We noted in the Summer that Adobe had taken a license to Intertrust intellectual property which covers a wide range of DRM capability, patent licenses, but also the free source code that goes with its patent licenses which makes up its Marlin DRM components.
The immediate conclusion that we reached was that Adobe would offer a video capable DRM in the not too distant future, which might mean that Adobe Flash Video (FLV) would become a contender not only for the User Generated Content video that has meant that FLV files make up more than 50% of the video which travels across the internet, but it would become a focus for professional video content, new advertising based business models and a basis for video on the handset.
For the past four years at Faultline we have fretted over the potential lock in that a digital rights management (DRM) monopoly would give to a company like Microsoft, but although we believe that this might have been the aim of Microsoft, leveraging its omnipresent media player and operating system on the PC, this hasn’t really come to pass.
Instead it has been Apple that has built a multibillion dollar empire based on a locked DRM. The value of Apple when the company launched its iTunes Store was around $10 billion, whereas today, due almost entirely due to the lock in that the iPod’s Fairplay DRM gives Apple, the company is valued at well over $160 billion. It’s a real testament to the power of DRM.
We’re not saying that just anyone can use DRM to liven up its share price, but an original product with consumer appeal, launched with a DRM lock in can, in the right hands create $100 billion of wealth.
Microsoft has responded to both of these situations, the one where Adobe has created a new de facto internet video format, and the one where Apple’s DRM music lock in has grabbed it a monopoly position in online music, with a combination of its Silverlight video format, and its PlayReady DRM, which when combined will do exactly what Adobe has done, created a multiplatform, multi-distribution, protected video format.
But talking this week to John Landwehr, Director of Security Solutions and Strategy at Adobe, we suspect that Microsoft’s moves may, after all, be too late.
‘We’ve been in content protection ever since we made it possible to protect Adobe Acrobat files, back in 1994,’ starts Landwehr, reminding us that there is little new in Adobe being in the DRM business. In 1999 we added PKI (Public Key Infrastructure) capability, non-repudiation and allocated different permissions to different people who opened files.
‘In 2005 we added lifecycle rights, Department of Defense certification, and streaming media content protection. In 2007 we added the ability to protect native Office and CAD files, and shortly will introduce our own downloadable Media Player which will protect content transactions.’
‘Our systems were first used by the entertainment industry to protect film scripts. Studios noticed that movies were coming out with very similar plot lines to those they were working on, and they used our systems to ensure that could no longer happen.’
But now that Adobe has something approaching dominance of internet delivered video, it has had to court that same entertainment industry all over again. With YouTube full of Flash Video, and yet considered by broadcasters and content owners to be the new piracy bad boy on the block, Adobe has had to both convince Hollywood that it has its interests at heart, while at the same time providing the technology to refresh content business models.
‘Today we have Flash Video in the browser. When our Media Player comes off beta we will offer the ability to download files and play them offline, not just as a stream over the Internet, and that has to give way to a whole lot of new business models. We have to have the technology support download to own, download to rent, content that is locked to a user or a user location, and advertising supported free video where the adverts can’t be stripped out.’
And this of course is why Adobe wanted that Intertrust license, because it gives them shortcuts to many of these capabilities over the critical development period in the next year or two.
Just how Landwehr achieves all of this isn’t something he will go into a lot of detail about, but he will discuss some of it. ‘Flash video was first experienced in the browser, but by the addition of our own media player FLV files can be captured and replayed outside the browser where both the pipe and the data inside the PC remain encrypted. They require authentication from the player with the usual username and password protection to play a file, but content owners will also be able to lock it to that PC only.
A common module called RTMP converts the streams to SWF files, which are under the control of any SWF Player software such as the media player. These have to be architected to never allow unencrypted content to be cached anywhere on the device, which is the standard way for a ‘streaming’ protocol to be ‘cheated’ into giving up its content.
‘It is tightly integrated with the video decoder, and then immediately hands video over to the device screen,’ said Landwehr.
The Flash video is then played under the control of a secure script written in the playlist W3C XML markup language Smile. If the script says play a pre-roll advert and then play the video, the player can’t show the video in any other order, and can’t drop the pre-roll ad and if it tries to, nothing will play.
Landwehr is confident that end users cannot gain access to the Smile code, so cannot strip the advert out.
‘There is only so much you can do with content protection, because someone can always point a camera at the screen, play the video, and make a copy, but we try never to let anything be ‘seen’ by the operating software, and keep it all hidden inside the player, to make it as tough to break as possible.’
This set up is clearly aimed at addressable advertising systems, so that each viewers’ system can call a local or remote advert, which might be different from anyone else watching the same system.
