week said he believes that a major wave of innovation is due, thanks to the web, growing urban populations and low hardware costs.
“No army can withstand the strength of an idea whose time has come,” Senior Vice President Howard Charney said, borrowing from Victor Hugo to summarize the power of the Internet.
Speaking in Brisbane, Australia, this week, Charney said the world – now split into “information-rich” developed countries and “information-poor” developing countries – is on the precipice of a major wave of innovation.
If the so-called $100 laptop developed by Nicholas Negroponte’s One Laptop per Child nonprofit becomes available, as planned, to 2 billion people in China and India, and with more than half the world’s population living in cities by 2008, the effect on information-rich and information-poor worlds will be profound, Charney said.
Greater access to information will improve living standards by removing isolation, which will, in turn, stem the growing disparity between productivity growth rates of information-poor and information-rich nations – a gap that, according to an Organization for Economic Cooperation and Development report, has doubled in the last decade, Charney noted.
However, he said his vision is not entirely philanthropic. For developing nations to improve life, they will need networks – Cisco’s networks, he hopes – regardless of whether the networks are based on fiber-optic lines or wireless technology.
“You know, we’re very big,” Charney said. “When you’re big, you have societal obligations...But are we going to be making profits off building networks in developing countries? Yes, there is a business proposition.”
Intelligent Business Research Services analyst Kevin McIsaac agreed that “enabling technology” like a laptop will help, but he posed the question, “What else will they need?”
In Bangladesh, microfinance specialist Grameen Bank lent as little as $5 to women to buy a mobile phone, McIsaac noted. “This was incredibly important to enable the technology for these women to get started. They would rent-out the time on the phone, which was enough to live, pay the mortgage and was a vital piece of technology in the village.”
Instead of walking two days into the village to sell their produce, the women were able to call local buyers and negotiate better prices, which offered a better outcome than would have been possible under stressed conditions, McIsaac added.
However, innovation won’t simply happen for information-rich countries, Cisco’s Charney said.
“Our challenge today is in recognizing the potential of new technology and putting it to use faster than before,” he said.
“To sustain innovation, we need investment, and sometimes that seems like crazed speculation,” he said. “This does not mean people should take greater risks. Investment occurs in different ways, and sometimes, people get caught up in making money, and they build out business models that don’t turn out to work.”
Charney cited as an example past investments in dark fiber, or fiber-optic cable that had been laid but was not put to use, that eventually was used to help launch a viable business model: the Indian outsourcing industry, which now is worth hundreds of billions of dollars, he said.
However McIsaac warned not to interpret retrospectively good investments for efficient outcomes. “Value has come out of the dot-com boom, but there was an enormous waste of investment,” he said.
“Business needs to take a portfolio view of investments in technology. Five percent should go into blue-sky investments, like wikis and Web 2.0 for knowledge management projects, but 30 percent should go into keeping IT running and improvements on existing technology.”
Nareos P2P PeerBox Tops 100,000
Excerpted from TMCnet Report by Raju Shanbhag
If you’ve ever wished for a P2P service on your mobile phone, PeerBox from Nareos just might be the answer. The beta version of PeerBox already has 100,000 users.
Nareos claims PeerBox is the only mobile application providing universal P2P file-sharing capabilities on mobile phones. The service lets users access millions of authorized videos and pictures, plus offers a social-networking platform.
With Peerbox, users can share unlimited content on their mobiles. The technology behind this solution makes it easy to share files like user-generated video and photos. Users can also create personal channels and store their favorite content there, later to be shared with their friends and family. The application is available as a free download.
“We are thrilled to be gaining momentum at such speed, as our service is now being used in over 170 countries,” Nareos CEO Alexander Lazovsky said. “The tremendous word-of-mouth distribution, industry recognition, and adoption rate of our platform is proof that people are looking for a way to socialize, create and share content without being tied to a computer. We look forward to future successes with pending partnerships on the horizon.”
Movie Downloads Get a Boost
Excerpted from LA Times Report
The organization that licenses DVD security software cleared the way Thursday for movies bought over the Internet to be burned onto a DVD that can play on any machine – a move that could dramatically change the way movies are sold.
Industry executives hailed the decision by the DVD Copy Control Association to license software designed to allow content to be burned to one disc but not copied to others.
