Analyst Mark Kirstein's point of view is that watermarking and fingerprinting are important developments in enabling DRM to achieve its potential for enabling content marketing and monetization.  As such, he views them as complementary to encryption-based "classic" DRM approaches.  He agrees with many other industry observers and technology vendors in viewing watermarking and fingerprinting as complementary to each other as well. 

The report suggests that watermarking, because it requires proactive steps on the part of content owners (i.e., watermark insertion), will take longer to achieve momentum in the market beyond its main existing uses in pre-release content, broadcast monitoring, and association of music with metadata.  It cites several applications that are expected to take off in the future.  Monitoring of user-generated content sites and P2P networks is next up on the horizon (for video; these applications are already more established for music), followed by transactional watermarking for early-release-window HD video content.  Further into the future are content monetization applications based on targeted advertising and other models.

The report looks into how watermarking and fingerprinting will complement existing conditional access technologies for video delivery.  It contains characterizations and descriptions of many of the key players in content identification technologies today. 

What's a sure sign that a new technology is poised to take off?  The appearance of a market research study solely on that technology, complete with revenue projections.  The problem with studies like this in the DRM market is that revenue projections tend to be based on input from vendors but not from customers, which often results in overly optimistic projetions.  The "customers" for the technology, content owners, aren't the ones who are paying, and revenues from these technologies tend to be based on indirect models or are highly confidential, as is the case with many patent licensing deals. 

This new study has the same unavoidable shortcomings in methodology, though the analyst's use of IP licensing models as the primary revenue model is clever and safer than attempting to create models based on software licensing.  Yet the nature of studies like this leads to what one might call a "Heisenberg effect" on the market -- i.e., the mere fact of the study's existence affects market growth.  Vendors of content identification technologies and services that intend to take advantage of them will purchase this report and use it to attract investment; this in turn will lead to market activity and thence growth... at least for the next 12-18 months or so.

At the same time, we concur with the main conclusions of this report -- that watermarking and fingerprinting technologies are poised for dramatic growth, are complementary, and could fulfill the potential of digital rights technologies for monetizing digital content. 

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