Consumer electronics company Thomson has joined
Microsoft and Time Warner in trying to take control of US digital
rights management company ContentGuard Holdings.
Thomson's agreement to buy a 33% voting stake in the company
comes less than two weeks after the EU issued a formal set of
objections to Microsoft and Time Warner's proposal to take over
ContentGuard, citing monopoly concerns. Thomson's presence would
dilute the control of the other companies, perhaps easing the deal
toward completion.
According to Time Warner senior vice-president Ron Grant, the
new agreement is not aimed at appeasing the EU. Although the
companies hope the new deal will be approved, Grant said the point
of the revision was to open up more opportunities to accelerate the
development of digital rights management.
The EU has said it fears that Microsoft's strength as a software
provider, combined with Time Warner's broad media holdings, could
give the pair the incentive and ability to use their assets to put
digital rights management rivals at a disadvantage.
The entry of French company Thomson could dissolve these
concerns, and also brings another strong player to the table.
Thomson provides digital content services, such as DVD replication
and cinema post-production, and has expertise in intellectual
property licensing.
Digital rights management technologies are used to protect
digital content, such as movies and music, from unauthorised use.
As more content becomes available in digital form, the digital
rights management market has ballooned, enticing industry players
to get in on the act.
Thomson vice-president Joe Berchtold said that Thomson hoped to
drive a whole new host of business services for content owners.
While plans for the services were still nascent and separate from
the deal, Berchtold did not rule out future cooperation with
Microsoft and Time Warner given their strengths in the market.
The agreement is also aimed at driving interoperable
standards.
"We would like to see consumers have a choice of platforms to
secure their content," said Microsoft general manager Brad
Brunell.
Microsoft and Time Warner have purchased most of the stake held
by ContentGuard's original technology provider Xerox. The value of
their investments has not been disclosed.
Time Warner's Grant said that the companies respected the EU's
process and would cooperate with it.
Scarlet Pruitt writes for IDG News Service