“This is great news,” said Curt Marvis, chief executive of movie download service CinemaNow. “We expect the proliferation of burners that can burn these types of discs.”
Concerns about unauthorized copying have led Hollywood studios to allow movies to be downloaded and viewed only on computer screens or portable devices. Cumbersome cables are needed to transfer the content to a TV set, but the files are not DVD quality and don’t look as good when enlarged.
Internet downloading wasn’t envisioned when DVDs were invented more than two decades ago. Standard DVD players are hard-wired with the keys to the digital security locks built into prerecorded DVDs.
But DVD burners on computers and writeable DVD discs don’t contain the locks.
The decision opens the way for download services such as those operated by Amazon, Wal-Mart, CinemaNow, and Blockbuster to offer download-to-burn options.
One Anti-Piracy System to Rule Them All
Excerpted from NY Times Report by Brad Stone
Hollywood appears to have a preliminary winner in its bake-off of anti-piracy technologies.
For the last year, the film industry, through its Palo Alto, CA-based R&D joint venture MovieLabs, has been testing a dozen so-called “digital fingerprinting” technologies. The technology purports to scan file-sharing sites, Internet service providers (ISPs), and peer-to-peer (P2P) networks to identify copyrighted material.
Yesterday in Los Angeles, people affiliated with the Motion Picture Association of America (MPAA) talked about the ongoing tests at a day-long anti-piracy workshop that the MPAA co-hosted with the University of California. In his introductory keynote at the event, UCLA professor and Internet pioneer Leonard Kleinrock showed a single slide that suggested that one of the anti-piracy filtering companies had outperformed the other 11, with the highest number of matches of infringing content and lowest number of false-positives. But professor Kleinrock and MPAA execs declined to name the participating companies or who had scored best on the test, saying that secrecy was a pre-condition for their participation in the tests.
Nevertheless, afterwards, executives from Santa Clara, CA-based Vobile were crowing in the hallways of the Universal Hilton Hotel.
The two-year old company’s technology, called Video DNA, has apparently bested others from the Royal Philips Electronics, Thomson Software & Technology, and the highest-profile digital fingerprinting company, the Los Gatos, CA-based Audible Magic, which has deals to filter video-sharing sites like YouTube and Microsoft’s Soapbox.
The MPAA told Business Week in the spring that Vobile was doing “very well” on the tests.
Movie Labs stress-tested the anti-piracy systems by loading hundreds of hours of copyrighted video content into the databases of the various filters, and then by flooding them with thousands of video files, some distorted, darkened, and cropped, to try to scuttle their ability to find matches.
In the next phase of the ongoing tests, MovieLabs will see if the systems can handle ever larger quantities of copyrighted works. Theoretically, adding more songs, TV shows, and movies in their databases could slow down these systems—and the Internet video sites that use them— since it could take longer to find possible matches.
MovieLabs has been sharing tests results with its member movie studios since the summer. MovieLabs chief executive Steve Weinstein says the technology is ready for prime time. “In a year you’re going to see many Internet companies using it. This technology has shown its viability.”
DRM Demystified
Excerpted from Streaming Media Magazine Report by Christopher Levy
When Streaming Media Magazine asked me to write an article about the state of digital rights management (DRM), I admittedly jumped at the opportunity. Not since the digital media format wars of the late ‘90s have we seen a subject galvanize an audience so quickly. Postings about DRM on forums regularly draw in a vocal crowd with a laundry list of complaints as well as kudos about DRM and its widespread use.
That being said, there has been a lot of negative press lately about DRM, primarily focused on the music industry and its woes. To some extent, the confusion created as a result has created more questions than it has provided answers.
Many have pointed to the recent announcements by EMI and Universal announcing that they will begin offering DRM-free music in various online outlets as an indicator of the death of DRM. Let’s look at what is really going on here. The iPod uses a DRM technology called FairPlay, which Apple does not license to third parties. This really leaves the music industry with very few options if they want to sell music directly to the public, especially to consumers with iPods.
To successfully compete with the iTunes monster they helped create, the record companies have one viable option: to set up their own music stores sans-DRM in the hope they can begin to claw back those millions of customers they sent to Apple. It’s not hard to envision a music industry exec writing, “Note to self: Next time we endorse a technology we cannot license, let’s be sure to get our customers’ names and billing information.”
