the insider - Sony DADC

Customer News 2009.2 www.sonydadc.com
Engineering a greener future
The Sony Corporation commits strongly to environmentally
sustainable manufacturing and business operations
Blu-ray Disc
242% sales increase in 2009
International Asset Sharing
Simplifying Blu-ray distribution for both movie studios and regional distributors
ARccOS
360° content security for your video assets
Sony DADC

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Welcome
Welcome to the new issue of “the insider”, which is packed
full of news from Sony DADC and our customers
throughout Europe. We hope that you enjoy reading
about our success stories so far this year.
Without doubt, we live in challenging times. The worldwide
economic downturn is posing challenges to all organisations,
in every regional market.
Our customers need strong partners: not just in terms
of technical knowledge and infrastructure capabilities,
but also with sound financial security which will enable
them to operate throughout the current difficult conditions.
Above all else, this is what Sony DADC is – a strong partner,
focused on helping to support your business. We
are here today, we are succeeding and we are seeking to
expand and refine our customer services from authoring
to every stage of the supply chain. In physical media
– and in online services, on a national, pan-European
or global level.
We are approaching the busiest time of the year in
terms of the peak autumn sales period.
Market research indicates that consumer demand remains
strong in the home entertainment market, and
especially in the home video sector. In particular, Bluray’s
development as the next generation High Definition
successor to DVD continues at pace. As you will read
later in this newsletter, BD movie sales continue to grow
rapidly in Europe, fuelled by a broad and fast growing
catalogue of movie titles, combined with significant decreases
in player prices.
Some Blu-ray new release movie titles have broken
through the 30% share level and this is another strong
indicator that the format is close to entering the consumer
mainstream.
We have the production capacity and the creative capabilities
to enable our customers to exploit this exciting
new home entertainment platform. Furthermore, our
investment in supply chain services means that we offer
a true one-stop-shop solution to any content publisher
or distributor looking to establish a strong market presence
in Blu-ray.
When market conditions are difficult it is entirely understandable
when companies become more conservative
in their outlook and more averse to risk. However, we
live in an evolving technological landscape and people’s
media consumption patterns are changing quite rapidly.
We see it as a priority to keep abreast of these new
developments.
In particular, consumers are looking for increased mobility.
Digital Copy is one example of how new technology
can enhance our ability to watch our favourite movies
and TV programmes on the move.
At Sony DADC, we continue to invest in the future of
the home entertainment industry. Investing to make
sure that we continue to provide best in class service
and support to our customers.
Dieter Daum
President Sony Disc and Digital Solutions
Table of contents
04 Blu-ray Disc in Europe
"the insider" talks to Ulrik Rasch and Tore Skarelid
05 Blu-ray Authoring
BD authoring at Sony DADC –
capacity. creativity. capability.
05 Blu-ray Authoring
Interview with Sigi Obermayr, Vice President Sales
at Sony DADC UK
06 Blu-ray Sales
Blu-ray market report: 242% sales increase in 2009
06 Blu-ray Distribution
Sony DADC rationalises Blu-ray distribution for
both movie studios and regional distributors
07 Digital Copy
New report identifies 42M Euro market in UK
07 eBridge
Sony DADC creates eBridge to green energy
08 Distribution Services
European news
10 Packaging Solutions
Special Packaging Sourcing from China
11 Video
ARccOS – 360° content security for your video assets
12 Software + Games
Boost software and games sales with SecuROM
13 Digital Content Services
Digital deliveries to Sony Ericsson’s PlayNow Arena:
millions of tracks
13 eBridge Audio
Pearl Jam create an eBridge to their fan base
14 Green Manufacturing
Engineering a greener future
Editorial & Layout/Graphics:
Arkin Kol – Director Sales & Marketing Communication
Marcel Penning – Marketing Communication
Christina Schobesberger – Public Relations
Britta Meissner – Graphic Artist
Owner & Publisher:
Sony DADC · Sonystrasse 20 · 5081 Anif/Salzburg · Austria
Phone: +43 6246 880 237 · marketing@sonydadc.com
© Sony DADC Austria AG 2009
Sony DADC disclaims all responsibility for errors in quotes & facts.
We thank all of those who have contributed to this edition of “the insider”.
the insider
3

