Video Industry Needs to Migrate Digital Rights Management Towards Content Monetization

SCOTTSDALE, Ariz., July 7, 2009 - Copy protection, watermarks, digital fingerprinting, and conditional access are all Digital Rights Management (DRM) technologies used to enforce copyright protection of video content, reports In-Stat http://www.in-stat.com. Yet, efforts to stop the 12 billion illegal peer-to-peer (P2P) downloads occurring annually in the US have come up short. In-Stat believes content owners and service providers need to shift from content protection to a two-pronged content monetization strategy consisting of digital rights information management and offering a better user experience than illegal P2P services.

“What is needed is a new approach to monetizing digital content including moving a relatively small group of consumer households that do the bulk of P2P downloading (power users), to legal services,” says Keith Nissen, In-Stat analyst. “The question is whether the video industry wishes to control its own destiny, or get crushed by technological change, similar to what is occurring in the music business.”

Recent research by In-Stat found the following:

US broadband households download 14 billion videos each year; 85% are illegal.
In-Stat sees watermarking becoming a growing technology to track licensed usage rights.
A migration of power user households from P2P to legal video services would generate $1.4 billion in subscription revenue and $1.1 billion in advertising revenue.
Recent In-Stat research, Adopting Digital Rights Information Management (#IN0904399CM), covers digital rights management and peer-to-peer networking. It includes:

Analysis of multiple digital rights management technologies, including content protection, conditional access, fingerprinting, watermarking, and rights lockers.
Analysis of legal remedies and consumer usage expectations of legal download services.
Explanation of broadband power users and their impact on downloading of media content including the revenue potential if they migrate to legal download services.
Discussion of a shift to a content monetization strategy.
For more information on this research or to purchase it online, please visit: http://www.instat.com/catalog/mmcatalogu... or contact a sales representative: http://www.instat.com/sales.asp
The price is $3,495 (US).

This research is part of In-Stat’s Consumer Media & Content service. “Content is King,” but consumers clearly have preferences about the value of content and services, as well as what devices they use. Technology advances in digital rights management (DRM), internet TV, and cross media programming offer content producers’ new channels for distribution, but pose major disruptions to existing pay TV and mobile service provider business models. Consumer Media & Content (CMC) provides critical insights into how cutting edge technology, combined with new content delivery methods and consumer preferences, will influence the market for digital entertainment.

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