Apple made DRM a mainstream technology on its way to selling more than two billion songs encrypted with FairPlay, and yet it refuses to play fair with the marketplace. It is a wonder that Apple has not received more pressure to license FairPlay, given that the company would create a much broader market for pay-media content on the iPod. However, in doing so, they would lose their stranglehold over the iTunes marketplace, and this is apparently something Steve Jobs is not willing to let happen.
All of this hype aside, and as shocking as it sounds, the music industry’s woes are great for the press and provide a lot of fodder for writers and publishers to create ad impressions on websites—and that’s about it. The music industry is not and has never been a tastemaker for the broader online video marketplace or digital media industry at large. Therefore we have to look past its current situation and search out the broader implications of deploying DRM technology for profit and long-term growth.
So let’s set the record straight: DRM is alive and well and a key technology in use by content owners and licensees, media distribution businesses, and pay-media portals around the globe. This past year has seen a startling number of media monoliths deploy new DRM-enabled offerings – including NBA.com offering the entire NBA Finals; UFC.com providing unlimited access to pay-per-view fights online; and American Idol selling full-length music downloads from the wildly successful TV show on AmericanIdol.com. TV New Zealand even got into the act with its award-winning TVNZ on-demand service.
If you still have doubts, look no further than the highly popular P2P technology company BitTorrent, which recently launched a DRM-enabled offering with full-length movies and TV shows from several major studios and networks.
Let’s take a look at the major DRM technology players today.
At NAB in April 2007, Adobe rolled out several upgrades to its Flash Media Server 2 that are DRM-like and provide greater security for Flash Video objects. If you are providing Flash content as a progressive download, users can record the content from the cache in their web browser using a “ripper.” However, streaming the content using the proprietary Adobe Real Time Messaging Protocol (RTMP) results in increased protection from rippers.
From Adobe’s website: “By default, content delivered by Flash Media Server is wrapped inside an Adobe protocol called RTMP. Because this is an unpublished, proprietary format, none of the RTSP stream ripping programs have the capability to rip media delivered over Flash Media Server.” Adobe also supports simple domain and IP authentication schemas as well as SSL to further enhance the security of Flash content.
At IBC in September, Adobe announced some significant DRM and security upgrades to Flash Media Server 2, as well as a preview of Flash Media Server 3. The highlights of this preview included the announcement of a new encrypted version of the proprietary Adobe RTMP protocol (RTMPE) and a new object-based approach called “SWF hashing.”
“These two new technologies are designed to be seamlessly deployed using Flash Media Server 3 and are easily integrated with existing services,” according to Chris Hock, Senior Product Director for the Flash Media Server at Adobe. “We wanted the implementation of these new features found in Flash Media Server 3 to be as transparent and light as possible to ensure wide adoption.”
As expected, support for these two new features is provided via Adobe’s new Flash Player 9. Released in beta in late August, this product is codenamed “Moviestar,” a subtle indicator of how serious Adobe is taking its present and future content security and video delivery development efforts. To address the added expense and system lag that SSL introduces, Adobe designed the RTMPE protocol.
This technology provides further security for delivering streaming content from Flash Media Servers to a geographically diverse end-user audience. From Adobe’s website: “Similar in strength to our current SSL protocol (RTMPS), RTMPE can be leveraged by content owners and communication developers to add additional protection to their content.”
Adobe designed the new SWF hashing system to provide additional file-level security to streaming Flash content. This technology will also help protect SWF files from being reused, modified, or hosted in alternate locations and ensures the SWF file that is playing back is indeed the one created by the publisher.
Developers no longer need to purchase and maintain an SSL certificate or incur the traffic hit on their web platform, since the RTMPE and SWF hashing processes are performed via the Flash Media Server 3 and supported via the Flash Player 9. To take advantage of these new features, developers must push their end-users to upgrade their SWF engine to the Flash Player 9 bits.
With the increased encryption load at the server level, developers may see minor hardware and software performance degradation compared to unencrypted RTMP delivery without SWF hashing. This should be factored into future Flash Media Server 3 deployment plans and as a rule of thumb – “bigger” CPUs produce better results.
