IP: DVD mystery

[Dave Farber <farber@cis.upenn.edu>]

>From: "David R. Guenette" <guenette@mediaone.net>
>To: "Dave Farber" <farber@cis.upenn.edu>
>Cc: <rsolomon@dsl.cis.upenn.edu>
>Subject: DVD mystery
>Date: Wed, 5 Jan 2000 11:48:11 -0500
>
>First, as to the technical merits of the various arguments regarding DVD 
>copying methods, including how DVD-RAM and DVD-R/W work, a good starting 
>place is the following URL, to what is still informally known as Robert's 
>DVD Page: http://www.unik.no/~robert/hifi/dvd/. From this page one can 
>find references and links to many relevant publications, including EMedia 
>Professional, of which I am former editor, and articles by contributing 
>editors Hugh Bennett, Dana Parker, and Bob Starrett, all of whom 
>understand the technical issues as deeply as anyone, unless they've given 
>up the field and turned to goat farming since my last contact. Replication 
>News, a Miller Freeman monthly, is a trade magazine for the duplication 
>and replication industry and can be useful; EE Times, published by CMP, 
>offers the best, but only occasional coverage of the fundamental 
>technology of DVD.
>
>Nonetheless, I believe that the issue about DVD and piracy is a red 
>herring. Pirate labs have had a number of ways to duplicate DVD-Video, up 
>to and including taking an original disc apart and making a master for 
>stamping new ones from the pits and lands of the actual source disc; this 
>"copy" would contain identical information, down to the hidden keys, and 
>hence be perfectly playable. There are ways to do this digitally (find the 
>right hidden sectors, and replicate the entire bit-for-bit disc image) as well.
>
>I have long held (as do most others in the field) that the security 
>implementations imposed by the DVD Forum have little to do with foiling 
>large-scale piracy and everything to do with discouraging individual 
>copying. What the movie studios are most concerned with is that Mr. and 
>Mrs. John Q. Public will make a copy of a rented film, and therefore not 
>rent it again, or, indeed, purchase it. The solution, the DVD Forum 
>concluded, was to make copying difficult enough so that very few Mr. and 
>Mrs. John Q. Publics will do it, and that doesn't involve making it 
>impossible, but simply enough of a pain in the neck.
>
>The inclusion of Macrovision is one sign of this intent. DVD-Video itself, 
>in its limited access output of the CSS (content scrambling system) 
>circuitry, inhibits typical copying on PCs, since the signal is physically 
>restricted through the playback card, making it a hassle to connect, for 
>example, the DVD-Video signal within a PC to a hard drive.  And, of 
>course, if you don't record the key in your copy, you don't have a signal 
>that can be played on DVD-Video players. There are PC system workarounds, 
>but not many folk are likely to create custom cable taps, and then there 
>are the problems of needing to get into the sector and bit levels of the 
>disc structure, and not too many of us really enjoy hexadecimal editing. 
>Even as most recently seen by DeCSS, there are other ways to do it, but 
>the techniques are hardly ones the typical PC user will try, never mind 
>succeed using.
>
>But what about DVD-to-VHS copying? In my opinion, this is much more of a 
>home market threat, and the reason why Macrovision--a technology developed 
>to make VHS copying difficult (by adding types of signal noise and quality 
>reduction to the copy, if I understand the technology correctly). The 
>reason is that the studios don't want people to copy movies, whether it is 
>DVD-to-DVD (which is only now becoming possible, with the marketing of 
>DVD-RAM, and DVD-R drives, but still very expensive), or, more to the 
>point, DVD-to-VHS. Disney's outstanding reluctance (it was the last major 
>studio to sign up for DVD) is telling: after all, how many parents have 
>rented "The Little Mermaid" a half-dozen times, before buying a copy? I'd 
>guess we're talking about hundreds of thousands, at least, multiplied by 
>the X number of Disney films, and that is big money.
>
>The most interesting question is, perhaps, does Disney really have a 
>right, morally speaking, to this big money? After all, if the studio is 
>making a profit on theatrical releases, covering costs, paying its talent, 
>marketing, etc., and then making money on rentals, and film sales, as well 
>as covering bombs, just how much more should the public shell out for 
>repeated viewing? At what point does the citizen earn (buy) the right to 
>make or own a copy of the art itself, especially when the art form is 
>inherently duplicable, and, indeed, is a distributable medium?
