Universal vs. MySpace, Monitoring vs. Spying

You have to give credit to French media giants Vivendi. They know what revenue assurance is all about. Forget analysing lots of boring data and looking for exceptions to fix one at a time – if anybody tries any funny stuff, they better have some good lawyers. Vivendi demonstrated their innovative attitude to legal channels recently, when they used anti-racketeering legislation to take T-Mobile to court in the US as part of the fight for control of Poland’s PTC network. Now Vivendi subsidiary Universal Music Group is taking News Corp’s MySpace to court over copyright infringement – see the story here. The message is clear from Vivendi: their favourite song is “I fought the law and the law won”.

Vivendi owns content, and they want their fair share from everybody who sees or hears it. If you own intellectual property, then revenue assurance boils down to things like DRM and policing abuses. One of the funny things about this story is that this fight is between two subsidiaries of large international groups that cover both content and distribution. Vivendi has scaled back its distribution holdings over the years, but as well as claiming ownership of PTC it still holds the majority stake in French mobile operator SFR (much to the annoyance of minority investor Vodafone). And News Corp is a content business also; its Fox network was helping test MySpace’s improved copyright protection tool as announced earlier this week – see here. So both media groups have a vested interest in finding the right technical solutions for protecting copyright whilst enabling wider content distribution. But although MySpace had put in place enhanced tools to allow content owners to remove unauthorised content, the problem with that solution is obvious – it is classic reactive revenue assurance with the burden of the work being performed by the content owners. However, the timing of Vivendi’s action is strange. Maybe it was because of the pressure of a law suit, but MySpace had already acquired the technology for an active revenue assurance solution it could implement on behalf of content holders. In October MySpace had licensed from Gracenote (the on-line music database business familiar to any iPod users) the technology to automatically read the “fingerprint” of music uploaded to its site, and so to enable a check for whether copyrights were being infringed – see here for the press release from Gracenote. The intention to incorporate the “fingerprint” (the ability to identify a song from the first few seconds of music) within the Gracenote database was first announced as a co-operative deal with Phillips only back in the middle of 2005, so this is still pretty new technology. From that point of view, MySpace has moved very quickly to take the burden off content owners. But if you are Universal, seemingly not quickly enough.

Privacy enthusiasts may have noticed a worrying outcome from all of this. We all know that controlling content comes down to the ability to enforce. And that means monitoring who is doing what with content, and stopping the unlicensed copying and distribution. The pirates take advantage of the weaknesses in that ability. But so do ordinary people – in the sense that they do not expect to have their use of content, including casual copying and lending of material to friends, monitored just in case it represents a piracy threat. But now we are seeing the first emergence of a global on-line revenue assurance technology for content, premised on the idea that if you go on-line there will be an automatic check of whether you are entitled to have a copy of it. The automatic check against the Gracenote database already occurs seamlessly for iTunes users. At present, iTunes/Gracenote is not verifying if the content is obtained legitimately, because of the hangover from old technology. Nobody would have bought an iPod if they could not copy their CDs onto it, and last time I went to a music store nobody was taking a note of my name and address in order to issue a license to use the content I had purchased. But they could. And if Sony BMG’s antics are representative, they will. Remember that Sony BMG is the company that felt entitled to secretly install spyware on customer’s PCs as an anti-piracy measure. If the media companies tracked licensing at the point of purchase (easier to do on-line than at a store, but surely only a matter of time before they do both) and monitor copies on devices, they will have finally solved the problem of privacy for good. It would be the ultimate in revenue assurance for content. The only downside, depending on how you look at it, is that it also means that big business knows an awful lot about the private citizen – not just what they bought, but also where they store it and even if they copy it. So if you do not like that idea, you had better keep buying CD’s and paying in cash, and hope the music businesses do not phase out CD’s like they did with vinyl.

Eric Priezkalns
Eric Priezkalns
Eric is the Editor of Commsrisk. Look here for more about the history of Commsrisk and the role played by Eric.

Eric is also the Chief Executive of the Risk & Assurance Group (RAG), a global association of professionals working in risk management and business assurance for communications providers.

Previously Eric was Director of Risk Management for Qatar Telecom and he has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and other telcos. He was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.