Adobe’s current RTMP standard has been well received by major content owners and licensees and, to date, the protocol has not been compromised. I asked Hock about rumors that RealNetworks had reverse-engineered RTMP and would soon be shipping support for RTMP recording in a future version of its industry-rattling RealPlayer. Hock was very clear about the company’s position on the matter: “To the extent that Real or anyone else would reverse-engineer RTMP, we would see this as a specific violation of our patents.” Hock further stated,
“We have communicated this to RealNetworks and to our customers and the public via our website.”
It’s safe to say we will see future announcements from Adobe regarding DRM improvements to the Flash ecosystem. When asked about Adobe’s future as a DRM technology innovator, Hock predicted that “we will continue to treat DRM as an extra layer of protection and continue to update and modify our technology. There is no holy grail of content protection and it’s a continued effort.”
For more on Adobe’s DRM, please click here.
Microsoft’s Windows Media Rights Manager Originally launched in 1999 as the “Digital Broadcast Manager.” This product has evolved over the past nine years into a widely deployed industry standard used by Amazon, Wal-Mart, Napster, MovieLink, AOL, Yahoo, and Rhapsody. There are literally thousands of licensees of the technology and a whole ecosystem of devices, phones, and portable media players that support the technology from the likes of Samsung, Phillips, Denon, Toshiba, Dell, Palm, RCA, HTC, and numerous others.
Often mistakenly referred to as “PlaysForSure DRM” or “Windows Media DRM,” the Windows Media Rights Manager is a free technology that can be licensed from Microsoft and includes both content encryption and license-key generation components. WMRM supports a variety of business models and output protection schemas and is built into the Windows Media Player, which ships on every Windows PC sold in the world.
For more information on Windows Media Rights Manager, please click here.
In April of this year, Widevine launched Cypher for Flash and demonstrated this product at NAB in Las Vegas. From Widevine’s website: “Widevine Cypher is a downloadable conditional access, digital rights management, and digital copy protection solution that secures linear broadcast, VOD, file downloads, progressive downloads, and streamed media.”
I recently spoke with the company about how this technology works and learned that Cypher uses a conventional DRM model of content encryption and license serving. Previously encoded Flash content is encrypted using AES 128-bit encryption via a Widevine Cypher encryption server. The output FLV content is electronically scrambled and in this state is basically unusable.
Content is then published to a Content Delivery Network or hosting environment and made available to consumers. At the point where a user requests to view or listen to a piece of content managed by Widevine’s Cypher, users are required to install and run the Cypher client.
The client then receives a license from Widevine’s License Server service to decrypt the content and securely passes it to the Flash client where it is played back on the user’s PC. The Cypher client continuously monitors the user’s playback environment and thwarts potential applications that attempt to copy or screen-capture streaming or downloaded SWF content.
For more information on Widevine Cypher, please click here.
Originally touted as a solution to address a variety of file formats, RealNetworks’ Helix DRM actually mandated that content be encoded in Real’s proprietary RealMedia format. Back in 2003, I called Real to get pricing on this product and was told that the Helix DRM Packager SDK was $180,000 and the Helix DRM License Server SDK included a license of $40,000 per CPU and required a special plugin for the RealServer if content was to be streamed. On top of these fees, Real wanted approximately 12% of any top-line revenue from the use of the product.
Needless to say, this product never took hold in the marketplace and was abandoned by Real when it moved to the Windows Media Rights Manager DRM platform for their Rhapsody offering. Helix DRM is no longer available from Real and today Real only offers a Helix Security technology that is similar to URL hashing using tokens, which is commonly available from many of the industry’s CDNs.
For more information on Helix Security, please click here.
DivX has been operating the OVS platform, which includes a DRM component, for nearly six years now and provides the service as a turnkey platform hosted by DivX for its customers. The product is primarily in use in the adult video marketplace, where companies like Gamelink and HotMovies use the technology side-byside with their Windows Media Rights Manager offerings.
DivX has done a great job of licensing their core DRM and codec technology to numerous different devices, portable media players, and DVD manufacturers to further support the playback of encrypted DivX content beyond the PC. However, they have not done a very good job of licensing the technology out to third parties, and to date there are no major media outlet licensees of the platform.