>
>And when it comes to home copying? Price the darn titles low enough and 
>the studios would further expand their market, add profit, and reduce 
>illegal copying to inconsequential levels. After all, how many people want 
>to set up a dual disc drive/recorder configuration, buy the blank media, 
>and spend the time recording the stuff, when they can simply buy the 
>films, music, etc. they want to have, for a reasonable price.  There are, 
>of course, some really interesting digital rights management technologies 
>coming to market, and these represent another type of solution.  Please 
>note that I'm not against protecting intellectual property; I'm against 
>this protection being intrusive, clumsy, and too much in the interest of 
>intellectual property holders at the undue expense of citizens.  (Ask me 
>what I think about CEO and sports franchise salary/profit trends.)
>
>I think that the larger issue is the copyright issue, and the balance 
>between the public good (arguably, not having to pay $100 for repeated 
>rentals and purchase) and the property rights of the creators. The legal 
>pendulum has clearly swung in favor of the property holder, and the 
>corporate holder at that (200 years of copyright protection? Only 
>corporations have that kind of lifetime). I think that it is a very good 
>thing that the technology is well-positioned to return the situation to a 
>more reasonable balance in a de facto manner. By the way, when it comes to 
>large-scale pirating, there are existing legal enforcement mechanisms, and 
>while these are no doubt somewhat inefficient, watchdog organizations such 
>as SIIA, BSA, and the individual publishing companies themselves do have 
>protection. Basically, the studios don't want to have to make the effort 
>to protect their businesses from such threats, and are happy enough to 
>inconvenient consumers with such things as regional coding and copy 
>protection, in effect making everyone else do their work.
>
>The biggest problem may well be the greed of the studios (in the case of 
>music and film) and the consumer electronics companies behind the players. 
>Like CD, DVD represents both a great improvement of the reproduction and 
>playback art, plus a realizable reduction in cost of goods and 
>manufacture, both in terms of replicated discs and the players themselves. 
>Yet CD-Audio titles remain, typically, in the mid-teens in price, and 
>DVD-Video discs are as expensive or more expensive than VHS tapes, while 
>DVD-Video players are much more expensive than VHS players. The strange 
>thing about this is that DVD devices are cheaper and easier to manufacture 
>than VHS players and tapes, since they are more digital (ICs, benefiting 
>from the economics of silicon), and have no complicated transport 
>mechanisms, and leverage the research and development and manufacture 
>infrastructure of CD-Audio, a twenty-year-old, highly successful product. 
>The discs themselves hold many of the same advantages--well-established 
>manufacturing processes and facilities, inherently cheaper replication 
>process (no linear duplication requirements that VHS demand), and even 
>packaging, shipping, and handling is cheaper. But, wait, there's more! 
>Whenever a new medium comes to market, content holders get to re-sell 
>existing product in the new medium, usually at high margins, as music 
>studios have done with LPs, CDs, and now threatening to do with DVD-Audio, 
>while movie studios have moved from VHS to DVD.
>
>Unfortunately, the culture of the studios and electronics companies is to 
>want their money now, as much as possible, to overcome investment and risk 
>of development, manufacture, and marketing, and, in all likelihood, make 
>the next quarter and the stock price look as good as possible. The irony 
>is that their products are quite compelling and that they could be making 
>more money by selling much more product (further reducing costs per 
>product) at lower prices. DVD-Video could have been many-times more 
>successful in terms of installed base, market penetration, and resale of 
>already amortized content in the new media, if only these companies had 
>believed in their own marketing message. In short, they are greedy, fairly 
>stupid businessmen, who intentionally delayed the start of the DVD market 
>by at least one year, or two, if you also count the delay caused by the 
>jockeying for advantage in the format battle between the Philips/Sony axis 
>and the Toshiba/Time Warner axis. One or two years of missed market seems 
>like real money lost, but then, what do I know? I don't have an MBA.
>
>Ever read Frank Norris' The Octopus"? What the railroad was in the 
>mid-to-late 19 century, media (including telecommunications and 
>cable/satellite, etc.) is to late 20th-early 21rst century. I can only 
>hope that the relative lack of entry barrier, will help even the match 
>this time around. After all, it is much easier for electronic publishers 
>to do their thing than for would-be railroaders to build competing railroads!
>
>
>David R. Guenette, Editorial Director
>New Millennium Publishing (http://www.nmpub.com)
>18 1/2 Tremont Street, Cambridge, MA 02139
>617/868-6093 (voice/fax); guenette@mediaone.net