DVD Demystified

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Chapter 2
the delay. Again, more pragmatic viewpoints appeared, such as that of Jerry
Pierce, director of MCA’s Digital Video Compression Center, who flatly
stated that “the DVD launch will be in 1997.” By this time Philips—the
most conservative of the bunch—had moved its release date to the spring of
1997. Matsushita also said its DVD-ROM drives for PCs would not be introduced
until early 1997 but that within 2 to 3 years every PC would have a
DVD drive.
At the end of July, over a month after a copy protection settlement was
to have been made, the DVD Consortium—the hardware side of the triangle—agreed
to support a copy protection method proposed by Matsushita.
The Copy Protection Technical Working Group—representing all three
sides of the triangle—agreed to look into the proposal, which used content
encryption to prevent movie data from being copied directly using a DVD-
ROM drive.
Not unexpectedly, licensing discussion had by now fallen apart. On
August 2, Philips made a surprise announcement that it had been authorized
by Sony to begin a licensing program for their joint DVD technology.
“In an effort to avoid further undesirable delays, Philips and Sony have
decided to move forward in the best interest of the DVD system and its
future licensees.” They called on other companies to join in pooling
patents, but Thomson, for one, declined. Many less-than-responsible journalists
had a field day, reporting that the DVD standard had been sabotaged
or that Philips and Sony were trying to steal patent revenue from
the other companies.
By the end of August, there was still no copy protection agreement. At
the gigantic CeBIT Home exhibition in Hanover, Germany, Jan Oosterveld
of Philips explained that key issues such as copy protection, regional
coding, and software availability were unresolved. “The orchestra is
assembled, the musicians have their positions, but they have not decided
which tune they will play and how much time they need to rehearse and
tune their instruments,” he said. He elaborated that copy protection was
complicated by export and import restrictions and that key technology
was still not available to non-Japanese companies. The regional control
issue—on the table for almost a year—still “created confusion on how the
world should be divided.” The software supply for DVD-ROM drives also
looked bleak, with only 12 companies working on DVD-ROM titles. Oosterveld
reiterated that the music industry was expected to take the lead
with DVD-Audio and that there was no decision on whether to use phasechange
or magneto-optical technology for DVD-RAM. Despite this,
Philips was optimistic that by the year 2000 around 10 percent of all optical
drives, or 25 million out of 250 million, would be based on DVD. Com-
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