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DRM Spending to Exceed $1B Annually

15 Mar, 2007 By: Jessica Wolf

Content holders and distributors will spend more than $9 billion over the next five years on digital rights management (DRM) hardware and software, according to a new report from Insight Research.

By the end of this year, total worldwide spending on DRM will hit slightly more than $1 billion, and by 2012, business spending is forecasted to grow to nearly $1.9 billion, according to the study.

As digital delivery becomes more prevalent, DRM options to manage the consumer's interaction with, and prevent widespread illegal copying and distribution of that digital content becomes more important.

The study focuses on the use of DRM by wireline retail users, wireless retail users, TV and home entertainment network (HEN) users, software application retail users, as well as software application corporate users.

The report notes that as the value of digital content increases, applications of DRM will increase, though at a slower rate than the value of content based on the fact that DRM pricing is not tied to the value of the protected content.

The DRM industry right now is focused more on protecting the rights of the content than it is usage needs and expectations of the consumer, according to the report.

“DRM evolved over the last two decades to serve corporations that needed a means to deal with information piracy, peer-to-peer file sharing, and various regulatory requirements,” said Robert Rosenberg, president of Insight. “So in a sense DRM did not arise to meet the needs of end users, and in fact, it may be said to have evolved to spite the end user.”

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