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Technology Stocks : Diamond Multimedia

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To: Jonathan Quick who wrote (3751)10/21/1998 8:24:00 AM
From: Scott Garee  Read Replies (1) of 4679
 
Jonathan,

I started to post this, then decided to find out on my own, then changed my mind again and decided to be lazy and make you do the work. :)

Can you give the short-n-skinny on SCMS? Is it not a media encoded device? How would it apply to mp3 data? Since mp3 provides no means for encoding it, Rio could not exist with SCMS. Or am I all wet?

I've had some good discussions with other investors and technology people trying to guess how this will come out. It definitely is not clear to me.

o Personal computers are clearly exempted by AHRA. Rio cannot function without a PC.

o There is no non-audio output from Rio, so it isn't likely to be construed a recording device. A recording device is one which takes output from one media and creates a new media which can be redistributed. Rio is a playback only device, just like a cassette player. The only difference is Rio's media is a digital data stream, where a cassette player's is a physical cartridge.

o Rio does not, in itself, enable piracy. My ability to own Rio should in no way be a defense of any decision of mine to conduct audio piracy, any more than my ownership of a PC would be a defense of software piracy. This, of course, assumes Rio does not ship with a ripper.

o A decision to eliminate Rio would deny consumers, like me, who have a large audio colletion the right to own a device like Rio which would further enable them to enjoy that collection. Your definition of SCMS would help me better understand this issue.

Of course, all of this is subject to the court's interpretation, so the lawyers had better be able to explain these points clearly.
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