Secure Digital Music Initiative

1
Secure Digital Music Initiative

• Creating
• a Digital Music
• Marketplace

2
What SDMI is

• A multi-industry forum to develop a voluntary
  open framework for playing, storing and
  distributing digital music to enable a new market
  to emerge.
• A forum for dialogue

3
Who has been involved?

• Broad multi-industry participation
• Over 120 companies and organizations -
  blue-chips, start-ups, record companies, Internet
  companies, software companies, consumer
  electronics companies ..

4
SDMI Participants

• 4C Entity
• Adaptec
• AEI Music/PlayMedia
• America Online
• Aris Technologies
• ATT
• Audible, Inc.
• Audio Explosion
• Audio Matrix
• Audio Soft
• Audiohighway.com
• Aureal Semiconductor

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SDMI Participants

• BMG Entertainment
• Bose
• Breaker Technology
• Canadian Audiotrack
• Casio
• CD World
• CDDB
• CDuctive.com
• Channelware
• Cinram International
• Compaq
• Comverse Info Systems

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SDMI Participants

• Creative Technologies
• Dentsu
• Deutsche Telekom
• Diamond Multimedia
• Digimarc
• Digital On-Demand
• Digital River
• Digital Theater Systems
• DIVX
• Dolby Laboratories
• EMI Recorded Music
• Encoding.com

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SDMI Participants

• Enso Audio Imaging
• Fraunhofer IIS
• General Instrument
• GoodNoise
• Hewlett Packard
• Hitachi
• HMV Group
• I2GO.COM
• IGUIDE
• Infineon
• InterTrust Technologies
• Intervu

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SDMI Participants

• IOMEGA
• J. River
• J VWeb
• Kent Ridge Digital Labs
• Lexar Media
• LG Electronics
• Liquid Audio
• Lucent Technologies
• M. Ken
• Macro Vision
• MAGEX at NatWest
• Matsushita

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SDMI Participants

• MCOS
• Memory
• Media Fair
• Mediamatics
• MCY Music World
• Micronas Semiconductors
• Microsoft
• Multimedia Archives Retrieval Systems
• MusicMarc
• Nippon Telegraphic Telephone
• Nokia UK
• NTT Mobile Communications Network

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SDMI Participants

• Packard Bell NEC
• Philips
• Pioneer
• Plug n Pay Technologies
• Portal Player
• Pricewaterhouse Coopers
• QDesign
• QPICT
• RealNetworks
• Rights Exchange
• RPK Security
• Saehan Information Systems

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SDMI Participants

• Sanyo North America
• Seca on behalf of Canal Plus
• Sharp
• Softlock Services
• Solana Technology Development
• Sonic Solutions
• Samsung Electronics
• SanDisk Corporation
• Sonopress (BMG Storage Media)
• Sony
• Sony Music Entertainment
• SpectraNet Communications - ThrottleBox

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SDMI Participants

• Sphere Multimedia Technologies
• STHilo, a subsidiary of Telefonica
• STMicroelectronics
• Sun Microsystems
• Supertracks
• TDK Electronics
• Telian
• Texas Instruments
• The Mitsubishi
• The Music Connection
• Thomson Consumer Electronics
• Tokyo Electron Device

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SDMI Participants

• Toshiba Corporation
• Touch Tunes Digital Jukebox
• Universal Music Group
• Victor Co. of Japan
• Warner Music Group
• Wave Systems
• Waveless Radio Consortium
• WavePhore
• Xerox
• Yamaha

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The Path to SDMI

• 1970s Tape recorders
• 1980s DAT
• 1990s
• CD-R CD-RW
• Recordable DVD
• Storage capacity
• Small, portable, removable hard drives
• Flash memory devices
• MP3 files

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Confrontation to Collaboration

• Legal rights difficult to enforce
• Need for technological solution
• Need for collaboration to allow a legitimate
  market to emerge

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Benefits of Collaboration

• New business models for music usage can develop
• New products and services can be created to
  support these new uses
• Consumers gain
• easier access
• to more music
• in new, more enjoyable ways

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Pirate markets benefit no one

• Piracy-based markets are short-term only
  consumer frustration hurts everyone
• If content loses value, technology driver is lost
• Lost opportunity for e-commerce

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Legitimate markets benefit everyone

• Easy access to music
• Easy to acquire
• Quality sound
• New ways to use music
• Interoperable devices

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Legitimate markets benefit everyone

• Companies that make products
• Artists who make music
• Consumers who want both

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Goals of SDMI

• To secure music in all forms, across all delivery
  channels
• Brand music with indelible markings, at the
  source
• Identifiers and usage rights data travel with
  music
• All devices read and act on data in predictable
  ways.

