Digital Rights Management (DRM), a software technology which provides content developers and paysite owners with the ability to protect distribution of their video content, along with peer-to-peer (P2P) networking, a system of computers used for free file-swapping, were the key issues at the “Selling Your Video Content” seminar at the 2004 Phoenix Forum..Digital Rights Management (DRM), a software technology which provides content developers and paysite owners with the ability to protect distribution of their video content, along with peer-to-peer (P2P) networking, a system of computers used for free file-swapping, were the key issues at the “Selling Your Video Content” seminar at the 2004 Phoenix Forum.

The seminar panel, which featured Randall Crocket of DRM networks, Jason Tucker of Playa Solutions, Jay Janarthanan of National Net, Christopher Levy of Buy DRM, Lange Palmer of Twisted Cash, and Stephen Bugbee of X2K Media Services Group, were unanimous in the opinion that profitable paysites must add video content.

“If you don’t have a video intensive site, you’re not going to get traffic,” said Crock.

Pay site operators considering video-on-demand (VOD) should do so on a limited scale and test multiple payment models before transferring VOD to their main site.

Palmer noted that his revenue increased significantly when he switched from a membership model for video to a pay-per-view model. “I’m seeing some members spend a couple of hundred dollars per week via tokens,” he said.

Considering the profitability of video, the panel recommended that operators wrap their video content with DRM, which can determine if a surfer has paid for access to the content and for how long.

“It’s really easy to secure DRM on video,” said Levy. “You deliver your files to us on disk or upload them to our server, then we encode them and push them back to you.” Levy also said the upfront cost of initiating DRM is relatively inexpensive. “Run if someone swings a $10,000 set-up [fee] in your face.”

The panel recommended that video be encoded for Windows Media Player if DRM technology is being implemented. The rationale is that Microsoft’s DRM package feeds the player that has the highest market penetration.

Other video formats include DIVX, Rio, and QuickTime – each of which, according to the panel, can be expensive to use and complicated to integrate with DRM. There is no DRM solution for MacroMedia’s Flash.

File format plays a factor in chargebacks, noted Bugbee. Surfers are prone to cancel their memberships if an operator offers movies in a format unsupported by Windows Media Player.

DRM, according to Tucker, is a great solution for marketers who plan to distribute video on P2P networks. “Don’t be afraid of your content being jacked,” said Tucker. “The guy who just jacked it is going to share it with twenty others” and drive traffic to the paysite operator who made it available on the network.

Tucker’s company, Playa Solutions, specializes in P2P video distribution. Clients provide the company with DRM-encrypted files, which the company uploads to distribution servers worldwide. Revenue is split between Playa and the client.

Tucker and others on the panel explained that by using DRM, operators can distribute movie clips that request an email address or redirect the surfer to a paysite where they can view the full movie. DRM also allows the insertion of affiliate codes so that Webmasters can get credit for sales.

Kevin Knuhtsen works in the TopBucks marketing and business development department. His primary project will be directing development and marketing of TopBucks’ new streaming product for pay sites, PlugInFeeds.com. Kevin can be reached at kevink@seekio.com.