DRM: Media companies' next flop?

Media players are risking a consumer backlash by deploying overzealous systems with such limitations, say experts at Wharton, especially in the wake of Sony BMG's decision last year to sell CDs with copy-protection software using "rootkits"--computer software frequently used by hackers to cloak the presence of viruses and spyware.

Sony says it didn't intend to create an opportunity for hackers to target consumers' PCs. On Jan. 6, a U.S. District judge in New York gave preliminary approval to a settlement under which Sony agreed to take back the 50 CD titles with DRM software and replace them with new, unprotected versions. Indeed, according to a document on the Sony BMG Web site, the DRM software was "intended simply to prevent copying beyond the level appropriate for personal use."

The Sony incident, however, raises a host of questions. First and foremost is whether consumers are being duped when they buy content, only to find there are restrictions on transferring music to multiple devices or, even worse, that the DRM software exposes their computer to security risks. Other questions include: Is DRM worth the effort? How can you balance the rights of consumers with the rights of media companies? And what's the future of DRM?