a view
inside
4
Blu-ray Disc in Europe
#1 Nordics
Tore Skarelid Ulrik Rasch
How is Blu-ray doing in the Nordics?
Ulrik: BD has got a tough start as most new formats
are getting. But overall, BD is doing fine, it is steadily
increasing. People from the Nordics are quite equipped
to new technologies, so there is naturally a very good
acceptance for new things.
Tore: Blu-ray is growing fairly quickly, but this varies
between the Nordic countries. In Sweden, the value
growth for distributors is year to date 53%, while it is
200-300% in Denmark, Norway or Finland. There is still
quite a lack of consumer information, awareness of the
advantages of BD and awareness that players are backwards
compatible with DVD. The home video industry
has to work closer with retail to secure space and information
campaigns.
Ulrik: Yes, retail has to be attracted as well. A way to
bring that forward is to generate attractive packages
for retail. And reach attractive price points of course.
It’s important to get the key shop personnel understand
the difference between BD and DVD – with a few key
messages, explained in a very sustainable way, so that
the shop personal can bring the right messages across,
both in general retail and electronics shops.
What is your company's Blu-ray strategy?
Tore: We try to release all relevant titles, of which we
know that they work well on Blu-ray. These are usually
new releases, bigger titles.
Ulrik: We support BD and will continue to do so. We
are an opportunity-driven company with a huge backcatalogue,
which provides some very interesting oppor-
Blu-ray Sales Contact Nordics
jesper.schertiger@sonydadc.com | Phone: +45 7070 27 25
the insider
"the insider" talks to Ulrik Rasch, General Manager of Nordisk Film A/S – Operations and
Tore Skarelid, Senior VP Home Entertainment at Svensk Filmindustri.
tunities. Not just for us, but also for end-users. Sony
DADC has designed a backcatalogue model for us, helping
us to accelerate BD growth and fully exploit our
backcatalogue’s BD potential.
At the beginning, our typical BD customer was the
17-40 year old male who was interested in action and
adventure genres. Now also other genres are getting
momentum, as releases like Twilight and High School
Musical show. In Norway, the average distributor value
of Blu-ray is already close to 10%. We definitely want to
get into the mass market as well, by focussing more on
general retail, not just electronic stores – and our backcatalogue
of course.
As a fully integrated entertainment company, who also
does music, games, tv/film productions and runs cinemas,
we are especially focused on our local content.
Among the recent release top ten for Norway, 4 out of
these 10 are local productions from Nordisk Film. For
the recently released Stieg Larsson movie “Man who
hates Women” we already sold 2.7M cinema tickets.
The home video versions have just been released and
we anticipate a BD share of 10% in terms of value.
How do retail and consumers respond to your BD
titles?
Tore: There is interest in the format. Even in Sweden, Triple-A
titles are currently around 10% of the volume. Documentaries
like Planet Earth are doing really well, so we
will continue releasing such high end documentary titles.
How could retail help to make BD more successful?
Tore: By educating the consumers. The best way is probably
to enable the Blu-ray experience in-store, provide
brochures and pamphlets.
Where do you see Blu-ray in the Nordics in 3 years?
Ulrik: I am pretty convinced that BD will be successful.
There will be a natural shift from DVD to BD, but that
won’t happen from one day to the other.
Tore: Hopefully at 30% plus, in terms of distributor revenue,
maybe even more.
What services are required by the replication and
distribution industry?
Tore: From an independent point of view there has to
be an attractive cost structure for all steps of the value
chain, so we can compete with the price offerings of
the majors. Supply chain service providers need a holistic
view on the market. The retail displays Sony DADC
offer us are instrumental in putting Blu-ray into the mass
market.
We all hope and trust in the BD format, it is extremely
important for our industry in long terms. We are optimistic,
but there are still some challenges. Long term it
will be fantastic.
Ulrik: One of the core things is side dialogue concerning
opportunities and business models. That’s exactly what
you do now, especially since you have established your
local service offices in the Nordics. It’s no use if replicators
and distributors develop different services which
are not very much in line with in what we as a entertainment
company are looking for. Continuous dialogue
with the key accounts is extremely important. By the
end of the day, we are all living by consumer demand
and we have to team up to bring attractive content to
end-users in an attractive way. Our aim is to always completely
deliver what our customers want. Sony DADC is
a good partner as you are pretty much ahead at looking
at digital solutions.
How are PlayStation 3 sales doing in the Nordics?
Ulrik: So far, PS3 hardware penetration is more than
half a million. The recent announcement of a very
attractive, new PS3, which is slimmer and offers a 120GB
hard drive, makes us extremely optimistic as we are
entering peak season. In terms of PS3, peak season will
start earlier this year due to the new console. PlayStation
fans will get more for less. Also, there is a fantastic lineup
for the coming months, both from the movie side
and from Sony Computer Entertainment.

BD authoring at Sony DADC
capacity. creativity. capability.
Sony DADC is a pioneer of Blu-ray and has been instrumental in the format’s evolution over a number of
years. The company has followed a pan-European strategic investment programme, which today sees it
offering a one-stop-shop solution for content publishers and distributors looking to exploit this rapidly
developing market.
"Valkyrie, this great project,
enabled TF1 Vidéo and Sony DADC
to develop an exciting partnership
and to achieve very high standards
in BD authoring technology."
Sébastien Aussal,
Marketing Product Manager at TF1 Vidéo
This one-stop-shop solution starts at a project’s planning
stages, continues through the authoring & mastering
studio, through replication to final supply chain management
right the way up to the retail shelves.
Blu-ray authoring requires technical knowledge blended
with creativity – in these two areas Sony DADC’s European
authoring network stands apart from any other
facility.
Sony DADC has established three Blu-ray authoring centres
of excellence – in Salzburg, London and Paris – from
where it can now support up to 60 titles each month.
Sony DADC Authoring
alexander.desch@sonydadc.com | Phone: +49 607 44 98 168
BD-Live focus
BD-Live is a key feature of the Blu-ray format: it transforms
a passive viewing experience into immersive interactivity.
There is a wealth of creative potential in BD-Live, so long
as the author has the technical and creative power to
harness it. This is exactly where Sony DADC offers clear
market leadership.
Working with Sony Pictures Home Entertainment (SPHE),
the company has developed a new facility called movieIQ,
which utilises the Blu-ray player’s internet connectivity
and BD-Live to provide unparalleled information about
the movie being played.
By connecting with a movie database, the viewer can
instantly access information about the movie, cast, setting
and even the soundtrack of the movie scene at the
push of a button.
movieIQ has been created jointly by SPHE and Sony DADC
and will become broadly available for Sony DADC customers
in 2010. In September 2009, movieIQ will feature
on major Sony Pictures releases, including Angels and
Demons and Terminator Salvation.
Another showcase title that is a product of Sony DADC’s
BD authoring network is the French regional version of
Valkyrie. “Working with TF1 Vidéo, we have created
an interactive menu based on BD-Java that just oozes
creativity and passion,” remarked Simon Holpert, Sony
DADC Authoring France. “The menu can be accessed
at any time without interrupting the movie. It provides
loads of bonus features, such as interactive maps, playlists
of actors, biographies of the main characters and
much more.”
Sony DADC Authoring France
simon.holpert@sonydadc.com | Phone: +33 1 64 13 82 43
"We will not jeopardise
the quality of our work"
Interview with Sigi Obermayr, Vice
President Sales at Sony DADC UK on
BD authoring situation in the UK.
A number of authoring houses in
the UK are struggling or have pulled
out of Blu-ray authoring. There are
concerns that the drop in capacity
may mean that content owners
find it hard to get titles made in Q4,
which could impact title sales over
the holiday season. What are your
thoughts on that situation?
Well in the U.S., video publishers are investing significant
amounts in publishing their content in both DVD
and Blu-ray formats. Their investments are long-term
– making sure their authoring and replication partners
have the right procedures in place to ensure quality and
present their content in the best ways possible.
In Europe, we experience pressure from publishers to
minimise authoring costs. Inevitably, this has a knock
on effect in terms of the amount of time, and therefore
creativity, that can be invested in the critical authoring
process. Also, less time and resource means fewer
quality checks and a greater chance of faults slipping
through the net.
How do you respond to this cost pressure?
At Sony DADC we refuse to take on projects below a
certain price level since we will not jeopardise the quality
of our work. Sadly, the hourly rate of a tradesman
in London is approximately double the current rate for
C&A services, so I'm not surprised that some studios are
struggling as they have invested massively in equipment
and training.
Will this lead to a capacity problem?
Currently, in the UK market, authoring prices have fallen
below a sustainable level, so I can see a situation
where other studios might experience real difficulties
and some may even go out of business. However, I do
not foresee a C&A capacity problem as there are still enough
studios in London – I just wish that UK publishers
would invest a bit more in creativity and quality, which
will help their C&A partners remain solvent.
At Sony DADC, we remain focused on this key market. If
anyone has problems authoring titles for Q4 release, or
anyone would like an update on the latest evolutionary
developments in BD-Live or BD-Java – please contact us.
Sony DADC Authoring UK
jo.houghton@sonydadc.com | Phone: +44 20 7307 9789
the insider 5
a view
inside