For more information on DivX Open Video System, please click here.
Christopher Levy (clevy@buydrm.com) is CEO & Founder of BuyDRM, a pay-media services provider with offices in Austin, Los Angeles, and New York. Stay tuned next week for more from Christopher on Microsoft’s PlayReady DRM for P2P.
P2P Influences Release Schedule
Excerpted from Tech Digest Report
If you’re a music industry bigwig, chances are you think P2P file sharing is the devil’s work. Well, at least, that’s what you’ve got to say in public, even if you do go home and spend the night trousering as much free music as you can. Anyway, the point is, major labels don’t like P2P.
However, following the leak of a bundle of e-mails from anti-piracy company MediaDefender, it seems some labels are using P2P as a guide to which songs they should release.
Specifically, Pussycat Dolls singer Nicole Scherzinger’s label Interscope asked MediaDefender to monitor how popular one of her album tracks was on file-sharing services.
“Interscope wants to know if Baby Love is picking up steam on P2P. They need to make a decision by early next week on whether they should switch to this song as the single,” reads the e-mail. If you can’t beat ‘em, at least let your marketing strategy be guided by ‘em...
Future of the Recorded Music Industry
Future of the Recorded Music Industry Part 3 is a blueprint for a completely new music industry called System-V.
Unlike the current music industry, System-V would be perfectly aligned with consumer behavior and with the powerful forces of technological change. Today, these trends are slowly destroying the music industry but, with System-V, they could be harnessed and used to generate a new category of revenue that could be enjoyed by record labels and music publishers.
The music industry’s problems are so profound that a major rethink is required. Concepts that the industry has held dear for decades now seem increasingly redundant. The industry’s value chain, its approach to pricing, the underlying infrastructure, the role of copyright, and even the industry’s core commercial model and its value proposition all need a radical rethink.
In a System-V world, music would be provided for free. Uncontrolled copying and sharing would be encouraged and DRM would be removed. System-V is not a rental model and users do not buy music. Existing copyright laws as they apply to sound recordings would be redundant.
A thriving developer program would be a critical component of System-V. Developers, entrepreneurs and established companies would be encouraged to create new, value-added applications, products and services that incorporated music, but they would not have to pay the music industry anything.
The System-V API would provide access to a wealth of information about the world’s consumption of music and allow third parties to develop broad range of new products, applications and services that would draw users and others into the System-V ecosystem.
This report describes System-V in detail by covering aspects such as the underlying strategic rationale, business considerations, infrastructure requirements, operational aspects and enabled user services.
Ad-Supported Music Becoming a Reality
Excerpted from Ad Age Report by Andrew Hampp
Launching a free, ad-supported music-downloading service has been not unlike downloading an actual song – unintended glitches may occur. But despite one early, high-profile stumble and the lack of a proven model, a pair of start-ups is still bullish on the business opportunity.
P2P service QTRAX hopes its song catalog, which is five times bigger than that of iTunes, will set it apart.
Last fall, the much-hyped Spiralfrog announced it would make its debut by year’s end as the first free, ad-supported major music service to offer downloadable MP3s of songs from a major-label music catalog (in this case Universal Music) with Perry Ellis as its first sponsor.
Spiralfrog held out in vain for other major catalogs and financial setbacks and serious in-fighting caused Spiralfrog to delay its December launch date and reorganize its ranks, resulting in the departure of 11 of its 23 original executives, including its CEO, former Universal McCann chief Robin Kent.
Nine months after its false start, Universal-backed Spiralfrog officially launched with an initial offering of about 700,000 songs. But it’s got at least one major competitor already on the horizon: Mr. Kent’s new ad-supported P2P music venture, QTRAX.
After the Spiralfrog falling out, Mr. Kent and his colleague Lance Ford, founding publisher of the US edition of Maxim, started a company called Rebel Digital and made ad-supported music service QTRAX its biggest project.
Targeted toward the 13-to-35 demo, it’s designed to compete with the P2P market rather than iTunes or Rhapsody, but has the support of all four major music catalogs – Universal, BMI, EMI and Sony BMG – and an aggregation of enough music publishers, exclusive live tracks, and obscure remixes to make for a launch catalog of roughly 30 million songs. ITunes, by comparison, sells only about 5 million to 6 million tracks.
