RealNetworks, Microsoft Face
Off on DRM
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作者 / Streaming Media Jose Alvear
RealNetworks’ launch of the RealSystem Media Commerce Suite
is the first spark in an impending battle with Microsoft and
others in the digital rights management arena.
By Jose Alvear
June 22, 2001
Streaming Media Research
On Wednesday, RealNetworks Chief Executive Officer Rob Glaser
unveiled a digital rights management solution called RealSystem
Media Commerce Suite to empower the “next phase of digital
media delivery.” The long-awaited DRM system will be used
to power the security of MusicNet, the digital music company
formed recently by RealNetworks, BMG, EMI and Warner Music.
During his keynote at Streaming Media West 2001, Glaser showed
the first live public demo of MusicNet, a browser-based subscription
service that lets users search and store their music online.
In the demonstration, Dave Halprin, MusicNet’s director of
product marketing, illustrated how a user can stream and download
music after acquiring a license from the RealSystem Media
According to Glaser, the DRM system, which was in planning
for about two years, was one of the “missing pieces” of such
a service. Some of the tamper-proof technologies came courtesy
of Aegisoft, which RealNetworks acquired in January 2001.
Glaser said that RealNetworks wanted to take an integrated
approach. “We wanted to unveil a very comprehensive solution
to the marketplace,” he said.
Glaser stressed that the company wants to securely deliver
“all media, to all devices,” in any format including downloads,
streaming, peer-to-peer, and even physical form.
To underscore the importance of the new technology, Ben Rotholtz,
general manager of systems and tools for RealNetworks, said
this is one of the company’s top three announcements ever.
Late to the Game?
Microsoft, however, did not seem impressed at the news. According
to Michael Aldridge, lead product manager at Microsoft’s digital
media division, “We’ve had [DRM] since 1999.” He said that
Microsoft has powered over 8 million secure transactions already,
with audio, video and even e-books.
Microsoft’s DRM technology is also in its second version
— the company released DRM 7.0 in July 2000. “[RealNetworks’]
DRM is coming late to the game,” said Aldridge. “They have
a lot of catching up to do and will have a huge learning curve.”
He pointed to services like CenterSpan’s Scour, a file-sharing
system that operates exclusively with Windows Media and that
uses digital rights management to control access to files,
so if a user shares a file with someone else, that user must
register and use Scour to play the file.
Aldridge pointed to announcements this week that showed Windows
Media being adopted by digital asset management companies
to control and protect content. Partners such as Mediasite,
Bulldog and Jaguar have built on top of Windows Media to help
manage digital media for news organizations and pay-per-view
systems. “We’ve developed great core technology that allows
customers to build on top of that,” said Aldridge.
Phil Schiller, vice president of worldwide marketing for
Apple, said DRM is “very, very important.” But with RealNetworks’
announcement, Apple is the only major player not to have its
own DRM solution. This may make QuickTime less attractive
to content providers that want to make money with audio and
video. “There are digital rights systems that work with QuickTime,”
said Schiller, pointing out SealedMedia as one such provider.
Schiller wasn’t convinced, however, that RealNetworks’ solution
is the best way to go. “It’s important for the industry to
have solutions that work with all,” he said. “It’s still a
wild, wild west for DRM and we need to have standards.”
What Price DRM?
When Real’s Rotholtz sees Microsoft’s claims of 8 million
secure transactions, he scoffs. “I would strongly question
that number,” he said, wondering what percentage of transactions
actually generated some revenue. When asked what level of
success RealNetworks would settle for, Rotholtz said, “Eight
million transaction in 10 months? That’s pretty sad.” He said
that Microsoft, in the end, just wants to sell more copies
of Windows. “We don’t have an agenda,” he said.
But RealNetworks has yet to release information about how
it intends to price the new RealSystem Media Commerce Suite.
Rotholtz said to expect some pricing news in 30 to 60 days.
But some clues are already emerging. Rotholtz said that although
RealNetworks won’t act as a clearinghouse for transactions,
companies will have “a relationship” with RealNetworks. “We’re
in the water together,” he said.
Ready to Pay?
DRM solutions are clearly beginning to mature, but are consumers
ready to pay for audio and video content? Despite the big
news by RealNetworks, consumers have shown they prefer to
get their content for free — what’s often referred to as the
“Napsterization” of society. Glaser said that RealNetworks’
GoldPass subscription service — which now has over 200,000
subscribers paying about $10 a month — is proof that users
are willing to pay. GoldPass features premium content from
the NBA, Major League Baseball, exclusive music and more.
Glaser said that a lack of DRM standards is what’s holding
back a lot of content providers from going online. “A lot
of content owners say, ‘Heck, I’ll just wait until next year
or next month’,” he said. According to Glaser, XMCL – the
technology behind the Media Commerce Suite — will “fuel the
availability of digital media and lower the cost of deployment
because there’s no custom work to build a solution.”
XMCL, Glaser said, will eventually be submitted to standards
bodies like the W3C or the IETF for ratification. Glaser hopes
to push XMCL as a standard “much like HTML was unleashed on
the Web.” He pointed out that RealNetworks has done similar
things with SMIL and RTSP, now standards in the streaming
industry. “It’s great for the industry and the spirit of collaboration,”
With a list of backers that includes technology companies
and content owners (including IBM, Adobe, Sony, MGM Pictures,
Intertrust, Sun and Starz Encore), RealNetworks is in direct
competition with Xerox spin-off ContentGuard. ContentGuard
is pushing for the XrML (eXtensible rights Markup Language)
standard, with the help of Microsoft’s DRM technology. Partners
backing XrML are Adobe, Xerox, Hewlett-Packard, Portal and
others. It seems the competition between XrML and XMCL—and
RealNetworks and Microsoft in the DRM space — is just beginning.