Blu-ray market report: 242% sales increase in 2009 *
Over one in five homes across Europe is now Blu-ray Disc enabled! *
*Futuresource Consulting Ltd., 2009
At this year’s Consumer Electronics Show (CES) in Las Vegas, the Blu-ray Disc Association announced that Blu-ray had become the fastest establishing format
ever – faster than DVD, CD and even colour television itself.
Now, mid way through 2009, this outstanding performance
continues. The latest Futuresource forecasts predict
that by 2013, Blu-ray will account for over 60% of
home video revenues in Europe and U.S.
In Europe, Blu-ray video sales are set to increase by
242% (288% in volume over the last 52 weeks compared
to last period) in 2009 when compared with the
same period last year. In addition, based on the strong
release slate in fall this year, it is predicted that volume
growth will exceed 300% by the end of the year. This
International Asset Sharing:
Sony DADC rationalises Blu-ray distribution for both movie studios and regional distributors
Traditionally, the distribution of regional versions of movie titles can a be complex task. For distributors looking to market a title within a regional market, Blu-ray
creation can be an expensive process. Each time a regional variant is created there are a number of essential components that are required – from HD video & audio
masters to bonus tapes and subtitle sources. Also, menus must be created and audio/video elements encoded in order to create a CMF Blu-ray master. Not to mention
the added complexity of creating sleeve artwork and any booklets that are required.
“Since each regional variant starts with the same basic
elements and results in a very similar Blu-ray product,
there are great opportunities for synergies if their creation
is co-ordinated centrally” explained Fritz Deininger,
Vice President International Sales at Sony DADC.
“Now, Sony DADC has introduced a range of central
Blu-ray and DVD authoring services to all international
distributors for independent movie studios. Called the
‘Blu-ray Asset Sharing System,’ this centrally co-ordinated
business model brings advantages to both the content
owner and the regional distributor” he continued.
For the content owner as they have a single point of
storage for their assets, sure in the knowledge that it is
being safeguarded by the industry leader in asset management.
Having a central location at Sony DADC,
going forward, digital distribution services can be easily
provided. Sony DADC is also providing any world wide
digital distribution needs. Furthermore, a single point of
contact reduces their administrative burden and makes
life simpler and more rewarding.
6
Blu-ray Sales Contact
marcel.hasenrader@sonydadc.com | Phone: +43 6246 880 554
the insider
growth will be fuelled by a rapid increase in player sales,
stimulated by falling price tickets, which currently start
at Euro 110 and could fall below the magical Euro 100
mark this autumn.
As a result the European installed player population is
set to increase by over 80% this year, topping 10.3M
by year’s end.
“In the UK, six movie titles have exceeded 10% sales
share,” commented Chris Reiser, Executive Vice President
at Sony DADC. “Average sell-through-share in
The content owner retains complete control of their assets
and can make certain that their title has the same
look and feel, irrespective of which territory it is being
distributed in.
Distributors identify real cost savings
There are significant advantages for the distributor: for
instance, major cost savings provided by this new asset
sharing model – both in terms of input costs, such as
film and authoring, as central authoring creates a template
that can be easily localised.
Additionally, there is simplicity in this model: Sony DADC
provides a true one-stop-shop for Blu-ray and DVD regionalisation,
making the whole process easier to oversee.
Furthermore, with as Europe’s premier Blu-ray production
network and easier access to content, Sony DADC
offers valuable time saving, meaning that distributors
can have their titles on the street earning revenue in the
shortest possible time.
International Sales
friedrich.deininger@sonydadc.com | Phone: +43 6246 880 504
terms of units is 6% but in terms of value it is almost
9% indicating that this is a premium product that consumers
are prepared to pay for.”
“Blu-ray represents the future for packaged home entertainment.
At Sony DADC, we have invested strategically
in this exciting technology in order to help our
customers fast track their Blu-ray businesses, thereby
maximising current and future revenues,” he continued.
Last, but by no means least, distributors will be freed of
the need to arrange AACS and BDA agreements since
within this business model, this
requirement is fulfilled by the
content owner.
Newline is one independent movie
studio that has been swift to
recognise the potential this system
offers and so have its key
territorial distributors, such as
Eagle Pictures, one of its distributors
in Italy.
“Through the Asset Sharing System,
it has become easy and
cost effective to order our local
versions of major independent
Blu-ray releases,” commented Luisa Bonalumi, Marketing
Manager, Eagle Pictures. “Sony DADC looks after
the authoring, approvals and replication. We just send
our language track – everything else is taken care of.”

