Press Releases 2005

MPEG LA's Revised Terms For Digital Rights Management Still Unacceptable

GSMA review continues - strong candidates emerging but new issues arise

London, UK, 04 ^th May 2005: The GSM Association (GSMA), the global trade association for more than 660 global mobile operators, today confirmed that its evaluation of Digital Rights Management (DRM) solutions continues despite MPEG LA's revised proposal, which was again met with dismay by the operator community.

Last month, the GSMA - whose members serve more than 1.3 billion mobile users - expressed operators' discontent at MPEG LA's original license terms, warning that its impractical terms would force operators to implement disparate solutions and thereby fragment global mobile services.

The GSMA's Board called on all suppliers of DRM solutions - essential to allow the consistent and easy delivery of music and video files across and between mobile networks and their customers - to put forward alternate schemes for evaluation. Some fourteen proposals were submitted to the GSMA for review.

The stance adopted by the GSMA, and the market in general, led MPEG LA to revise its proposal with reduced handset and transaction licensing fees. However, the Association's Board has expressed serious disappointment with the revised terms - both in terms of the fee levels and complexity of the scheme.

"MPEG LA is missing a tremendous opportunity to unite the industry behind one solution," said Rob Conway, CEO of the GSM Association and Board member. "It's clear that the revised proposal remains unreasonable and unworkable - but we are confident that MPEG LA will continue to respond to market feedback."

The GSMA Board is also frustrated by the lack of transparency surrounding the details and structure of IPR that MPEG LA considers 'essential'. These details have not been revealed to date, which has led to members' questions regarding the validity of the patents.

The GSMA's review process has identified several strong DRM supplier candidates, but it has also uncovered additional material issues that require resolution. The Board is therefore unable to make a final recommendation to its Members until these outstanding issues have been resolved. It has instructed the GSMA to work with candidates toward a resolution, and to complete the process as quickly and as reasonably as possible.

"We must find cost-effective ways to open the content market and drive the flow of rich multi-media content across the mobile world," said Frank Boulben Executive Vice-President, Brand & Consumer Marketing, Orange. "It's disappointing that the MPEG LA has not taken on board our previous concerns. The current terms of its proposals will lead to fragmentation owing to unacceptability, and critically delay launches of these new mobile services."

"It is essential that the industry adopts a unified approach to Digital Rights Management", said Alan Harper, Strategy Director, Vodafone Group. "Unless we do so fragmentation remains a real concern. We are extremely disappointed that MPEG LA has not responded appropriately to the scale of opportunity that the industry has before it to nurture and grow the mobile content market to achieve its full potential. It is therefore essential that the GSMA's DRM review process continues until a practical solution is found."



About the GSM Association

GSMA Contacts

Mark Smith
Tel. +44 (0)20 7759 2300
Fax. +44 (0)20 7759 2301
Email: press@gsm.org

Kevin Taylor
Companycare Communications
Tel. +44 (0)7850 858 291
Email: Kevin.taylor@companycare.com

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