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Disney Prepares Rights Locker Initiative October 25, 2009

Posted by Bill Rosenblatt in Business models, Standards, Video.
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The Wall Street Journal has reported on Disney’s imminent announcement of an initiative with the internal name of Keychest — a proposed standard for interoperability of online video content.  Keychest is a so-called rights locker technology, in which users who purchase video content from one site in one format get rights to watch it on any compliant device they own.

If you have been following the industry or reading this blog (and its predecessor, DRM Watch) for a while, this will sound familiar to you.  In particular, it may sound a lot like the Distributed Entertainment Content Ecosystem (DECE), an initiative led by Mitch Singer of Sony Pictures with participants including Microsoft, Comcast, and the other major movie studios.

DECE was formally announced over a year ago, yet it has not announced much progress this year.  Both Keychest and DECE expect the full impacts of their efforts to be years away.

Just what Hollywood needs: another format war.

This time, the studios can’t pin the blame on consumer electronics companies, the usual suspects in format wars.  (Let’s remember Blu-ray (Sony Electronics) vs. HD DVD (Microsoft, Toshiba), and the one before that, VHS (Panasonic) vs. Betamax (Sony again).)  At the same time, although studios are leading these two initiatives, technology platform companies are firmly at their backs: Microsoft in the case of DECE and, lurking in the shadows not far behind Disney, Apple in the case of Keychest.

The main differences between DECE and Keychest are that DECE focuses on video download formats, while Keychest focuses on “cloud” services and streaming.  Keychest intends to be compatible with a range of streaming formats, codecs, and devices.  DECE started that way for downloading but switched tactics to include a standard DECE file format in its specifications.

In truth, several elements of streaming are easier to handle than downloading.  Keychest implementers won’t have to worry as much about DRM and may not have to worry at all about issues like on-device file storage, backups, and the authentication complexities around device ownership.  DECE has to deal with all of these issues.  On the other hand, streaming of video content at decent quality depends on fast broadband infrastructure that many people just don’t have, especially from mobile devices.

It’s theoretically possible for DECE and Keychest to join forces, because at a high level, their specs are more complementary than competitive.  And according to the Wall Street Journal article, Disney executives are taking the position that service providers and movie studios could participate in both.  Singer took a similar position in an article in today’s New York Times.

But let’s not kid ourselves: there was never much hope that Disney would participate in DECE; now Disney is going a step further by launching a competitive response.  This is really about platform technologies and about the question that is weighing on many Hollywood digital executives’ minds: will Apple do to them what it has done to the music companies?

Comments»

1. Bad Apple: Five Classic Apple Marketing Tactics That Lock You In - Miriness - November 4, 2009

[...] service. Or it could use its market power to push for one of the industry-wide DRM schemes proposed by Disney, Sony, and other parties. (Given the close ties between Steve Jobs and Disney, though, Apple might eventually endorse the [...]

2. PC World Philippines :: Features :: Bad Apple: five classic Apple marketing tactics that lock you in - November 4, 2009

[...] service. Or it could use its market power to push for one of the industry-wide DRM schemes proposed by Disney, Sony, and other parties. (Given the close ties between Steve Jobs and Disney, though, Apple might eventually endorse the [...]

3. Bad Apple: Five Classic Apple Marketing Tactics That Lock You In « Summved's another Web - November 4, 2009

[...] service. Or it could use its market power to push for one of the industry-wide DRM schemes proposed by Disney, Sony, and other parties. (Given the close ties between Steve Jobs and Disney, though, Apple might eventually endorse the [...]

4. Technology – Gadgets – Mobiles – Laptops – Iphone – Mobile Tools » Bad Apple: Five Classic Apple Marketing Tactics That Lock You In - November 4, 2009

[...] service. Or it could use its market power to push for one of the industry-wide DRM schemesproposed by Disney, Sony, and other parties. (Given the close ties between Steve Jobs and Disney, though, Apple might eventually endorse [...]

5. Nilda Larralde - February 18, 2010

How do free movie streaming sites make money ??? I would imagine that it would be hard to make income from free movie streaming sites !


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