Digital Copy:
New report identifies 42M *
Euro market in UK
Digital Copy – an intelligent digital rights mechanism that enables users to legally copy
a digital file of movie content from a disc to a range of portable players – is tailor-made for today’s mobile lifestyle.
With Digital Copy, you can choose exactly how, where
and when you will watch your favourite movies.
It has been available in the U.S. since last year and it has
taken that market by storm. So much, that today the
main Hollywood studios incorporate it as a mainstream
feature on many new releases in both Blu-ray and DVD.
But will this technology have the same appeal in Europe?
The finding of a market research report commissioned
by Sony DADC in the UK and carried out by TNS
World Panel is a resounding ‘yes’.
After polling more than 3,000 UK consumers this
spring, TNS discovered a potential market of over 1.6M
consumers willing to buy into this technology over the
coming 12 months. This, TNS predicts, could create new
revenue streams in excess of 42M Euro in the UK alone,
indicating that on a pan-European scale this could be a
very significant new market for the home video industry.
Initially, the report identifies two prime markets in technically
savvy families and the traditional technology early
adopter market segment. These consumers tend to be
online shoppers and TV is a big growth opportunity for
this market. Despite their relatively high ownership of video
iPods, video enabled phones and PSPs, PCs and notebooks
remain the number one destination for downloads.
Sony DADC creates eBridge to green energy
Developed by Sony DADC, eBridge is a unique discbased
concept that fuses traditional direct mail
and digital media to close the gap between offline
and online marketing communications.
In Germany, this revolutionary system has been used by
green power supplier, ENTEGA, to promote the many
advantages of green electricity.
Product Manager Video
sonja.hauck@sonydadc.com | Phone: +43 6246 880 81622
Download
report
The importance of one-click-ability
However, the report has revealed one weak point in the
traditional form of Digital Copy: it requires the user to
key-in a 25 digital alphanumeric code to access the digital
file on the disc. This, so TNS World Panel reports, can
be a major stumbling block to the system’s mainstream
acceptance.
Now, Sony DADC has developed a refined version of Digital
Copy which integrates it alongside the company’s
PID system.
The beauty of Sony DADC’s Digital Copy with PID lies
in its simplicity. PID is Postscribed ID technology, which
is applied to each disc during the manufacture process.
The PID is automatically read by the player and does
away with the need for cumbersome serial codes. Digital
Copy with PID is applicable to a range of disc formats,
including DVD and Blu-ray Disc.
The instructions stored within the PID are defined by the
publisher: the end-user is free to make as many copies of
the content as the publisher prescribes. So, at the click
of a mouse, the consumer can copy the movie over to a
laptop hard drive or many other media storage devices.
The beauty of eBridge is that each component is completely
personalised. Each CD-ROM is equipped with a
unique identifier that includes the recipient’s name and
residence. So, after an engaging film intro that looks
at climate protection, recipients are seamlessly directed
online. Thanks to eBridge, the web server recognizes
who is online and provides them with a tailored rate
comparison that enables them to calculate what kind
of savings they could expect by signing up to ENTEGA’s
Contact for Digital Marketing Solutions
christian.dankl@sonydadc.com | Phone: +44 20 7307 9773
Intelligent feedback of media
consumption patterns to the publisher
Digital Copy with PID comes with eBridge Analytics, a
Sony DADC online platform that shows detailed statistics
about the usage of Digital Copy. This means that once
the consumer has opted into this system, each disc can
be identified and the user’s media usage can be tracked
and interpreted accurately via an internet connection.
“Digital Copy with PID combined with eBridge Analytics,
fulfils two major needs of today’s home entertainment
marketers: to get valuable feedback about their consumers’
preferences as well an opportunity to differentiate
their product in a retail environment,” commented
Sonja Hauck, Product Manager Video at Sony DADC.
“Digital Copy with PID provides a ‘best in class’ Digital
Copy experience for both consumers and publishers.”
Download
report
www.sonydadc.com/digitalcopy
*This forecast is explained by three factors. Firstly, Digital Copy adds value to packaged
media and will prevent price erosion, instead stabilising disc prices. Another
result of this perceived added value is a significantly increased number of impulse
purchases. Thirdly, Digital Copy with PID provides a direct link to consumers with
registration data - such as email addresses - available, which can be used in e-mail
marketing to increase sales.
special Climate Protection Promotion Rate. This means
higher engagement and thus higher response rates.
Conceptualised by Frankfurt-based agency OgilvyOne,
the 770,000 unit campaign used targeted direct mail, as
well as being inserted in daily newspapers and as a point
of sale promotion.
Besides ENTEGA, eBridge is increasingly used by energy
providers to promote their green initiatives, like EDF in
France or German industry energy provider Watt.
the insider
7

Distribution services:
European news
8
Enfield, UK
Integrated customer service
Based at its Enfield distribution centre, Sony DADC has launched a pilot
project that provides a personal perspective to the supply chain service
challenge. 2 entertain and Network are two customers that enjoy a designated
point of contact for both production and distribution services
within the Sony DADC team.
This approach assures enhanced service provision and better integration
between the steps of the supply chain. At the same time, it reduces the
workload on publishers since all co-ordination activities are handled by the
Sony DADC contact.
Contact for Distribution Services
thomas.irnberger@sonydadc.com | Phone: +43 6246 880 250
the insider
Moissy, France
New French joint venture selects Sony DADC
Established as a green field site in 2007, Sony DADC’s Moissy distribution centre has
undergone further investment and expansion of headcount to meet the strong demand
for its integrated supply chain service.
Its latest customer win sees a new joint venture that accounts for around 20% of the
French home video market formed from Sony Pictures Home Entertainment France
and TF1 Vidéo select Sony DADC.
Sony DADC will provide a full supply chain service, including a comprehensive retail
administration facility. This will enable major efficiencies and synergies, providing integrated
services that were previously carried out within each joint venture member,
and creating a state-of-the-art distribution network for this ambitious new company.
“Our aim is to be an interface between retail marketing and the joint venture’s operations,”
commented Camille Magro, Managing Director Sony DADC Distribution
France. “As a next step we intend to provide intranet solutions for our customers
similar to those we offer in Scandinavia.”
Enfield
Moissy
Milan
Borås

