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Technology Stocks : e.Digital Corporation(EDIG) - Embedded Digital Technology -- Ignore unavailable to you. Want to Upgrade?

To: mark cox who wrote (7372)	8/20/1999 10:26:00 AM
From: JimC1997	Read Replies (1) \| Respond to of 18366

Mark, You are correct. There is some confusion here between the concept of a security system which would be used to make the music unplayable on other than SDMI-approved devices and a watermarking system which will be used to trace the product after distribution. If the security system is defeated and the music is recompressed into an unsecure format such as MP3, the watermarking remains intact. There were several stories about Aris in which they described tests which they performed to insure that the watermarking would survive repeated generations of analog playback/recording. This is the key for the music labels, because it enables them to trace the source of blackmarket copies of protected music back to the responsible party. They can then take appropriate action against that person. Remember, the music labels have said that they will permit private use and copying of protected music, but want to avoid wide-scale distribution (through e-mail attachments, webpage downloading, etc.) The watermark embedded in the music will have an identifier for each level of transfer (i.e., the record label, any wholesaler involved, the retailer and (probably) end-consumer). Jim