Six large technology and music companies have united to develop interoperable digital rights management systems to protect content such as music and movies.
HP, Sony, Philips, Matsushita, Samsung, InterTrust and Twentieth Century Fox have joined the Coral Consortium, which will seek to establish a framework - or, as the group describes it, a new technology layer - within the next nine months to allow consumers to play digital audio and video content regardless of the service provider or the device used.
But notably absent from the list of Coral members are three of the market's biggest players: Microsoft, RealNetworks and Apple, which produces the iPod and iTunes Music Store, the market's dominant digital music player and online music service.
Though establishing a group seeking interoperability is an important first step, compatibility between DRM systems is not going to happen any time soon, according to Mark Mulligan, senior analyst with Jupiter Research in London.
"What could Apple have to gain by making iPod and iTunes interoperable with other devices and content on the market? A symbiotic relationship is absolutely essential for Apple to sell its iPod device, which is very important to the company now. Selling and organising music through iTunes is more of a value-add for selling iPod," Mulligan said.
Apple's FairPlay system does not support the DRM technology used by other services like Microsoft's Windows Media Audio and RealNetworks' Helix.
In July, against Apple's wishes and amid threats of legal action, RealNetworks released the beta version of its Harmony technology to enable users to play tracks on 70 music player devices, including iPod.
"On the supply side, there is widespread enthusiasm for interoperability," Mulligan said. "But there is resistance from Microsoft.
"I can understand that Microsoft and Apple do not want to concede any ground. Apple is very strong in the market with iPod but they do run the risk of becoming a trendy niche player - much as Apple's operating system did against Windows and the PC - if they don't pick the right time to become more open. Something will have to move."
Mulligan believes that a big consumer backlash will come against technology and music companies as the consumption of digital content becomes more mainstream.
"Such a backlash could come as early as the beginning of next year, when people start to try to use iPods and other digital players they receive at Christmas as presents, only to realise, for the first time, the constraints that exist. For example, that a lot of the music and video they already have can't be played on their new devices," he said.
The fact that Sony has joined Coral is a sign that changes are coming in the industry, Mulligan said. "Sony has traditionally been very closed, so this is quite a sea-change for [the company]. But iPod has stolen a lot of Sony's traditional ground in the market, and Sony has realised that if it is going to creep towards the mainstream, it must have some interoperability."
When it comes to how interoperability comes into practice, content providers will likely begin by relying on cross-licensing agreements rather than a industry standard, followed by firmware updates for devices, Mulligan said.
Until that process begins, groups like Coral are also pushing for industry-wide standards.
Though Microsoft, Apple and RealNetworks have not yet joined Coral, the door is open for them to do so, said Caroline Kamerbeek of Philips' intellectual property and standards division.
"Philips hopes that as many companies as possible will join Coral because it is important to have many partners. The key to driving the market forward is interoperability. It is very important to the end user," she said.
Laura Rohde writes for IDG News Service
This was first published in October 2004