About Digital Media in Italia

1. The creation of a competitive and innovative environment for digital content in EuropeA proposal by Digital Media in Italia (dmin.it) The Digital Media in Italia (dmin.it) proposal

2. About Digital Media in Italia • dmin.it is an interdisciplinary, open, non-profit group founded in 2005 with the purpose to overcome barriers and obstacles that hinder the development of a leading and competitive digital content environment in Italy; • dmin.it has developed a proposal designed to maximise the flow of digital media. This is available at http://www.dmin.it/specifiche/proposta-completa.htm and http://www.dmin.it/specifiche/summary.htm and contains technology, and legislation and governance proposal; • dmin.it is pleased to submit to the European Commission its proposal for the creation of an interoperable and innovative digital content environment for the European Union. The Digital Media in Italia (dmin.it) proposal

3. The context • In spite of the many expectations of digital technologies for content, these have largely failed to materialise. In particular: • Media companies have embraced the technology half-heartedly giving priority to rights protection; • Consumers have embraced the technology whole- heartedly riding on the existing wealth of “analogue” content • As a result, today the size of the “open” market is dwarfed by the size of the “black” market • The problem can only be solved by finding a balanced convergence point between conflicting interests The Digital Media in Italia (dmin.it) proposal

4. The idea • Find an equilibrium point between the rights of: • Creators and their proxies to reach consumers typically through distribution chains • Operators to provide services using the technologies that best support their business • Consumers to access services with a minimum level of interoperability • Design the equilibrium point: • For the entire European Union territory, without internal barriers and obstacles • Should the equilibrium point be achieved: • A unified continental market of 500 million people will be created for the benefit of European consumers and industry; • The European cultural industry will be given lifeblood; • Innovation and competition in the digital media market will be stimulated. The Digital Media in Italia (dmin.it) proposal

5. Implementing the idea • The dmin.it proposal requires actions in three areas: • iDRM: interoperable format for controlled digital media distribution; • iNet:open access to and transport through broadband networks; • iPay: affordable online payment/cash systems. • Operators may utilise content, network and payment services of their choice (technological neutrality), but must also provide interoperable services • All other users (creators and consumers) may freely choose between proprietary or interoperable service access The Digital Media in Italia (dmin.it) proposal

6. iDRM: the interoperable format • An iDRM specification is adopted at European level • Anyone releasing content using a proprietary technology must also: • Release it using the iDRM technology, • At conditions which are not discriminatory compared with the proprietary technology • Anyone may: • Realise devices with; • Offer services based on iDRM provided that consumers are duly informed; • Request and obtain conformance certification for them; • Offer them to interested parties • The iDRM specifications are: • Public; • Implemented as Open Source Software (OSS); • Not prescriptive of a particular business model. • The governance of the iDRM ecosystem is managed by representatives of all stakeholders The Digital Media in Italia (dmin.it) proposal

7. iDRM – how it works pDRM Distribution Channels Type 1 pDRM device iDRM iDRM device Content of operator A Distribution Channels Type 2 pDRM device pDRM iDRM device iDRM pDRM: proprietary DRM iDRM: interoperable DRM The Digital Media in Italia (dmin.it) proposal

8. iNet: open network access • Broadband Providers may offer (bundled or unbundled) access to their networks with technical characteristics of their choice (technological neutrality) • Any user (content provider, intermediary or end user) may request and obtain from a Broadband Provider: • The pure two-way service-agnostic access to the "big internet“; • With technical features already offered by the Broadband Provider; • At non-discriminatory conditions. • Broadband Providers must: • Guarantee network service interoperability; • Provide agreed specific QoS levels at peering points so as to provide users end-to-end QoS levels The Digital Media in Italia (dmin.it) proposal

9. Open access to broadband networks according to dmin.it Proprietary Access Proprietary Access Proprietary Network of Operator A Proprietary Network of Operator B Network of Operator C Open Network of Operator A Open Network of Operator B Peering Point Peering Point iNet Access iNet Access The Digital Media in Italia (dmin.it) proposal

10. iPay: online payment/cash system • Anyone may open a “virtual” account based on guaranteed “real” payment systems, e.g. • Bank accounts • Credit cards • Prepaid card • Utility bill (gas, phone etc.) • etc. • Synchronisation between virtual and real circuits • Is performed at regular times or on demand • Transaction costs only apply at synchronisation time The Digital Media in Italia (dmin.it) proposal

11. The dmin.it market economy Value Chain User 1 (e.g. Retailer) Value Chain User 2 (e.g. End user) Content negotiation with payment data Network resource negotiation with payment data Acct11 Acct21 Payment with units Virtual Account Service Provider 1 Virtual Account Service Provider 2 Acct12 Acct22 Acct1n Acct2m Shared Services Bank account Credit card Prepaid card Bank account Credit card Utility bill The Digital Media in Italia (dmin.it) proposal

12. Advantages of the dmin.it proposal • Creation of a large European digital content market, with benefit for consumers and broadband networks • Lower barrier for content creators to access value chains by: • Providing more value to user-generated content • Benefitting a more pluralistic market • Possibility of new intermediation forms by combining iDRM, iNet and/or iPay functions • Unlimited possibility for consumers to access content from • Their network operators (bundled); and/or • Outside their operator’s offer (unbundled) • Discouragement of piracy because properly priced legal and interoperable content is plentiful The Digital Media in Italia (dmin.it) proposal

13. Where we are • First meeting held in Nov. 2005 • Framework proposal published in Sep. 2006 • Call for proposals of technologies published in Mar. 2007 • iDRM and iPay technologies selected in Jun. 2007 • Complete proposal published in Dec. 2007 containing, for each of iDRM, iNet and iPay • Technologies • Proposals for legislative intervention • Governance • dmin.it participants are currently developing the dmin.it reference implementation released as Open Source Software, including demo applications • P2p iDRM • VHS 2.0 The Digital Media in Italia (dmin.it) proposal

14. Flag these web sites • dmin.it web site • http://www.dmin.it/ • Complete proposal • http://www.dmin.it/specifiche/proposta-completa.htm (in Italian) • http://www.dmin.it/specifiche/summary.htm (excerpts in English) The Digital Media in Italia (dmin.it) proposal