Wednesday, April 6, 2011

Over The Top Media Distribution

A few weeks ago I gave a presentation at OTTCon (the Over The Top Conference) in San Jose, California. What is "over the top"? The purest definition is multi-media (HD video, "television", and other media) delivered to your home through the internet. Over the top refers to working "around" the traditional "television" delivery channels to your home (broadband cable, airwave broadcast, and satellite).

The conference was over-subscribed and indicative of the tremendous foment in this technology, product and service area. As with any market with such dynamics and growth, the business opportunities are tremendous.

This market has large, well established vendors operating "walled garden" solutions with strong interest in expanding out from their now traditional music or DVD quality video distribution to high definition content. There are a large number of smaller niche players, and new entrants of varying types almost every day. Of course all the major consumer electronic brands and consumer media sales brands are jockeying for position as well.

The cable companies are highly involved, particularly as they strive for a larger business role than just as a bandwidth provider for "the last mile", which in turn has been and will continue to raise net neutrality issues.

There is tremendous product crossover, with gaming boxes serving as internet connected media access devices, smart phones and tablets operating as media access devices, set-top box functionality being integrated into traditional TV's and monitors, not to the mention the evolving role of the traditional PC as a multi-media hub.

There are platform wars erupting. The most interesting is Google's promotion of Android and Chrome as ubiquitous platforms to be used by all media oriented product vendors...which just happen to very easily integrate with Google's services and advertising.

Standardization is a major market force. Ultraviolet is an open standard in development with huge industry participation working to define and create a uniform and compatible system for purchasing, renting, accessing and viewing high definition video content on all owned Ultraviolet compatible devices.

Behind all of this are the studios, with their content and in particular with their high definition content, which they are being extremely careful with relative to distribution and monetization.

Overall, this is an incredibly complicated business and technology ecosystem, with participation by telcos, cable companies, satellite companies, consumer electronics companies, cell phone companies, microprocessor companies, computer companies, bricks and mortar and web only consumer sales companies, studios, and security companies. The corporate membership list of Ultraviolet, for example, is stunning in its breadth.

Michael Porter of the Stanford Business School is famous for (among other things) his promotion of a "force analysis" of industries. A comprehensive force analysis of the "over the top" market would be fascinating, revealing and extremely complex and rich.

I can't use the term "force" without bringing to mind the meme introduced into our social consciousness by George Lucas, "the Force". As we all know the Force has a light side and a dark side, and in this market area, the dark side centers around (no surprise!) digital media piracy.

Digital media piracy requires a legal basis for defining digital media as proprietary assets. This basis was all but non-existent only a few short years ago, as our large body of property law was primarily concerned with the physical plane. The Digital Millenium Copyright Act (DMCA) is now the foundation on which digital media as proprietary property rests.

Intellectually, most of us understand and agree that media in digitized form is still property. However, sadly, our moral structure and cultural attitudes have not kept pace with the advancement of technology. There are huge numbers of people who would not steal a pack of gum from a store who can and do routinely access pirated digital content.

Why is that? I believe there are two fundamental reasons. The first is the lack of perception of "theft", because there is no overt loss of goods to the owner when the piracy occurs. The second is what I call "second order access": if it's available for free or low cost download, then "I am not stealing it". This is analogous to buying the fancy new watch from the back trunk of someone's car; we know they stole it, yet we are tempted to make the purchase of the stolen goods.

Morality in a society is nurtured and supported by simple acts of peer pressure, and I urge readers to engage in this relative to digital piracy: do not allow this to occur in your home, refuse to support it by saying "no" to offers to enjoy "free" movies by friends and neighbors, and in general stand up at the critical times for the property rights of those who labored to create the content that has been stolen. All the technology in the world will not make us a moral society and protect our interests from ourselves. Only we as a society can do that, and it truly starts with each of us taking simple daily stands on the issue.

There is an incredible essay written in the early 1990's by John Barlow (who later became a co-founder of the Electronic Frontier Foundation) called "Selling Wine Without Bottles: The Economy of Mind on the Global Net". In this essay Barlow poses the following riddle: "if our property can be infinitely reproduced and instantaneously distributed all over the planet without cost, without our knowledge, without it's even leaving our possession, how can we protect it?", which in turn leads to a fascinating observation: "A lot of protection technologies will develop rapidly in the obsessive competition which has always existed between lock makers and lock breakers."

Here at Arxan Technologies, we are deeply involved in this "obsessive competition" in the arena of propriety digital content lock making and breaking. Consistent with the vastness of the ecosystem involved in "over the top" media distribution is an alarmingly complex delivery value chain for the actual content. This in turn presents a vast "attack surface" for those who wish to steal the digital assets in motion. And the problem doesn't stop with merely the protection of the digital content: other elements of the environment are subject to tampering to effect different forms of piracy. For example, tampering with a retail node to enable "purchases" without any actual financial transaction, or tampering with policy code to disable the time period restrictions on content.

We at Arxan are members of the Ultraviolet organization and are deeply involved in protecting digital assets in both Ultraviolet and many other "over the top" media distribution channels through Digital Rights Management software protections, key hiding technologies and node locking technologies.