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SDMI is commercially motivated

• Not intended to reinvent
• Intended to build on what has already been
  achieved and what is already available in the
  market

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Short term need Portable Devices

• Customer demand
• Technology partners eager to join that market
• Internet could otherwise turn into a permanent
  haven for pirated music
• Therefore, portable device issue had to be
  addressed on a very fast track

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SDMI on concurrent tracks

• Short term needs requiring prompt resolution
  Portable devices on a fast track
• Long term objective Meta-level architecture

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SDMIs Launch

• February 26, 1999
• Executive Director - Leonardo Chiariglione
• Chair of MPEG
• Portable Device Working Group
• Immediately tasked with focusing on Portable
  Devices
• Jack Lacy, Chair
• Met June 30, 1998 deadline for initial Portable
  Device Specification

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Portable Device Specification Version 1.0

• Adopted June 28, 1999
• Released July 13, 1999, after technical review
• Publicly available, along with overview and FAQ,
  at www.sdmi.org

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SDMI- Framework, Not Format

• No intent to select a compression technology
  (MP3, AAC, MSAudio, etc).
• No intent to select an encryption technology.

• Reasons
• Technology is continually developing and will
  improve.
• Encourage innovation and competition.
• Allow maximum flexibility.
• Allow market to choose the best formats.

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PD Specification Covers

• Application
• Program that manages import of content, music
  libraries, playback and rights management
• Portable Device (PD)
• Device that stores protected content and plays it
  back
• Portable Media (PM)
• Media that stores protected content
• Licensed Compliant Module (LCM)
• Interfaces and/or translates communications
  between LCMs and PDs/PMs

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Core Principles

• SDMI components must respect any usage rules -
  which describe how the content can be used - that
  may come in the content in the future.
• Any artist, band or record label that chooses to
  permit unlimited copying will have that option.
• Any artist, band or record label that chooses to
  limit copying of an original will have that
  option.
• This is a general principle for future
  application (e.g. electronically distributed
  music), not current product.

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Core Principles

• Any content to be used in an SDMI Portable Device
  must be protected at all times after it has been
  imported into the SDMI domain.
• Subsequent storage, use within, or transfer
  between SDMI components must be done in a manner
  that protects the content.

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Core Principles

• Content must be bound to a Portable Device or
  Portable Media.
• This ensures that a copy on a PD or PM will not
  become the source for additional copies.
• This does not limit consumer usage because
  consumers can make copies for any device they
  choose - and as many devices as they need - and
  portable media can be transferred among
  compatible devices.

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Core Principles

• SDMI components will accept both protected and
  unprotected music, e.g. MP3 files.
• Unknown, unprotected music will be converted into
  SDMI content and stored in protected form.
• Music from unknown sources (garage bands, church
  choirs) will not be excluded.

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Core Principles

• Legacy content (music on existing CDs) will not
  be technologically protected.

• Reasons- Effective protection is not
  possible.- Technological impediments would
  merely be minor speed bumps to copying.-
  Necessary in order to permit church choirs and
  garage bands to use SDMI.- Respects privacy
  rights.

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Core Principles

• Future content (music on future CDs, DVD-A and
  EMD) must be protected against Internet piracy.
• Mechanism for protection yet to be determined.
• One way this could be done is through a Dual
  Watermark System.
• Robust watermark - will not degrade when
  compressed.
• Fragile watermark - will disappear when
  compressed.
• All music from unknown source passes through
  screen in SDMI application. Screen only permits
  in content that either has both marks or no marks.

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Core Principles

• Personal copying of CDs is permitted Internet
  distribution without authorization is prevented.
• Where usage rules are not found, SDMI
  components will only make 4 copies from every rip
  from the original. This allows personal
  copying - as much as necessary - but impedes
  piracy.

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Core Principles

• SDMI technology must be robust.
• Security mechanisms must achieve certain
  requirements.
• Tamper resistance in both software and hardware.
• Content must be protected whenever exposed.

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Implementation

• Devices to develop in 2 phases.
• 1st Phase
• Screen music for a signal - time to upgrade to
  become a 2nd Generation device.
• 2nd Phase
• Dual Watermark or other system
• Only upgraded phase 2 devices will play future
  releases.

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Compliance with the Standard

• Compliance is a condition of obtaining a
  trademark license to use an SDMI mark.
• Compliance is a condition of obtaining a
  technology license for the Aris/4C watermark.

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Marketing Efforts

• Logo and Tagline for SDMI Compliant products.

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Expectations

• Some manufacturers have already announced plans
  for SDMI compliant products, and they should
  begin coming to market by January, 2000.
• Goal and expectation is that SDMI compliant
  products will overtake non-compliant products
  within a few years.

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Announcements to Date

• Portable Devices
• Diamond, Creative, Matsushita (Panasonic),
  Toshiba, Mitsubishi, Lucent, Sanyo, Philips,
  Sony, Thomson (RCA), Audiovox
• Portable Media
• Texas Instruments, QDesign, Iomega, SanDisk,
  Matsushita, Toshiba

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Announcements to Date

• Software
• Microsoft, Intertrust, Reciprocal, WAVE,
  MusicMarc, Liquid Audio, Fraunhaufer, NatWest
• Content
• BMG, EMI, Sony, Universal, Warner, Rock.com

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Future of SDMI - Whats Next?

• Develop Functional Requirements
• Issue Call for Proposals for implementation
  technologies
• Develop specifications

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SDMI has already achieved goals

• Need for secure distribution accepted
• Provided forum for dealmaking
• Proved technology and content companies can work
  together
• Launched legitimate market for digital music

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Secure Digital Music Initiative