As video content producers make that uneasy transition from top-down analog broadcasting to distributed online digital streaming, piracy has always been a top concern, although the jury is still out on whether the cons of digital freeloading outweigh the benefits of viral marketing that comes with video sharing. Either way, the situation gets far more complicated once advertising enters the equation.
Internet advertising generated $9.73 billion in 2006, and according to analyst firms such as TNS Media Intelligence and Parks Associates, by the end of this year 85% of that revenue will be from ads attached to video content. The problem is that the same digital technology that makes it easy for customers to rip digital video also makes it easy for them to dodge the ads as well.
Many DVRs already come with an ad-skipping feature. Alternatively, just Google the keywords 'video remove ads' to find all sorts of ways to detect and edit out ads from videos on your PC.
That's a major concern for content and service providers, says Brian Baker, CEO of video security company Widevine, because video ads are sold on a CPM (cost per thousand impressions) basis.
'If you're going to use that model, you have to be able to guarantee to the advertiser that the ad is going to be there,' Baker says. 'There's so much revenue tied into it, so you need technology to secure the ad in the content as a way to defend the CPM pricing model.'
The key to protecting 'advertising integrity' (i.e. keeping ads embedded in video content), says Baker, is a digital copy protection (DCP) component that detects the recording device that rips the video and takes action.
'Once the DCP technology detects this, it takes whatever action the content owner wants,' Baker says. Options include putting a warning sign on the screen telling the user to stop what they're doing, degrading the video quality to ensure an inferior copy, or attach an encryption key to the video.
The last option may prove to be the most interesting. While it doesn't prevent viewers from copying and redistributing videos, it does make sure that the ads get distributed along with them - and, more to the point, enables content providers to monitor when even pirated video is being viewed.
'You can still track it when it's consumed, because you can't watch the video unless it's decrypted,' Baker says. 'It asks our security platform for a key to decrypt first, and we send it and we keep a record of it.'
The ad integrity issue isn't limited to fixed-line pay-TV services - mobile TV will face similar issues, especially in a world where mobile devices are sporting greater memory capacity than ever, and where next-generation SD cards are capable of turning mobiles into DVRs.
According to the SD Card Association (SDA), by the end of this year 12 million Japanese mobile TV consumers will be recording programs using SD High-Capacity (SDHC) and SD memory cards. The SDA says it is working with mobile TV technologies like, DVB-H, DMB and MediaFLO to standardize DRM storage mechanisms for storing and transferring content between devices such as mobile phones, car navigation systems and portable DVD players.
'As mobile video becomes ad-driven, ad integrity is going to become an increasingly important issue for mobile TV,' Baker warns.