The same protection goes for other types of advertising including overlay adverts and the banners that sit directly above the video playing area on the screen. Banners, like overlays can be timed to play at a particular moment in the video, change at certain intervals and repeat. The aim is that trying to stop them means that the video stops playing. Also the viewer can be customized by the content owner using the brands of any sponsor, or their own brand. At present this is all handcrafted by the content owner when he sets his business model and revenue rules, ‘We do not yet have a GUI for creative people to manage this,’ admits Landwehr, ‘but of course it will come.’
Some advertising management systems which do this, such as those offered by US start up Maven Networks recently, are already on the market, which doesn’t seem to worry Adobe. It has to stay focused on the basic technology and its adoption first and foremost.
Broadcast networks already use overlay advertising, but mostly to advertise their own programming, rather than jeopardize their existing ‘interruptive’ video advertising revenue streams. On the internet it is expected that these will be ‘interactive’ and that content owners will set rules whereby if a viewer clicks on them, the video pauses while an interactive advertising journey is completed to perhaps further ad content or a registration process and then the video stream starts up once again.
‘We’re shipping all of this in the first quarter,’ declares Landwehr, ‘but it can be downloaded now on pre-release beta. Shortly it will come with H.264 support and support for HD.’ Landwehr says that video that would need to stream at 6 Mbps will be supported as either streams of files in the Media Player and will support full screen views.
But what about the handset? The holy grail here is getting the same video format to work on the handset and the PC. That’s where Microsoft is trying to get, and its recent deal with Nokia, whereby the handset maker will offer all of its own Ovi portal content in Windows formats, using PlayReady DRM shows a genuine breakthrough. Nokia has not said that it will support Silverlight yet, but it’s bound to, and the combination of Silverlight and PlayReady (once complete) will be very similar to Adobe’s DRMed Flash Video.
‘Flash Lite is already on 300 million handsets,’ reminds Landwehr, ‘and in version 3.1, which was released a few weeks ago, we began supporting Flash Video streaming.’ So less than 1% of those 300 million can support video as yet, but that number will change rapidly given that most handsets cycle every two to three years.
‘Our vision is very different from Microsoft’s in that we expect it on the handset, on consumer electronic devices such as cameras, and on PCs and set tops. The goal is to have the DRM built into the player, and multiple sources of video to work with all of them. We will not sell our DRM separately as Microsoft has done. We want the user experience to be more like using a DVD player. The consumer doesn’t even know that CSS (content scrambling system) is there, they just play a DVD.
‘The Apple iPod hides the DRM quite well, but it is locked to the device. We will play on any device, including Macs and Linux boxes,’ Landwehr added.
But isn’t this what Microsoft is now doing in the creation of PlayReady that will play on Microsoft devices, but also Symbian and Linux handsets?
‘Microsoft first had Windows Media DRM, then it had PlayForSure, then Zune DRM, now PlayReady. You’ll have to ask Microsoft what it’s strategy is?’
But the truth is that Microsoft has been pilloried for bundling its media player into its operating system by the European Union, which made it separate them once again, and also for bundling DRM into the player. What Microsoft has never done so far is allow the generalized porting of its Media Player to other platforms, but we think it is in the process of letting that happen now.
There is a huge difference in legal anti-trust terms in the consumer receiving a media player and DRM free of charge from Nokia (which will have had to pay Microsoft for the privilege) than getting it bundled for free but limited to a Microsoft operating system. This is perhaps the reason why despite its dominance in internet video right now, Adobe won’t be getting a knock on its door anytime soon from the European Commission, because although it is bundling its DRM with its Media Player, and making it free, it is not using it to support another platform layer below that.
Just how long it will take for a full media player, and the same download to own options to be made available on a handset is difficult to say. There are some non trivial issues with the H.264 codec on a handset, and only the basic profile can be used in encoding, so that no processor intensive activities are incurred, reducing battery life. Adobe’s codec partner (On2 Technologies) will have to get to grips with that before longer programming can be sent a handset.
‘But the new Flash Lite version that plays video already works on a Nokia handset,’ points out Landwehr, and the implication is clear, that Nokia may have chosen one partner for its own portal’s DRM, but it is not in the business of stopping other portals that use Flash from watching their video on handsets it produces. Which raises the prospects of every handset eventually supporting as many codecs as it has radios (often between 5 and 7).
‘Our roadmap for the handset includes download through 3G and Wi-Fi, as well as sideloading through the PC,’ confirms Landwehr. ‘We’re thinking about that stuff right now, even if I can’t give you timeframes of when it all comes together.’
The war for IP video on the handset is in its infancy and it promises to get as complicated, and ultimately as messy, as the fight for video on the PC was, which of course still isn’t over.