DIGITAL RIGHTS MANAGEMENT WORKSHOP

In July, the Commece Department held a workshop entitled UNDERSTANDING BROADBAND DEMAND: DIGITAL RIGHTS MANAGEMENT WORKSHOP. The list of attendees and speakers is a who’s who of government and industry on the subject:
PHILLIP J. BOND Chief of Staff & Under Secretary Of Commerce for Technology
JAMES ROGAN Under Secretary for Intellectual Property
BRUCE P. MEHLMAN Assistant Secretary for Technolog Policy
ARDEN BEMENT Director, NIST
JOHN DUDAS Deputy Under Secretary for Intellectual Property
CHRIS S. ISRAEL Deputy Assistant Secretary for Technology Policy
TED COHEN EMI
DOUG COMER Intel
RHETT DAWSON ITIC
ELIZABETH FRAZEE AOL Time Warner
MITCH GLAZIER RIAA
GORDON LYON NIST
MICHAEL MIRON ContentGuard
ANDREW MOSS Microsoft
PRESTON PADDEN The Walt Disney Company
MICHAEL EPSTEIN Philips Electronics
JONATHAN POTTER DiMA
ROB REID Listen.com
BOB SCHWARTZ McDermott, Will and Emery
ANDY SETOS Fox Entertainment Group
TIM SHEEHY IBM
GRAHAM SPENCER digitalconsumer.org
JACK VALENTI Motion Picture Association of America
STEWART VERDERY Vivendi Universal.

A transcript of the proceedings can be found here:

MR. BOND: Let me begin by saying good afternoon to everybody, and thank you for coming out. My name is Phil Bond. I’m privileged and honored to serve as the Under Secretary for Technology here at the Department of Commerce, and also serve as the Chief of Staff to Secretary, Don Evans. I want to welcome you on behalf of the Commerce Department and the Technology Administration.

Welcome to our second Digital Content Roundtable, really the third event in this subject area that we’ve done in the Technology Administration. We also had a NIST Roundtable on DRM technical standards that we’ll be hearing more about.

Our first roundtable was exactly seven months ago, in December of last year, where we began to address digital rights management and the potential that further deployment of online content might have to stimulate demand for more broadband deployment.

Back then, I think it’s fair to say we heard nearly universal agreement that the private sector was aggressively addressing technical solutions. And we heard about marketing approaches that would help deliver high-quality and legitimate digital content to consumers.

Now, seven months later, we convene to look for a report from some of those participants on progress on the effort, and determine what appropriate steps might be taken next.

Specifically today, we hope to accomplish a handful of objectives, including to hear about the progress made in the technical standards processes. We heard about a great deal of activity in December, and we’ll attempt to create a status report this afternoon in that space.

Secondly, we seek to define the important perspective of consumers, and how the market is working to meet those expectations. Third, we want to hear about technological developments in business approaches that are shaping the market for online content. And finally, we hope to leave with a better understanding of the proper role for the government as a facilitator moving forward.

I think on behalf of my colleagues with the Department of Commerce, we certainly hope to hear of progress, but it is difficult in the current environment to be terribly positive. Piracy continues, and continues to impact the music industry, in particular, where sales have dropped this year by about 5 percent. We’re seeing jury trials in Los Angeles involving popular file-sharing services. Demand for broadband continues to be weaker than most of the public and the industry sectors would like to see.

The U.S. telecom sector, of course, is in full scale depression. We have headlines of continued IT layoffs, and less dramatically but importantly, users of LINUX still cannot legally buy DVDs and watch them on their computers, so it’s clear that we still face challenges. We will certainly hear divergent perspectives that are difficult to overcome and reconcile.

The environment that I think we all want to pursue, is one that will be supported with continued innovation, one that will provide a consistent, and reliable, and predictable level of legitimate copyright protection, and will, importantly, be responsive to consumers.

In my view, these objectives are equally important, and meeting them in the marketplace is, indeed, possible, but not easy. Visionary technology leaders have continually exceeded our wildest expectations, and indeed since seven months is a relatively long period in technology, we’ll look forward to hearing about technological developments even since December. And, of course, consumers’ influence has always been really the first and last voice in the marketplace.

While piracy remains a major problem, estimates are that about one-fifth of the U.S. population has downloaded music from file-sharing services. The market for the legitimate sale of content certainly seems to exist. One source has pegged that at about a 2.7 billion dollar market by the year 2007.

When the Technology Administration announced this workshop on July 3rd, we invited public comments on our website, and we’ve received close to 150 responses from individuals and groups since that point in time. And we have heard a number of very thoughtful comments. I think it’s a testament really to the Internet’s unprecedented ability to reach broadly to garner input and communication and to empower individuals.

I want to share with you one comment that we had, in part, because it summons up an interesting image, but also because of the point it makes. We’re reminded by one commentator that the Internet was created “by the military, crazed anarchists, visionary scientists, and engineers.” And while that is certainly an interesting imagine it speaks, I think, to the essence of the media, its innovative legacy, and the responsibility that we all share for its future.

I look forward to the discussion. I’m glad to see an overflow crowd. We are going to continue to take comments through the website, so we will look forward to everybody in the room having an opportunity, and even those not here to have an opportunity to comment….