Picking the Lock

Rich media applications such as music downloads and video clips are gaining value and becoming a higher priority for the Middle East's cellular operators. But rights associated with those services are also becoming increasingly hard to protect.

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By  Richard Agnew Published  November 28, 2004

|~|mobiles1.gif|~||~|The last few years have seen media companies and service providers punished for inaction on the web, with unauthorised channels such as Kazaa and Napster cannily profiting from low availability of legitimate multimedia services such as music downloads. With value added services (VAS) now starting to generate more revenues on cellular networks, mobile operators and content providers are therefore keen to get to grips with the same problem early. Piracy of mobile multimedia services also seems to be on the rise in the region already, giving providers another reason to prioritise the delivery of legitimate services, protected through digital rights management (DRM). DRM is not a new development in itself, having first been introduced by Nokia in a simple format to protect basic VAS in 1996. But with GPRS and 3G uptake and service development in the Middle East still in its infancy, the issue is only really now starting to rear its head. “DRM is still to be addressed by the industry as a whole, and in this region, we’re still lagging,” says Andrei Torriani, chief product development and technology officer of Kuwait-based mobile operator, Wataniya. “The prevalent content providers in the region have still not evolved their DRM systems to the same level as those in the West. There is also the problem of deciding which DRM standard to go for, and the fact that they’re not all compatible,” he adds. With mobile service providers and operators starting to ink deals with regional and international media outlets to distribute their content, however, protecting their rights to it is set to move up the agenda. Early VAS have been adequately served by simple DRM systems. But as premium services such as music downloads and games are launched, the number of players that have an interest in content increases, making this task much more complex. “The ringtones, logos and personalisation services that we have seen so far form the foundation of the mobile content business, but their value is very low,” says Sissel Henriette Larsen, marketing director of DRM supplier, Beep Science. “The concern for providers of these services arises when they start to assimilate brands into their content and move backwards in the value chain. They then need to secure the rights that they have been given,” she adds. This increase in complexity is perhaps best demonstrated by the evolution of mobile music services from polyphonic ringtones into actual tracks, the usage of which then has to be reported offline by a service provider to the original rights holder. “Ringtones are not the real tunes, so existing providers don’t source them from labels and royalties don’t go back to the label or performing artist,” says Larsen. “But with music downloading, this is the real stuff, so composers, labels, performers and who they are represented by come into the picture. These are high-value digital assets that need to be protected, so DRM becomes much more important. The value chain also becomes very complex,” she adds. At the other end of the value chain, content producers are also looking for mechanisms that could encourage users to become participants themselves, by allowing them to ‘super-distribute’ the content they have bought — either as part of an MMS-based promotional campaign or to increase the addressable market for premium content, for example. But to disable free distribution of purchased content, many providers and operators still use forward locking, so that one purchase only generates a single transaction. “Protecting content with forwarding-lock mechanisms is not a viable solution,” says Larsen. “These services are all about providing content that people want to share, either through MMS or other mechanisms like Bluetooth, infrared, or transfers from PCs to phones. So, if forward-locking is introduced, the provider will exclude itself from the significant revenue opportunities of peer-to-peer premium-rate message distribution, as well as limit the service’s user friendliness,” she adds. Heavily tied into the super distribution challenge is also the need to create standardisation between devices and different multimedia services, which would allow users to port content if they upgrade their devices or send it onto friends that don’t have a compatible handset. Considerable effort is therefore being put into interoperability and super-distribution by the industry body, the Open Mobile Alliance (OMA). It came out with its second DRM standard this year, which has improved sharing between end-users from its previous system, which forced recipients of super-distributed content to contact the retailer to preview or purchase it. A ‘domain model’ in the 2.0 standard also allows one licencee to access content on different devices, or for services to be distributed to specific groups by an operator or media company. In addition, the system should allow greater inter-working between the handsets of several manufacturers that are members of the group, once a wider range of enabled devices are launched. “We’re hoping some standardisation takes place in the industry — if not we’re going to have to take some hard choices about what we can offer,” says Torriani. Further work will also be needed