In response to the popularity of online music and the growth of the MP3 (MPEG 1, Audio Layer 3) digital format, the Recording Industry Association of America, which represents major U.S. record labels, launched the Secure Digital Music Initiative (SDMI) in December.
SDMI consists of representatives from the music and technology industries and is charged with creating specifications for secure music downloads that ostensibly could be built into any download technology. SDMI expects to have those specs by March 2000.
SDMI also is working on specifications for portable devices that play back music downloaded from the Net, such as Diamond Multimedia's Rio MP3 device. Casting an eye toward the holiday gift season, SDMI has accelerated work on that project, aiming to have the specs by June 30 so they can be embedded in devices that will be sold this year.
To that end, a series of meetings have taken place, most recently earlier this month in London. During that meeting, a number of agreements were reached that seem to indicate a major attitude shift from the record industry in terms of how it can deal with the wide availability of unauthorized MP3 files online and how it can control the future distribution of copyright-protected music on the Net without alienating the music lovers who already have adopted MP3 as the de facto standard for online music downloads.
The challenge that faced the working group handling the portable devices was how to protect the music industry's interests without creating a spec that would block music outside the major labels' interests, such as MP3 files placed online by unsigned artists looking for inexpensive exposure.
Although the mainstream record industry has opposed MP3 because it has been used to pirate music, the format itself is legal--and the industry seems to be realizing that it is here to stay, at least for the moment.
The result of the May meeting is a two-part solution to add the group's specifications to software that resides on a user's hard drive or within the device and instructs the device what to accept, according to sources close to the group. During the first phase, the devices will remain largely unchanged, accepting any content in any format they are designed to play back, whether the content is legal or not, according to a music industry source who asked not to be named.
The difference will be a "trigger" to be embedded in new CDs that will remind the user via the device to upgrade to the phase-two technology once it becomes available, the source said. The upgrade will be a software fix, the source added, noting that the portable players in general are "dumb devices?most of the intelligence resides in software on the PC or in the device."
Phase two will involve what the music industry source--and another from the computer industry who also asked to remain anonymous--called "secure ripping." Users will still be able to "rip" CDs they own--that is, convert them to files that can be stored and played back from a computer--to listen to on their PC or portable device, but they won't be able to post the files on the Net, the sources said.
"What we're trying to avoid is a 'filling station' model, in which endless numbers of devices get fed from one CD," the music industry source said.
In addition, after users upgrade to the phase-two technology, they still will be able to play all the music they downloaded before the newer technology was available, whether legal or not, in any format including MP3, the sources said.
This represents a major change in the music industry's earlier stances; the industry until now has been notorious for its attempts to maintain a tight grip on its property at any cost. Although the record industry source said this move does not reflect a backing away from the fight against music piracy online and off, it does signal a shift in emphasis toward future business models.
It also answers criticism that has been leveled at the music industry by analysts as well as fans who gather on the Web, at sites such as the bulletin boards on the MP3.com music download and news site. All have taken the mainstream music industry to task for trying to fight the MP3 format through legal action rather than trying to create business models that allow for it.
However, the newer technology also would recognize recently pirated music and would not play it. For example, if a user downloaded an illegal copy of a song by the Dave Matthews Band before the phase-two technology was available, it would still play on the upgraded device. But if the user downloaded an illegal copy of music the band released after the technology was available, the upgraded device would recognize it as pirated and would not play it.
"If it has none of the new markings, then it will be allowed in," the music industry source said. "We're erring to the side of letting more in."
This move is designed to "incentivize the user to upgrade [to the phase-two technology] but not force him to," the music industry source said. "If he wants to be able to use the same device to play SDMI-compliant music in the future, he would have to upgrade.
"We're working to protect the future," the source added. "We've come to recognize that even with the most favorable intent of the technology industry to prevent piracy, there is only so much you can do to protect 'legacy' [or already-existing] content. So let's just go together in a way that we all can embrace and that consumers will embrace that will protect future content."