Borås, Sweden
Home deliveries for premier
Nordic online retailer
Based in Malmö, Sweden, CDON is the Nordic region’s leading online retailer and
a leading player in the region’s dynamic home entertainment market. The company
has signed a partnership agreement with Sony DADC’s Entertainment Network
Scandinavia (ENS). From next March, ENS will ship around 8M titles each year directly
to households in the Nordic region.
“We were looking for a strong partner that can support future growth within our
business,” explained Mikael Olander, CDON’s MD. “The retail landscape in the Nordics
is significantly changing. Special music stores in smaller towns are becoming less common,
leading to an increasing focus on online retail. ENS has huge warehouse capacities
and their IT distribution system enables fast access to our products. Online orders
for CDs and Music DVDs are picked, packed and shipped to consumers the same day.”
“ENS was already an intermediary supplier for CDON. With this distribution agreement,
Sony DADC for the first time distributes direct to consumers and CDON benefits
from a faster access to the labels’ music order books.” stated Stig Ingelström, Managing
Director of ENS.
Milan, Italy
Sony DADC well equipped to offer
full supply chain service
Sony DADC Italia has announced a co-operative partnership with Silvano
Chiapparoli Logistica SPA.
This agreement combines Chiapparoli’s market leading distribution and logistics
network with Sony DADC’s order desk, order-to-cash and replication
services to create a customer focused solution for Italian customers.
“When we first visited one of Chiapparoli’s distribution centres in Lodi, we
were impressed by the facility and its efficiency” explained Massimo Boldetti,
Sales Representative for Sony DADC in Italy. “We believe that Chiapparoli
perfectly complements our services. The strength of our joint offering to
customers lies in the combination of the front office services and IT solutions
of Sony DADC and Chiapparoli’s first class distribution and logistics.”
New retail services in the UK
In the UK, Sony DADC has created a team, headed
by Andy Palmer that is aiming to get closer to the
retailers’ needs. Already, the team has instigated a
number of new initiatives aimed at driving down
supply chain costs for both content publishers and
retailers.
Shelf ready packaging applied at the distribution site
can produce up to a 10% increase in product exposure.
It means the product literally goes directly into the shelf.
The retailer saves on staff time since they no longer have
to sticker, tag or put the products into safer cases. This
frees them for other tasks, such as filling empty shelf
space and serving their customers with the resulting
uplift in sales.
Another initiative is consolidated returns management.
Whilst content publishers normally provide retailers
with a privilege returns allowance in the region
of 10% of invoice value the process of sending back
returns to each publisher and reconciling credit notes
can be time consuming. Now, retailers place all the returns
in a single container which is returned to the Sony
DADC distribution centre. The stock is sorted in bulk to
be returned to the original supplier, re-worked or sent
for destruction. Sony DADC staff finalise the process by
raising the credit notes to the retailer.
A number of Sony DADC services have been developed
with environmental sustainability in mind. Automated
packaging and reusable plastic totes help to lower
the carbon footprint. Also, a recent study by AlixPartners
indicated that Sony DADC’s network is strategically
positioned close to the major urban areas and hence
close to the main retail centres, requiring the shortest
transport and thereby minimising CO 2 emissions.
Often simplest is also most efficient: most stores order
on a daily basis – sometimes as few as 10 units. Now,
under the banner of supply chain simplification,
Sony DADC bundle these orders into 2 or 3 weekly
deliveries, so retailers save transport costs and staff time,
while content owners reduce their distribution costs.
the insider
9

Special Packaging Sourcing from China
Products manufactured in China are being exported worldwide – from toys to garments, Chinese manufacturing
skills are diverse and high quality. Also, abundant supplies of skilled labour means that they can offer
some of the shortest turnaround times for new product development.
An area where Chinese suppliers have excellent knowledge
and experience is specialised packaging products.
These range from extruded plastic to metal, wood and
rigid board materials.
With the strategy of tapping into these special packaging
resources, Sony DADC has established dedicated purchasing
teams in Shanghai, Hong Kong and Shenzen.
Through these teams, the company can source at local
Chinese suppliers and build close relationships with the
main special packaging facilities.
“Our purchasing teams have the advantages of local
language skills, a full understanding of Chinese business
culture, protocols and etiquette,” explained Günther
Contact for Packaging Solutions
thomas.friedrich@sonydadc.com | Phone: +43 6246 880 196
10
the insider
Leitner, Manager Printwork and Components at Sony
DADC. “They carry out comprehensive quality checks for
hazardous materials and make sure that the highest European
& Green quality standards are attained. Moreover,
our dedicated teams can provide for the fastest possible
shipment conditions.”
Already, Sony DADC has completed a number of titles
with special packaging sourced from China. The results
have exceeded expectations – on top of the high quality
and environmental considerations, the Euro-Chinese
partnership has yielded cost savings of up to 50% for
Sony DADC’s customers.

