Firms Agree on Digital Anti-Piracy Technology

Clearing a major obstacle to the delivery of digital movies and music into consumers’ homes, five giants of the computer and electronics industries have agreed on technology designed to protect Hollywood’s most valuable content from being illegally copied.

Intel Corp., Sony Corp. and three others are expected to announce today a joint proposal to deploy encryption technology that will help prevent people from making illicit copies of copyrighted digital content. The other companies behind the agreement are Matsushita Electric Industrial Co., Toshiba Corp. and Hitachi Ltd.

The deal could be a breakthrough for the entertainment industry, which has been wary of the ease with which digitally distributed material can be endlessly copied without any degradation in quality.

“If somebody tries to violate a copyright, it won’t work,” said Mike Aymar, vice president of consumer products at Intel. “The goal is that you’ll see products on the marketplace that support this by the end of the year.”

The agreement marks a promising new step in the often delicate dance between creators of content--such as movies, music and books--and new technologies, such as the Internet, that make it easier both to distribute their works and pirate them.

The proposed technology would have no effect on television sets, VCRs and computers already in people’s homes. But it would be an important component of newer, digital versions of those devices that could be arriving in stores later this year.

According to terms of the proposal, high-definition television sets, personal computers, digital video-disc players, digital VCRs, stereos and set-top boxes would all be equipped with technology that requires a digital “handshake” before a protected piece of work can be transferred from one device to another.

Further, it means that someone who buys movies or music over satellite services, cable networks or even the Internet would not be able to make copies--at least not high-quality digital ones--without permission.

The agreement was presented Wednesday in Burbank to the Copy Protection Technical Working Group, an ad-hoc committee that is led by major movie studios but also includes the music, computer, software and electronics industries.

Entertainment industry executives said they are evaluating the proposal and still have questions about it. But most expected it to gain broad approval.

Chris Cookson, executive vice president of Warner Bros., called it “one of the most important steps in making it possible to bring the highest quality digital pictures and sound to consumers.”

If it leads to more rapid delivery of new digital appliances and entertainment services, the proposal could be a boon to Hollywood, the computer and electronics industries, as well as consumers.

Executives and experts urged patience, mindful that efforts to erect new digital entertainment services over the last two decades have led to more failed promises than satisfied customers.

Still, the agreement comes just as the long-hyped notion of “convergence” between television and computing finally seems closer to reality.

The cable television industry recently ordered millions of set-top boxes with computer-like capabilities. And computer and electronics manufacturers are already building their devices so they can function in concert as part of an interconnected, household network.

Intel executives said Wednesday that the technology won’t be noticed by consumers unless they try to make an illegal copy only to get a message that the attempt was denied. The executives also said that the technology will accommodate various levels of protection.

Michael Moradzadeh, director of strategic planning for Intel’s consumer products group, outlined three possible scenarios: Consumers could still record ordinary television programs at will. Programming on premium pay channels, such as HBO, might be protected so that a single copy of a program could be made for later viewing. But the motion picture industry has made it clear, Intel officials said, that pay-per-view movies should be off limits.

Today’s proposal bridges a chasm in the ongoing migration from analog to digital transmissions by satellite, cable and traditional broadcasting outlets.

Until now, even programming that started out digital was always converted to analog for the final trip into the back of a TV set. But with new digital sets arriving, the transmission can be digital from end to end.

That raised fears in Hollywood, because if perfect digital copies can be passed from one device to another in the home, a movie or album could be transferred to a PC and duplicated endlessly.

The “handshaking” technology at the heart of today’s announcement is an encryption technique in which content is basically scrambled by one device and can’t be descrambled by another without the correct software key.

Computer and electronics executives envision consumers linking all their devices together using cables and a new standard interface with the clunky name IEEE 1394. Today’s announcement adds a layer of software to control what these devices can send to one another and sets ground rules for what can be done with copies that are sent.

Without such safeguards, entertainment executives said, they would be reluctant to deliver any of their most valuable content.

Such encryption technology has been around for years, but until now, there was not a consensus among leading electronics manufacturers to deploy a common specification so that all their devices would be able to work with one another.

In fact, Intel and Sony previously backed competing proposals before striking a compromise.

There are still two other proposals, including one from News Data Systems, part of Rupert Murdoch’s News Corp. empire. But entertainment executives said there are questions about those proposals and that it would be difficult to overcome the unified block of PC and electronics giants.

“It is more than reasonable that this one would become the standard,” said one Hollywood executive, who asked to remain anonymous. “If manufacturers are all deploying one standard, it makes it the one people use.”

Laws against copyright infringement are difficult to enforce in the enormous expanse of the Internet. Even with today’s announcement, experts said there still needs to be improvements in watermarking and other technologies to make it easier to detect and prove violations of copyright laws.

“There are still issues,” said David Stebbings, senior vice president of technology at the Recording Industry Assn. of America. “But it’s a great thing that companies with good ideas have gotten together.”