Digital Rights Management (DRM)

Company information

	Key points

• Content protection technologies and DRM systems are crucial for the development of new business models in the broadband market.
• In countries imposing copyright levies to compensate content owners for copies,, the lack of a fair transition model to DRM  is seriously hindering the deployment of innovative content services as companies such as HP are unnecessarily forced to direct their resources to accommodate a “double” tax system, severely impacting the street price of our products.
• HP is committed to three principles for DRM: 1) to preserve rich consumer experience while 2) building reasonable content protection solutions and 3) respecting intellectual property and copyright.
• Failure to define a common, workable approach will cause further delay in the deployment of new secure content online services and the new generation of consumer electronics and digital entertainment devices, impacting overall economic growth.

	The issue

HP's strength in digital media is based on its well-established expertise with the consumers, businesses and technologies that comprise the digital media distribution market.  From creation to consumption, HP has a history of success across digital movies, music, TV and photography.  As we enter an era in which all content is digital, mobile, virtual and personal, HP is committed to three primary principles to support digital rights management: to emphasize the consumer experience, to build reasonable content protection solutions, and to respect intellectual property and copyright.  HP will leverage its relationships with consumers, entertainment companies, technology partners, retailers, industry bodies and policy-makers to ensure a simple, affordable and enjoyable entertainment experience that is supported by a fair business model for content providers.

Below are HP’s overriding principles:

• HP is against stealing, period.
• We believe in copyright protection. 
• As a company that sells hundreds of products to end-users, we understand the consumer market.  Specifically, we know that consumers are in the driver’s seat on this and therefore their concerns play a key role.
• HP is also an innovator.  Innovation is critical to the future, so, in addition to being for copyright protection and for the consumer, we are also very much in favor of fostering, not stifling innovation.  Any judicial decision should not hinder the technology and content industries’ ability to innovate.  Innovation is critical to forward progress and continued success.

	Impact on HP

In Europe, the need to establish fair compensation to content providers has resulted in the imposition of levies on many digital products, while in the U.S. some copyright holders have called for legislation to impose technical mandates on digital products, which would require software, computers, and consumer electronics companies to include government-designed technology to prohibit unauthorized copying.

Below is a list of HP’s recent efforts in furthering digital rights management:

• In 2004 HP licensed Intel Corp.'s DRM design and co-developed a similar technology, launched in early 2005, with Royal Philips Electronics. Intel's high-bandwidth digital content protection (HDCP) technology is used for transmitting content to wired displays throughout the home.  The partnership with Philips provides protection for content recorded on DVD-Rs and other devices. 
• HP is a member of the Content Management Licensing Authority, whose recent initiatives have included rolling out a second-generation DRM device for protecting content in cell phones and other wireless-enabled devices.
• HP is a founding member of the Coral Consortium, dedicated to DRM interoperability to ensure that DRM solutions connect seamlessly and are invisible to the entertainment experience.
• HP collaborates with numerous standards bodies and industry organizations to further next generation technologies, such as the Advanced Access Copyright System.
• HP DVD Movie Writer is the first system in the industry to respect digital rights, informing the consumer only when content cannot be legally copied.
• HP allied with Apple on iTunes and iPod to deliver the best digital music experience possible
• HP solutions extend from creation and consumption to distribution - from the iPod to the HP Digital Entertainment System, HP plasma and LCD TVs, to the HP Digital Media Platform.

Source: BSA Global Software Piracy Study

	HP actions and outlook

The consumer experience is HP's number one priority in all digital media and digital rights management efforts.  HP incorporates DRM technologies as a means, not an end, integrating DRM to protect content, not to confine the consumer.

• HP DVD Movie Writer is the first system in the industry to respect digital rights, informing the consumer only when content cannot be legally copied.
• HP allied with Apple on iTunes and iPod to deliver the best digital music experience possible.

HP is an industry driver toward DRM solutions that balance technology, regulations and legal mechanisms.  This ensures the consumer's ability to easily enjoy entertainment on any device, in any format, while making new business models possible.

• HP developed VCPS with Philips, and licensed other industry leading DRM technologies.
• HP actively engaged the FCC to collaborate on issues such as the Broadcast Flag.
• HP collaborates with numerous standards bodies and industry organizations to further next generation technologies, such as the Advanced Access Copyright System.

HP is uniquely positioned to provide value and secure content solutions across the digital entertainment value chain - from consumers to artists to content providers.

• HP partnered with Starbucks in the development and launch of the Hear Music Media Bar.
• HP solutions extend from creation and consumption to distribution - from the iPod to the HP Digital Entertainment System, HP plasma and LCD TVs, to the HP Digital Media Platform.