Interview: Microsoft talks about its new PlayReady DRM technology

At 3GSM this year, Microsoft launched PlayReady, its new ‘content access’ technology for mobile content, including music, video, games, ringtones and wallpapers. In essence, it’s extending Microsoft’s existing Windows Media DRM system to mobile, and expanding it beyond music and video.

I sat down with Microsoft’s Jim Alkove at 3GSM last week to find out more, starting with the basic overview.

What’s PlayReady about, in a nutshell?

Basically it’s a content access technology that supports different business models, like subscriptions, rentals, purchases, pay-per-view and preview, for a wide variety of content types well beyond music and video.

The technology will support an array of operator partners, including Bouygues Telecom, Telefonica, O2, Cingular and Verizon. And it’s available on a platform-agnostic basis, meaning it can be put in a wide range of devices, including operating systems other than Windows Mobile 6.

It will be available in the first half of this year for device implementations, and we expect we’ll start to see volumes of handsets coming through sometime in 2008. So that’s the high-level framing of what we’re announcing.

Tell me more about the thinking behind it

The technology is the result of a multi-year dialogue with the operators, including partners and mobile industry associations like the GSM Association. In a lot of ways they came to Microsoft to discuss how we could bring forth a suitable technology. Windows Media DRM has a long history since 1999, including being the first pioneers of the music subscription business. So PlayReady is the result of a long dialogue with the operators about how we bring that technology to the mobile market.

Windows Media DRM did move into the mobile space with various operators, such as [US operator] Verizon Wireless with VCAST. But PlayReady represents a marked step forward in the applicability of our technology to digital goods for mobile operators.

Today we think about music and video and games, but there are all kinds of interesting services operators would like to deploy to consumers. There’s enormous potential in the mobile entertainment space, and content access technology is a key enabler there, enabling operators to build differentiated offerings for consumers, and for consumers to have a wide variety of ways to access that content, whether they want to subscribe to it, or purchase it, or whatever.

What this really represents is bringing the mobile device centre-stage and allowing the consumer to do with their mobile all the things the previous ecosystem would have been able to do. Traditionally, portable devices are tethered accessories or peripherals to the PC. PlayReady brings those mobile devices out as first-class citizens, and enables it to participate directly with the services, for example subscriptions, without the PC.

Mobile seems the perfect medium for subscription music services, is it DRM issues that have held them back in the past?

Yeah, I think subscriptions are a very interesting business model, where there’s a critical need for content access technology. We prefer that term to DRM. Technically they’re the same thing, but content access technology really turns the lens around and focuses on the fact that what we’re doing is enabling interesting opportunities for consumers, and for operators to offer innovative services.

So for subscriptions, I think China Mobile has a ringtone subscription service where you pay a flat-rate fee, so rather than purchasing ringtones one at a time, you get access to unlimited ringtones for a flat monthly fee. That’s an example of a very interesting application of the subscription business model to something very popular like ringtones.

There’s numerous reports that mobile content isn’t growing as fast as the mobile industry expected. Do you think technologies like PlayReady will kickstart this again?

From our dialogue with mobile operators, especially in Europe, we see content access technology as a key enabler for these businesses. Mobile entertainment is continuing to grow though. The stalling you describe is more around music, where people are trying to figure out the right value proposition for consumers in the mobile music space. The reality is that things like mobile gaming are continuing to grow at a pretty good pace.

The operators are very focused on what they can deliver to the consumer in terms of mobile content offerings. Digital goods are equivalent – one copy of a digital good is the same as another copy, so if they want to offer a differentiated offering – purchase versus rental versus subscription – you need a content access technology. It’s about bundling, packaging and making compelling offerings…

Will PlayReady have a role in user-generated content? That seems to be building up some steam in mobile.

There are absolutely opportunities for content access technology in the user-generated space. That’s one of the benefits of PlayReady: we’ve added a degree of flexibility that allows us to partner with mobile operators and handset OEMs to build out new and exciting services over time, and have that fast pace of innovation that a commercial technology can really bring to bear.

Who’s going to explain what PlayReady is and how it works to mobile users?

From a marketing perspective, what you should be explaining to consumers is the service offer, rather than the underlying technology. Too often, the dialogue that happens in public around content access technologies or DRM is we tend to focus on the technology, rather than the service or offering it’s enabling.

So if I was a mobile operator, I’d be focusing my marketing on what I’m offering you – a music subscription service, or the ability to preview a casual game on your phone and then upgrade to a full version with one click to purchase. To consumers, the content access technology should be transparent.

For example, PlayReady allows a concept we call domains. If a user has multiple handsets, plus a PC and a laptop, and he wants the content to be seamlessly moved around those and be used at any locations, the domain feature we’re introducing enables content to be licensed to you, the user, as a group of devices, rather than individual devices as it is today.

A lot of content upgrade or migration scenarios today are problematic, and people often blame DRM for not enabling that. PlayReady will allow that content to move much more seamlessly along the devices that have been authorised by the service. That’s an offering decision that the operators will make, but PlayReady enables it.

How about sharing content with your friends’ mobiles. Zune’s been doing that in the MP3 player area, so will superdistribution be a factor in PlayReady?

Superdistribution is absolutely one of the business models we’re talking about for PlayReady, and at our 3GSM booth we’re demonstrating Bluetooth superdistribution on a couple of Nokia N90 handsets, which can send a music track from one to the other. It really brings home what PlayReady is enabling in terms of that P2P recommendation experience you’re talking about.

We think that’s a very powerful experience for consumers, and one reason we wanted to demonstrate it at the show is to prove that content access technology can enable interesting experiences for consumers, rather than what many people associate it with, which is stopping people from doing things they like to do.

So superdistribution is absolutely part of it, enabling consumers to recommend a song to a friend, and creating the subsequent business opportunity for the operator to enable the publisher to be compensated for that recommendation.

Is there a danger people will focus on PlayReady as a music-related technology, rather than the other mobile content forms?

It’s about providing the flexibility to provide new and interesting opportunities to consumers. We’ve talked already about user-generated content, and there are other new and interesting innovative services beyond music.

Content access technology has recently been pigeonholed into this music discussion, but the reality is it’s much broader. It’s really about enabling digital goods and commerce between consumers and operators in a way that’s very compelling, flexible and transparent to the greatest extent possible for consumers.

Last question then: what are some of the cooler non-music services you mentioned – what’s got most potential?

Mobile gaming is definitely one. PlayReady will enable protection of mobile games in a way that is quite flexible. Traditionally, when you talk about music content access technology, it’s about yes you can play this music, or no you can’t. With games, there’s a lot of interesting angles to how you would use the technology to make interesting offers to consumers.

For example, you might play the first level for a mobile game, but if you want to access higher levels, you’d have to purchase the game. Or you could license the game to the consumer for a number of total hours of playtime. So you could rent five hours of playtime, rather than a month, and you’ll see this timer ticking down as you play, so you know how long you’ve got until you need to top up your credit. That’s the kind of stuff it’s enabling in mobile games.

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