As multimedia mobile phones which handle downloadable music (and video content) are beginning to take over the current generation, one thing the mobile phone industry decided to agree on was a DRM standard to satisfy the entertainment industry. The DRM specification had been agreed last July, but it is not until now that a royalty scheme had been agreed on, which took under 4 months to complete with the help of the MPEG LA.
For each device, the royalty is $1 to implement Open Media Alliance (OMA) DRM 1.0 or 2.0. Each transaction (such as a song download) costs a further 1 cent royalty. The royalties are then split among the patent holders Sony, Philips, ContentGuard, Intertrust and Matsushita.
Normally handset manufacturers are very reluctant to pay for additional essential software, particularly costing over a few cents since there is a lot of pressure from mobile phone operators to keep handset pricing down. GristyMcFisty submitted the following news via our news submit:
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The secretive Open Mobile Alliance, which represents 200 industry heavyweights, actually agreed its first-generation DRM specification back in July last year, and has sketched out its successor, but the royalty schedule had not been agreed. Now the MPEG LA, a clearing house for technology patents including Firewire and MPEG family of protocols, has brought the IP holders together to agree how much it will cost manufacturers. To implement OMA DRM 1.0 or 2.0 the manufacturer will pay $1 per device, and the carrier, or service provider, one per cent of the transaction. The money will be divvied out between patent holders ContentGuard, Intertrust, Matsushita, Philips and Sony. Agreement has been rapid, taking less than four months. But it's nevertheless a considerable burden to cost-sensitive manufacturers, which often balk at paying more than a few cents for essential software. Handset vendors only pay around $5 to license the air interface. The costs will indirectly be born by the consumers, who as always in a lock-down regime, end up paying more for less. |
As the mobile phone market is quite huge such as in the UK where even ringtones are outselling CD singles by double, these DRM royalties will quickly add up giving the patent holders a fair amount of extra income. As mobile phone customers have been spending quite a lot on ringtones even back when ringtones were monophonic (one note at a time), music downloads are likely to take off just as well.
Unfortunately for the customer the DRM implementation means forking out for a mandatory feature that actually makes the customer worse off, for example the DRM measure will likely limit the customer's ability to transfer music to their PC let alone to CD or other portable devices.
Adding digital audio player features to mobile phones does have one major drawback in that once the battery runs down, not only does the listener get left in silence but also without the ability to make or receive calls and texts. Then again mobile phone manufactuers will likely implement a hanset feature to prevent multimedia playback when the battery is below a certain level.
Source: The Register
