Macrovision
announced yesterday that it is making its large patent portfolio for CD copy
protection available for licensing under the name VeriTOC. The patents
available under the VeriTOC license are primarily those that the company
obtained as part of its acquisitions of Midbar Tech and TTR in 2002.
The company claims that its patents cover a complete set of technologies for
protecting audio CDs without requiring extra hardware or software to be added to
consumers' CD players. Its press release even takes a swipe at the
company's arch competitor, SunnComm, whose MediaMax CD copy-protection
technology was circumventable by pressing the Shift key of a PC while inserting
a CD into the PC's drive.
Macrovision is certainly putting many of its eggs (other than those in its
enterprise software license management business) in the basket of copy
protection for physical media. As we noted
elsewhere
this week, its
strategy in DVD copy protection has the potential to be a significant innovation
and fills a real need in the market.
The CD market is another matter, however. We have always said that CD
copy protection is a ridiculous market, an act of locking the coop door after the
chickens have escaped (to extend the egg metaphor),
one that has already lead to a series of
egg-on-the-face (to extend it even further) embarrassments for technology
vendors and record labels alike. Macrovision continues to tout its CDS-300
CD copy protection technology, which incorporates Microsoft Windows Media Audio
as the format for encrypted "second session" files on CDs.
Yet the company's decision to market its patent portfolio is another matter,
and it's smart. We expect that the major record labels will persist in
trying to make CD copy protection work over the next few years, after which time
one of two things will happen first: the CD will decline as a popular format for
new music (perhaps being supplanted by digital downloads or streams), or
Microsoft will bake its own CD copy protection into its forthcoming "Longhorn"
operating system.
In either case, Macrovision can simply sit back and collect IP licensing
royalties while the various vendors compete, while staying out of the limelight
when the next technology gaffe is inevitably exposed. In the latter scenario,
Macrovision may even be able to garner royalties from Microsoft for every copy
of Longhorn that ships.
Events
IE 7
Firefox 2.0