to allow inter-working between systems based on OMA 2.0 and the various proprietary DRM technologies that are currently available in the market. “We don’t necessarily believe that there’s going to be one, über-standard,” says Chris Parkerson, DRM evangelist at RSA Security. “But there has to be inter-working between the different technologies. If they pay for content, consumers want to own it for however long they want. Not giving them portability of that content as they upgrade or change their devices will be a quick way to stunt the growth of the market,” he adds. If users are also to play a role in content distribution, their rights when downloading services will also have to be presented to them as simply as possible. Currently, the Mobile Entertainment Forum (MEF) has established an initiative to create best practices when it comes to the development of user interfaces. “Transparency is one of the key issues,” says Larsen. “It’s a challenge, because it’s often engineers that are creating the systems and they understand technology a lot better than end-users. I see good deployments out there and some that could have been better. This is an area where the industry needs to get together so that barriers aren’t created for end-users,” she adds. Despite the advances that have been made, there are also various non-technical challenges that are affecting the ability of mobile service providers and content producers to offer and keep hold of their intellectual property (IP). One such issue is the difficulty service providers face in securing clearance from media companies to use their content and protect themselves from litigation later on. This is particularly the case in the music industry where IP is shared between many different parties. “My honest opinion is that it’s not the technology that’s holding things up,” says Parkerson. “The entertainment industry loves to use DRM as an excuse, but copyright and licensing issues are the biggest stumbling block. Decent DRM technology has been around for a while and technology issues will work themselves out. But now, just to get a ringtone licenced in the US, you often have to negotiate with six different entities separately, and each one could shoot you down later,” he adds. In the region, this situation is heightened by the absence of collecting societies that would re-distribute royalties from content downloads and lead to a clearer licensing framework for service providers. “With the customer demand in place, the key is to make the licensing of content a sufficiently straightforward process for implementation on the mass scale required for mobile downloads,” says Rob Deans, a copyright lawyer at Clyde & Co’s Dubai office. “This can only be realistically achieved through collecting societies. While work has started on the development of collecting societies in the Middle East, there is still a fair way to go to enable the efficient licensing of mobile content,” he adds. Local providers, meanwhile, also complain that piracy is already growing of the mobile content they do manage to license, while little is happening to protect their investments legally. “The content on our website, IVR and SMS platforms is being pirated or [subjected to piracy] attempts on a daily basis,” claims Ammar Sharaf, chief executive officer of Abu Dhabi-based content aggregator, Mobile Telecoms Group (MTG). “That jeopardises some of the investments we have made and new ones that we believe the market needs. We have sent warning letters to those that have pirated our content but we do not have much leverage to pursue legal action, so we’re lobbying the UAE Ministry of Information to try to put more regulations in place and enforce the law,” he adds. According to Barakat, the situation is also already effecting the multimedia market as a whole. “We have conducted a market research exercise with customers and there’s a fairly large percentage that have converted [their opinion of mobile services] from positive to negative. The first two weeks of Ramadan — a high season for premium rate services — has witnessed quite a drop in the UAE, and I can only attribute this to a lack of interest or a lack of confidence in services,” he adds. Observers also point to the difficulty of getting government authorities to recognise the need to enforce copyright in such a new area of the economy. “The laws in place in the Middle East are generally adequate, in that they provide a basic technical framework for taking action against pirates,” says Deans. “The bigger issue is the practical enforcement of these rights, which requires a real buy-in from all interested parties — the content owners, the service providers and the enforcement authorities. Only by obtaining this buy-in... can the pirating of mobile content be brought down to manageable levels,” he adds. Nevertheless, while many of the legal issues remain out of service providers’ hands, at least the technology is becoming available to help them to make trusted content available and avoid the pitfalls that their counterparts fell into on the web. “If authorised, quality content isn’t provided, unauthorised channels will continue to grow,” says Larsen. “It will be a repetition of what happened on the internet, when the industry wasn’t pro-active. Mobile music downloads, for example, are high value assets for rights holders and demand protection, so it’s up to the companies living off the premium market to see their responsibilities and discourage end users from accessing black market channels,” she adds.||**||

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