Inferior Content Protection
Digital Rights Management (DRM) is often seen as a way to encrypt and protect content but poorly implemented it can be the equivalent of locking a box and leaving the key on top.  Where as well implemented, DRM can be a powerful tool for marketing and monetizing content. It can enable the transfer of content to multiple devices and empower different usage models.

This is not opinion; the analysts are saying the same thing. According to the research firm Frost & Sullivan, a lack of effective DRM over mobile channels will cost Europe 2.7 billion Euros (about $3.44 billion US) in 2006 alone. They also report that around 80 percent of mobile phone content has been hacked or downloaded to date. Ian Brown, a senior research manager at the Cambridge-MIT Institute in England, says that DRM will not protect the music and film industries' content as it is easily circumvented by adept hackers. What is needed most urgently is 100 percent elimination of revenue loss due to fraudulent practices such as password sharing with a superior content protection and access control system that has added security layers on top of DRM.

Fear of Losing Market Share
Today, both traditional and new media companies are in a frantic rush to distribute content over newer platforms, or at least have a strategy in place for doing so. For example, in an effort to usurp Apple’s “download dominance” in the U.S., CBS and NBC have formed partnerships with Comcast and DirectTV respectively to offer a downloadable selection of their best shows at 99 cents each. Jessica Reif Cohen, a media analyst at Merrill Lynch, states that profits from online advertising and paid content could represent up to 8-9% of total earnings for Disney, Viacom and News Corporation within the next 3-5 years.

Clearly, this market is moving very quickly and therein lays the danger. Too many media companies, both big and small, are experimenting at this moment without having a long-term plan in place. Many of the technologies being used in these experiments are very “sticky” and may involve enormous future efforts to support or migrate away from.  The audio and video content market promises large gains but misjudgments can also result in major setbacks.

 

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