ARccOS - 360° content security for your video assets
A large and growing audience is consuming content of video titles for free – by illicitly copying, ripping and
downloading it. This is a great cause of concern to many publishers: however when viewed in a different
way, the issue presents a new and large potential market for publishers. These viewers are expressing
interest in content and if guided and persuaded in the right ways, they can become valuable paying consumers
of a publisher’s product.
Developed by Sony DADC, ARccOS is one of the best established
and developed DRM solutions on the market.
It forms the focal point of the company’s strategy to turn
would-be pirates into paying customers.
Now, in a strategic move designed to take the system’s
capabilities to a new level, Sony DADC has teamed up
with Peer Media Technologies. Whilst Sony DADC is the
world leader in disc-based DRM solutions, Peer Media
Technologies brings a wealth of knowledge and experience
in the online sector. Together, the two companies
can provide a 360° content security solution for video
assets.
Carefully designed and externally audited processes in
all steps of the supply chain and for all interfaces ensure
that the risk of high quality content leakage is minimal.
Online video security
When combined, ARccOS and Peer Media Technologies’
services offer a co-ordinated and comprehensive challenge
to the piracy threats that are found on the internet.
Also, they can provide valuable statistical reporting
to clients regarding the extent of the piracy threat.
“By combining disc-based and online services, we support
our customers in addressing all the aspects of piracy
on many different levels,” remarked Dominik Engel,
Product Manager Video DRM at Sony DADC. “Sony
DADC is confirming its commitment to help customers
worldwide to grapple with the complexities of protecting
their works in both physical and digital forms by
completing our security offering.
“Through partnering Peer Media Technologies, we can
offer a single 360° solution for content security that inhibits
piracy on all levels. This comprehensive solution
is the most effective way to persuade casual pirates –
home copiers as well as downloaders – to become paying
customers,” he continued.
Product Manager Video DRM
dominik.engel@sonydadc.com | Phone: +43 6246 880 8572
ARccOS for Blu-ray
In other news from this business team, Sony DADC has
responded to demand for a dynamic DRM solution for
Blu-ray, similar to ARccOS for DVD, with frequent updates.
This development comes against a background where
industry insiders are claiming that existing DRM mechanisms
for Blu-ray have been circumvented and even
the system updates fail to provide the necessary level of
protection.
New from Sony DADC, ARccOS for Blu-ray Disc protects
against 1:1 copying onto BD-R and ripping from Blu-ray
Disc to an HD movie file or a standard definition format.
Through full compliance with Blu-ray specifications, it
assures compatibility and playability on all players, while
long-term security from hackers is made possible
through frequent system upgrades.
Whilst protection is comprehensive, Sony DADC has
kept in mind the needs of the publisher in developing
this new system. It provides an easy and seamless protection
workflow, meeting industry needs for fastest
possible turnaround times.
Furthermore, the publisher can determine the playback
characteristics of a copy from no playback to garbled
playback, disclaimers, trailers and even a link to the
official store site, which could generate new revenue
streams.
“Blu-ray has the potential to revolutionise the global
home video market, but to realise this potential it needs
a robust and effective DRM system, which is exactly
what ARccOS for Blu-ray Disc represents,” explained
Dominik Engel.
Sony DADC's 360° content security solution
addresses all aspects of piracy
Disc-based DRM:
ARccOS forms a focal point of the Sony DADC strategy
against piracy of video content, inhibiting the unauthorized
1:1 duplication of discs.
Internet intelligence and reporting
P2P notices and counter measures:
ARccOS and Peer Media Technologies' services are coordinated
to comprehensively challenge the prevalent threats
but also provide useful statistical reporting to our customers.
Accredited secure facilities:
Carefully designed and externally audited processes in all
steps of the supply chain and for all interfaces ensure that
the risk of high quality content leakage is minimal.
Awareness building/legal action:
To address consumer awareness of piracy, Sony DADC actively
supports anti-piracy organisations worldwide and collaborates
in awareness building programmes. There is of
course also a legal aspect to piracy. Where necessary and
appropriate Sony DADC will take up or support legal action
against facilitators of piracy, such as riptool creators, first
seeders and pirate sites.
the insider 11

Boost software and games sales with SecuROM
Today the games and software industry has become a multi-billion Euro international business. The nature and structure of software products lend themselves to
digital distribution, but at the same time present unique challenges. Digital distribution provides new sales models, which are extremely effective in generating
revenue streams that cost little to create and expand – models such as Try & Buy. But, the challenge facing software publishers in many markets is to enable these
business models within an environment based on Digital Rights Management (DRM). A range of software companies use Sony DADC’s SecuROM DRM system to
protect and market their most valuable assets.
Phase-6
Phase-6 is a publisher of vocabulary training software.
The company has successfully integrated SecuROM
within its leading software products.
“We from phase-6 are very satisfied with SecuROM because
the use of this Digital Rights Management solution
has increased sales considerably,” said Daniel Gorin,
CEO of phase-6. “On the one hand we use it to prevent
unauthorized mass duplication. On the other hand we
used SecuROM to offer a trial period to potential users
in order to reduce buying barriers.”
Product Manager Software DRM
david.berka@sonydadc.com | Phone: +43 6246 880 8938
12
the insider
Square Enix Europe
Having recently acquired UK-based PC games publisher,
Eidos, Square Enix Europe is a leading player in this lucrative
international market.
Square Enix Europe has chosen Sony DADC as its technology
partner and has applied SecuROM as its DRM
system to safeguard its physical and digital distribution
channels for all of its PC games titles.
Another key advantage for the customer in using Secu-
ROM Product Activation is the availability of an online
analytics platform, which yields valuable information
about media consumption patterns within their target
markets.
Maximum privacy and user security: TÜV
certifies SecuROM as “trusted procedure”
Further SecuROM related news tells us that SecuROM
has been certified as a ‘trusted procedure’ by influential
German testing institute – TÜV. German data protection
legislation is amongst the most stringent in Europe,
so SecuROM’s TÜV approval is significant well beyond
Germany.
“The digital distribution channel is becoming increasingly
important to a broad range of companies that
are attempting to establish their products,” commented
David Berka, Product Manager SecuROM at Sony DADC.
“Previously there was a trade-off between security and
accessibility, but no longer, with SecuROM we offer the
best of both worlds. Furthermore it’s appropriate to a
broad range of business enterprises from software to PC
games and home entertainment products.”
Oxford English Testing replaces serialised
printwork with electronic DISC KEY
Software security – or rather the lack of appropriate
security - can be a major source of lost revenue to some
organisations. If the software is not protected it can be
more easily copied and shared
within a peer group.
One solution has been to
supply the users with their
own unique serial key which,
once typed in, unlocks the
game’s security system and
allow users to enter. However,
this solution is not perfect:
most calls to technical
support lines are caused by
human error mistyping serial
keys into their PC.
Now, Sony DADC has introduced a new and radically
different approach that immediately removes this issue.
The new electronic DISC KEY is an invisible code which
is loaded onto the data side of the disc during manufacture.
The code can be read automatically by the PC, which
then automatically communicates with a Sony DADC
server to verify it before unlocking the game for the user.
International publisher Oxford English Testing (OET) use
CD-ROM’s and audio CDs as an addition to its education
packages and add CDs to the workbooks. With an
original disc, the student is provided with access to the
company’s examination website where they can complete
tests online as a part of their studies.
The developers have incorporated Sony DADC’s Electronic
DISC KEY onto their discs which provides one-click
access to the website once the disc is loaded in a PC.
Once loaded, the disc provides the option of either playing
the loaded material or linking directly to the OET
website, where the tests are located.
Clicking on the OET website button provides an open
weblink that starts the website and automatically inserts
an electronic code into the required field, removing any
risk of mistyping or incorrectly filling the fields.

