Google Acquires Widevine December 5, 2010Posted by Bill Rosenblatt in DRM, Video.
Less than a day after I pooh-poohed announcements made by Google’s general counsel about supposed steps the company is taking to enhance copyright enforcement over its services, Google announced a deal to acquire Widevine Technologies, one of the last remaining independent DRM vendors. The price was undisclosed, although Widevine has accrued investments well into the tens of millions of dollars from such companies as Samsung, Cisco, Liberty Global, and EchoStar.
I had known of other companies potentially interested in acquiring Widevine, but Google was never one of them. Yet there are at least three reasons why Google might be interested in owning Widevine. The most obvious, and the one cited by most other pundits, is Google’s need to implement DRM technology that will make Hollywood studios comfortable in licensing content to Google TV. Google TV has not had the warmest of critical receptions since its recent launch, so Google may be thinking that they can’t do without licensed “premium” content after all.
Acquiring a company seems like an overly elaborate way to obtain studio-approved DRM — and indeed, Widevine is on all of the major studios’ approved lists as well as that of the DECE/UltraViolet consortium. Google could have simply licensed Widevine’s technology, as many cable, satellite, and Internet video distributors have already done. Google does have a predilection for developing and owning technologies rather than licensing them from third parties. Yet Google is undoubtedly aware of the difficulties in getting studio approval for content protection technology that isn’t already on their approved lists. Therefore acquisition does seem to be a better alternative than licensing, at least from Google’s perspective.
The second possible reason for the deal has to do with Widevine’s strategic alignment with companies that could complement Google and improve its positioning against competitors in the emerging Internet video space, such as Apple, Amazon, Adobe, and Microsoft. Widevine’s DRM, unlike Apple’s FairPlay or Microsoft’s PlayReady, is supported on a very broad range of consumer devices, from handsets to set-top boxes to PCs. It’s also part of the CinemaNow/Best Buy ecosystem, which would give Google a retail presence to rival Apple’s.
Finally, Widevine offers adaptive streaming video technology that competes with similar technologies from Adobe (which Amazon uses), Apple, and Microsoft. This could be a useful piece of the puzzle for Android and Chrome OS, as well as for Google TV, since TV watchers are naturally less tolerant of “rebuffering” than, say, YouTube watchers. Furthermore, Widevine holds patents covering combinations of adaptive streaming and stream encryption.
In any case, when this deal closes, Google will be unequivocally in the DRM business. It will no longer be able to pretend that it isn’t, even though Google’s e-book technology includes a form of “DRM” by presenting e-books as hard-to-reproduce page images on web pages instead of downloadable files. Google will have to support Widevine’s existing customer base and possibly continue to sell the technology to various types of network operators.
Now that — unlike the relatively inconsequential pronouncements of Google’s GC last Thursday — is a seismic shift in Google’s attitude towards copyright protection and DRM.