NEW YORK, Aug 7 (Reuters) - The music industry is escalating its crusade against Napster-style music swapping with a plan to place stringent controls on compact discs -- including, perhaps, the one you bought last week.
Some of the world's major record labels -- Vivendi Universal's Universal Music, Sony Corp.'s Sony Music, AOL Time Warner Inc.'s Warner Music, EMI Group Plc, and Bertelsmann AG's BMG -- are already running quiet field tests of CDs that cannot be copied, or "ripped," to a personal computer.
Using technology from companies such as Sunnyvale, California-based Macrovision Corp and privately held Israeli firm Midbar Technologies, the labels hope to staunch the flow of CD-to-MP3 copies that made the file-trading service Napster possible in the first place.
MP3 is a compression format that shrinks CD tracks to a more manageable size and is a popular medium for trading music online.
Despite the record labels' hopes that copy-protection will protect them from the countless Napster offshoots, Jupiter analyst Aram Sinnreich said that flawless copy-protection is unlikely any time soon, and that even a workable system will trigger a backlash.
"Consumers are going to run screaming from these kinds of solutions," he said. "This could be much more of a PR hazard for (record labels) than Napster ever was."
HOW IT WORKS
Although the specific details of the copy-protection schemes are closely guarded, in broad terms the technology exploits the difference between the standard used by consumer CD players, known as RedBook, and the standards used for CD drives in personal computers, known as YellowBook and OrangeBook.
"What we do is a modification to the way the CD is placed on the disk that confuses the (computer's) drive," said Eyal Shavit, Midbar's vice president for research and development. The company said it is working with at least one of the major record labels in field tests.
Computer CD drives are much more sensitive than normal CD players, which are designed to ignore small errors from scratches, jolts and dust. So by adding small errors, CDs are rendered unrippable and in theory normal listening is unimpaired.
Macrovision and Midbar both said their systems easily passed "golden ears" tests, in which trained audiophiles attempt to discern an audible difference between protected and unprotected CDs.
WHAT CAN GO WRONG
In practice, there are hundreds of different CD players on the market, so there is always a chance that a law-abiding consumer will insert a CD and hit play only to hear digital gobbledygook.
A European field trial of 130,000 protected CDs conducted two years ago by BMG and Midbar ended in failure, after about 3 percent of users couldn't listen to the CDs they purchased. Midbar says it has fixed the problem and can now achieve "near-100 percent playability."
Macrovision President and Chief Operating Officer Bill Krepick said his company's copy protection scheme is being used in hundreds of thousands of CDs now on the market without any complaints, but that "it's impossible to get to 100 percent."
He said a best-case scenario would result in about 99.6 percent or 99.7 percent playability, leaving thousands of consumers with unusable discs.
FAIR USE VIOLATION?
The potential problems for copy-protected CDs don't stop there, according to intellectual property attorney Bobby Rosenblaum of Greenberg, Traurig.
"There's a doctrine called copyright misuse," he said. "A lawsuit could be brought by an individual or class claiming these (copy-protection) technologies are defeating their fair use rights."
For example, owners of digital audio players routinely rip their own CDs so they can listen to them in MP3 form, but such a practice would come to an abrupt halt if copy protection were successful.
BMG Senior Vice President Sami Valkonen said his company may have a partial solution. It plans to include two versions of every song on a CD -- one unrippable track for listening, and one digital file to transfer to the computer.
The digital files would not be MP3s, but rather a format like Microsoft's Windows Media Audio, which incorporates digital rights management to prevent unlimited copying.
CRACKING THE CODE
And then there are the hackers.
Any attempt by record labels to lock up their content is sure to send programmers searching for the key -- if only for the challenge of breaking the copy-protection scheme.
A article on the Web site cdfreaks.com claims to have already broken the Macrovision CD copy-protection scheme known as SafeAudio.
"I've never seen a industry that is so keen on money and tries in any way to protect it's (sic) products so desperately," the author of the article, "DoMiN8ToR," wrote. "Since they have stopped Napster they are disliked by more and more people, but they don't seem to care."
Krepick said he could not confirm or deny any specific attempts to crack his company's system. He did say that copy-protection would likely become a cat-and-mouse game between hackers and the companies that make the systems.
However, anyone who attempts to subvert a copy-protected CD may face jail time under the U.S. Digital Millennium Copyright Act, or DMCA.
"Now that we've passed the DMCA and we have these copyright restrictions, the copyright holders can wrap any restrictions they can dream up around their works, and anyone who bypasses them violates the law," said Robin Gross, a staff attorney for the Electronic Frontier Foundation. "It's a very scary world."