Digital deliveries to
Sony Ericsson’s PlayNow Arena:
millions of tracks
As reported in the last issue of "the insider", Sony
DADC’s Digital Content Services team is working
closely with sister company Sony Ericsson.
One of Europe’s leading mobile telecoms companies,
Sony Ericsson has meanwhile created access for customers
to its online music portal – PlayNow Arena in 18
territories in Europe. Further rollouts with a global scope
are prepared for Latin America and Asia Pacific territories.
The platform, which is supported by the Digital Content
Services team at Sony DADC, provides a wide variety of
downloadable music and ringtones.
The music is provided by all major and some indie record
labels having a mixture of tracks on a global and local
scope. Sony DADC’s Anif-based team encodes all the
data and delivers the music files in all formats required
to the online portal www.playnow-arena.com.
Contact for Digital Content Services
karl.heisler@sonydadc.com | Phone: +43 6246 880 347
Pearl Jam
create an eBridge to their fan base
Universal Music’s CD release of the band’s new album Backspacer sees Pearl Jam pushing back the frontiers
of CD technology. Backspacer is not just a CD – it’s an eBridge CD using Sony DADC’s unique voucher number
technology.
This advanced music platform gives the band’s loyal fans
access to a wide range of bonus content after they have
registered on a special web portal.
After loading the disc into an internet connected PC,
the user is just one click away from a whole new world
of bonus material, which is provided free of charge by
the band.
Fans have a choice of two free downloads from a menu
of 11 Pearl Jam gigs that are hosted on the website.
The album will ship globally with eBridge technology
and initial worldwide volumes are very substantial.
“Pearl Jam’s fans are amongst the most loyal in the
industry and they have reacted very positively to this
new concept,” said Gerry Kelly, Business Development
eBridge at Sony DADC. “It’s a win-win scenario – the
fans receive some great performance recordings and
the band and record label are able to develop a deeper
relationship with their fans than would otherwise
be possible.”
This sophisticated online conditional access system integrates
Sony DADC’s eBridge analytics application, which
enables a wealth of information to be automatically
reported back to the client.
“In today’s multimedia world, music lovers expect more
than just great audio. This system exactly fits our needs
and has been very well received by the band and their
fans,” commented Jon Turner, General Manager, Island
Records.
Business Development eBridge UK
gerry.kelly@sonydadc.com | Phone: +44 7775 81 61 63
the insider 13

Dieter Daum receives Global Environmental Award from
Ryoji Chubachi (President and Electronics CEO, Sony Corporation)
Within the Sony Group of companies, Sony DADC is in
the first tier of environmentally aware business operations.
This was recognised last year when the company
received an Award of Excellence in energy conservation
and the prevention of global warming from Ryoji Chubachi,
President and Electronics CEO, Sony Corporation.
Effective manufacturing remains a key focus within
Sony DADC as well as energy conservation. Compared
with 2000 levels, the company has reduced energy consumption
per disc produced by 5%; CO 2 emissions have
fallen by 94% and water consumption per disc produced
has fallen by 10%.
New initiatives include the modification of production
equipment for optimised energy use, waste heat recovery
and re-use in heating systems and water saving
technologies in mastering & replication.
Another major initiative is ground water cooling at the
Anif site near Salzburg. The area is rich in water resources
and Sony DADC conducts a lot of measurements
to ensure of the safe sourcing the ground water and
uses it for cooling during the manufacturing processes.
Since 2001, this system has created CO 2 savings of over
6 tonnes and saved 33M kWh of energy in Anif. After
the success of this project, Sony DADC is extending
the energy saving measure to additional manufacturing
Contact for Green Manufacturing
maria.bauer@sonydadc.com | Phone: +43 6246 880 8018
14
the insider
Engineering a greener future
The Sony Corporation commits strongly to environmentally sustainable manufacturing and business operations. For decades the
company has lead the development of practices designed to reduce manufacturing’s carbon footprint. Last year saw Sony join the
WWF’s Climate Savers Initiative with a commitment to further reduce its carbon dioxide emissions by 7% before 2010.
sites. Currently, the company is introducing ground water
cooling in Thalgau as well.
On top of this, almost all of the waste produced by Sony
DADC is recycled, in addition to a major reductions in
the generation of waste throughout the company’s operations.
State of art facilities powered
with hydroelectric energy
Perhaps the most impressive CO 2 reduction has occurred
through Sony DADC’s decision to implement 100% renewable
energy sources, which once again harness the
abundant water resources around the production site.
“Our drive for environmentally sustainable business
practices is not confined to the production plant,” commented
Maria Bauer, Environmental & Sustainability
Officer at Sony DADC. “Every employee needs to be
aware of the need to save natural resources. Earlier this
year we set another target to achieve a further 10%
energy reduction within the office and administration
areas. We believe this will save a further 170,000 kWh
of energy each year, as well as around 650,000 sheets
of paper.”
Finally, Sony DADC has developed a number of environmentally
friendly packaging systems for its products.
Bend-it Green and eco-boxes (lightweight and thus material
saving) are two systems which have proved very
effective in reducing carbon footprint without compromising
the quality of the final packaged media product.