“The core difference is the size of the catalogs,” Mr. Kent said. “The killer app for us is in the gray area – aggregating the P2P community as opposed to one website.”
QTRAX will officially kick off in the US by year’s end, and a major international launch is set for early 2008. Its revenue-sharing model gives labels a significant cut, said QTRAX Chairman & CEO Allan Klepfisz. “If we do well, they do well.”
Spiralfrog, for its part, seems to have made a recovery in the past nine months. Founder & CEO Joe Mohen said the catalog will be expanded with content from the major publishers in the near future, and he recruited another McCann vet, George Hayes, to head up ad sales. Charter advertisers include Colgate, Chevy, and Discover Card, whose ads will be served during the 90-second song downloads. Age-targeting allows the service to court spirits marketers as well. But for a site that was ready for launch a year ago, Mr. Mohen’s definition of early success for Spiralfrog seems to be more technical than engagement-based.
“The first three months will be all about making sure the system’s working, learning from the focus groups that we’ve made the enhancements they’ve requested, making sure the reporting’s up to speed, the glitches are worked out. Then we’ll start looking at the scale of monthly uniques,” Mr. Mohen said.
Coming Events of Interest
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Broadcasting 2017 – September 27th in London, England. What do the leading players in television and new media across Europe predict for the future of broadcasting? Find out during “Broadcasting 2017” at BAFTA. Join industry giants such as Silvio Scaglia, Founder & Chairman of Babelgum for a day of stimulating sessions.
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Digital Music Forum West – October 3rd–4th in Los Angeles, CA. The seventh annual Digital Music Forum event now at the newly renovated Hollywood Roosevelt Hotel. Several DCIA Member company executives will be featured speakers and the DCIA will present a special session on “The Evolution of P2P and Music” with BUYDRM’s Christopher Levy, FTI Consulting’s Roger Scadron, Javien’s Leslie Poole, PeerApp’s Mark Strangio, and VeriSign’s Stuart Cleary.
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PT/EXPO COMM – October 23rd-27th at the China International Exhibition Center in Beijing, China. The largest telecommunications/IT industry event in the world’s fastest growing telecom sector. PT/EXPO COMM offers DCIA participants from all over the world a high profile promotional platform in a sales environment that is rich in capital investment.
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P2P ADVERTISING UPFRONT– Sponsored by the DCIA October 29th in Los Angeles, CA in conjunction with Digital Hollywood Fall. The industry’s premiere marketplace focused on the unique global advertising, sponsorship, and cross-promotional opportunities available in the steadily growing universe of open and closed P2P, file-sharing, P2PTV, and social networks, as well as peer-assisted content delivery networks (CDNs).
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Streaming Media West – November 6th–8th in San Jose, CA. Streaming Media conferences have become the premier online video events in the world. Streaming Media West is totally focused on the business and technology of online video. The DCIA will participate featuring industry leading P2PTV providers and support services.
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P2P MEDIA SUMMIT LV – January 6th in Las Vegas, NV. This is the DCIA’s must-attend event for everyone interested in monetizing content using P2P and related technologies. Keynotes, panels, and workshops on the latest breakthroughs. The Conference will take place in N260 in the North Hall of the Las Vegas Convention Center and the Conference Luncheon in N262-264. This DCIA flagship event is a Conference within CES – the Consumer Electronics Show.
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CCNC 2008 – The Fifth Annual IEEE Consumer Communications & Networking Conference, January 10th-12th at Harrahs, Las Vegas, NV. Now co-promoted by the DCIA. The latest research developments and technical solutions in the areas of home networking, consumer networking, enabling technologies (including middleware), and novel applications and services. See www.ieee-ccnc.org for details.
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P2P ADVERTISING UPFRONT NY – Sponsored by the DCIA March 11th in New York, NY in conjunction with the Media Summit New York (MSNY). The industry’s premiere marketplace focused on the unique global advertising, sponsorship, and cross-promotional opportunities available in the steadily growing universe of open and closed P2P, file-sharing, P2PTV, and social networks, as well as peer-assisted content delivery networks (CDNs).
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