Carbon Footprint Savings of more than 50% *
Bend-it Green – the Eco-Packaging Line by Sony DADC
n 100% recycled or 50% recycled or FSC/PEFC certified material
n easy to use (bend out disc holder)
n no use of plastic
n cost efficient
n short leadtime
Award
Winner
Sony DADC | Sonystrasse 20 | 5081 Anif/Salzburg | Austria | Phone: +43 6246 880 555 | sales@sonydadc.com | www.sonydadc.com
Bend-it Green | Patent Pending *vs. tray-based packaging solutions **a non-profit company established to find ways to reduce the UK music industry’s greenhouse gas emissions
available for
CD and DVD,
one disc and
multi disc
versions
Music Industry Green Mark
by Julie's Bicycle **

Sony DADC Sales Network Europe
United Kingdom • Ireland
Sony DADC United Kingdom
Kent House
14/17 Market Place, 5th floor
London W1W 8AJ
United Kingdom
Siegfried Obermayr
Phone: +44 20 7307 9771
siegfried.obermayr@sonydadc.com
Robert King
Phone: +44 7919 330 734
robert.king@sonydadc.com
Paul Bishop
Phone: +44 2920 69 27 66
paul.bishop@sonydadc.com
Gerry Kelly
Phone: +44 7775 81 61 63
gerry.kelly@sonydadc.com
John Morrissey
Phone: +44 1420 47 00 45
john.morrissey@sonydadc.com
Roger Twynham
Phone: +44 7768 00 48 55
roger.twynham@sonydadc.com
France
Sony DADC France
140 rue Gallieni
92100 Boulogne Billancourt
France
Phone: +33 164 13 82 60
ulrike.lombard@sonydadc.com
Bertrand Levavasseur
Phone: +33 164 13 82 41
bertrand.levavasseur@sonydadc.com
John Mathews
Phone: +33 231 37 50 50
john.mathews@sonydadc.com
Simon Holpert
Phone: +33 164 13 82 43
simon.holpert@sonydadc.com
Sony DADC · Sonystrasse 20 · 5081 Anif/Salzburg · Austria · marketing@sonydadc.com · www.sonydadc.com
Austria • Czech R.
Slovakia • Slovenia
Croatia
Alexander Schwab
Phone: +43 6246 880 570
alexander.schwab@sonydadc.com
Benelux
Toon Bressers
Phone: +31 40 251 25 06
toon.bressers@sonydadc.com
Germany • Switzerland
Urs Staubli
Phone: +41 71 860 06 20
urs.staubli@sonydadc.com
Christian Adam
Phone: +43 6246 880 660
christian.adam@sonydadc.com
Christoph Diekmann
Phone: +49 221 510 70 90
christoph.diekmann@sonydadc.com
Greece • Cyprus • Macedonia
Bulgaria • Turkey
Yannis Saoulis
Phone: +30 6977 227 837
yannis.saoulis@sonydadc.com
Hungary • Romania
Istvan Zakarias
Phone: +36 30 950 50 29
istvan.zakarias@sonydadc.com
Italy
Massimo Boldetti
Phone: +39 02 3658 6005
massimo.boldetti@sonydadc.com
Spain • Portugal
Susanne von Bahr
Phone: +34 91 409 64 86
susanne.von.bahr@sonydadc.com
Stig von Bahr
Phone: +34 91 575 74 03
stig.von.bahr@sonydadc.com
Poland • Latvia • Lithuania
Lukasz Zwolinski
Phone: +48 661 02 0000
lukasz.zwolinski@sonydadc.com
Nordic Territory
Sony DADC Copenhagen Office
Sluseholmen 2-4
2450 Copenhagen
Denmark
Jesper Schertiger
Phone: +45 7070 27 25
jesper.schertiger@sonydadc.com
Michael Persson
Phone: +45 3694 46 31
michael.persson@sonydadc.com
Sony DADC Stockholm Office
Gåsgränd 3
111 27 Stockholm
Sweden
Matilda von Bahr
Phone: +46 8 442 92 06
matilda.von.bahr@sonydadc.com
Kristoffer Ellsäter
Phone: +46 763 250 187
kristoffer.ellsater@sonydadc.com
Leif Ellsäter
Phone: +46 763 060 012
leif.ellsater@sonydadc.com
Russian Federation
Sony DADC Russia
Prospekt 60-letiya Oktyabrya, 9,
bldg 2, office 506
117312, Moscow
Russia
Alexey Ugrinovich
Phone: +7 985 760 69 46
alexey.ugrinovich@sonydadc.com
Other European countries
sales@sonydadc.com
Phone: +43 6246 880 555
Sony DADC Distribution
Network Europe
Sony DADC Distribution UK
6 Solar Way
Innova Park off Mollison Ave
Enfield
Middlesex EN3 7XY
United Kingdom
Phone: +44 1992 65 7688
darren.houghton@sonydadc.com
Sony DADC Distribution France
Bâtiment n° 4
Le Parc Prologis Chanteloup
77550 Moissy-Cramayel
France
Phone: +33 1 64 13 82 11
camille.magro@sonydadc.com
Sony DADC Distribution Germany
Waldstraße 37
63128 Dietzenbach
Germany
Phone: +49 6074 498 100
michael.hechler@sonydadc.com
Sony DADC Distribution Italy
Silvano Chiapparoli Logistica Spa
Livraga "Deposito Livraga 2"
Via Cascina Nuova
26814 Livraga (LO)
Italy
Phone: +39 0377 986 450
dina.neto@sonydadc.com
Sony DADC Distribution Spain
Avda. Olímpico Fernandez Ochoa s.n.
Poligono Urtinsa
28925 Madrid
Spain
Phone: +34 91 59 68 487
jesus.valenciano@sonydadc.com
Sony DADC Distribution Nordics
Entertainment Network
Scandinavia AB
Viaredsvägen 24
504 94 Borås
Sweden
Phone: +46 33 20 61 01
stig.ingelstrom@sonydadc.com
Insider0209