The keys to unlocking and protecting live sports revenues

0:04Nick Meacham:Hello, everyone. Welcome back to the next episode of Stringtime Sports. My name is Chris Stone. I'm the community lead joined as always by our CEO, Nick Meacham. Today, we're also joined by a guest, Olga Kornienko, who is the COO and co-founder of EasyDRM. And just before we got on stage, I'm always trying to figure out how I'm going to open things up. And Olga, you mentioned you spent the weekend building some IKEA furniture, which conveniently, Nick is currently in the home of IKEA. So Olga, I'm going to get to your experience over the weekend. But Nick, I want to know how much of your interior design furniture in your house in Sweden has come from IKEA.

0:37Chris Stone:Well, firstly, I'm also in the region of Smorland, which is actually where IKEA was actually founded. Not only the country, but also the region and not far away from where I live. I'd say so we're renting at the moment and we worked out that pretty much the entire house from kitchens to bathrooms to a good chunk of the furniture. is basically all from ikea so i think it's one of those things that when someone's deciding they want to rent a place out although renting is not that popular or common over here in comparison to some other countries that they've only just spent a few hours walking around that maze of a store and uh didn't walk out until they basically bought their the proverbial house uh full of uh full of stuff for it so yeah you can even see uh it's very easy to find things when they break though because you just go on and look them up so at least if you know where to look it makes it a big difference because there are some unique things.

1:29Chris Stone:Ikea can be a little bit like Apple sometimes where there's certain fittings and things that only really work with Ikea stuff. So it's good to know where to go, but it is still very much a destination here as well as it is pretty much anywhere in the world these days.

1:45Nick Meacham:And how did you do constructing yours, Olga? Because I'll be honest, in my household, I'm not the one that builds things. I do all the cooking. My wife does all the DIYs, so she's the handyman. She does everything. I certainly couldn't do it even with their step-by-step instructions. Were you able to build whatever piece of equipment or furniture you were building? So I grew up playing Legos and erector sets. And like I grew up in Russia and former Soviet Union. And I had the metal erector sets that if you didn't quite properly connect them together correctly, they pinched your skin and those sorts of other things.

2:21Love it. Love it. For me, Ikea is like Legos before adults. You let me go and I will put, like, I do that for fun, as said as it sounds. For me, putting together a kitchen, a whole closet system, off I go. Love it.

2:39Chris Stone:Well, my hand's been slapped a few times when I've tried to, when we have bought some stuff from Ikea. And I'm like, can I, maybe I can give that a go. And I quickly get told that, go back away from the Ikea furniture. It's mine. so uh i've learned the hard way to stay back in uh and let it magically appear the next day now i love it for me it's as i said it's absolute fun yeah well a little bit of lore about me not

3:02Nick Meacham:streaming related i remember i was about five years old big basketball fan my father's in the garage he'd built his own race car um and he asked me to come change the oil while i was shooting hoops and i remember i accidentally dropped the wrench from the used oil and then my dad was like just go back to shooting hoops like you're never back allowed and my dad swears this never happens but I'm like, dad, it's a memory I've remembered 30 years onward. So basically, I blame my lack of engineering skills on the fact that as a five-year-old, I dropped the wrench and my dad was just like, go, leave.

3:29Nick Meacham:Even though he's a mechanical engineer, can fix anything, I possess none of those skills. I said, it's never too late. You can start with IKEA and see where that takes you. We can, we can. Well, speaking of building things, we're going to talk a little bit around maybe one of the most important bits when it comes to constructing your streaming platform, your streaming service. And one of the areas, and this came up in our pre-conversation, is it recently feels like content protection is a larger part of the conversation than it has been in the past, partly because of how expensive rights are and maximizing your revenue streams from them.

4:04Nick Meacham:Or we look at things on the other side, like the falling out between DAZN and Ligun in France. One of the reasons was piracy is so rampant in the marketplace that DAZN couldn't drive enough subscriptions. And it just seems anecdotally, the more and more I go on to linked in the more i'm hearing about content security being a major point of emphasis for people in the space and that's one of the things that we're going to talk about today and you know as we're recording this there's the breaking news that you know ufc is now signed i believe it's a 7.7 billion dollar deal um with cbs and paramount plus so i'm sure paramount plus taking on those sets of rights will very much be looking at how they protect those because as we know combat sports has always been a big victim of piracy, given the fact that some fights could be less than a minute long and you better be pretty good about protecting your content.

4:53Nick Meacham:So it just seems to be a content or a topic that's continuing to come up more and more. So Olga, we're hopefully going to learn more about this space and sort of where it needs to fit within the streaming. Your build, your setup is also how do you maximize the revenue from protecting your content. So that's really what we're going to talk about today and hopefully gain some more insights from you on this particular topic. And Nick, I don't know if there's anything else you want to frame this, or if I've gone on a long enough soliloquy before we go and jump into it.

5:19Chris Stone:Look, I think you've covered it pretty well. I think there's a load of aspects to this topic that we've not had a chance to cover. And particularly as you're seeing sports properties and broadcasters looking at more ways of distributing content rather than just single channel approaches these days. It's even more important than ever to know where and how your content's being accessed and distributed and protected. Otherwise, you're probably leaving a lot of opportunity, a lot of revenue on the table, and having a very leaky ecosystem that is not going to, when we see profits and profitability of streaming being such a key part of everyone's challenge in this space right now, there's one thing you can really focus on that can help that tangibly.

6:06Chris Stone:And that's what hopefully we're going to get a little bit more about today. Well, we always look at security as a strategy. It can't be a, oh, you know, let me slap this on at the end kind of a conversation. Though the way we build our system, if you really had to do that, you can. But in the grand scheme of things, your approach to security has to be a strategy. Ideally, glass to glass. But that doesn't mean that the moment you decide to just do security, you have to do everything. Basically, we as EasyDRM started over 20 years ago doing specifically DRM. When we first launched, we decided to take the approach of let's do DRM in the easiest way to handle it, where we have an API for encrypting content and an API for playback, and we leave everything else behind the scenes.

6:58And we've been doing it successfully for, as I said, almost 20 years. And that's where usually people start. I kind of equate DRM to the lock on the front door. You don't want to put the cheapest lock on the front door. You don't want to go by the price because at the end of the day, the cheapest lock on the front door of your own house is probably not the greatest idea in the world. But the lock on the front door, if we start to take it to the security of, you know, our homes kind of a perspective, that's not the only thing we need. a camera that looks to see who's coming and going and various other parts of it and so on and so forth so recently we've been looking at various other aspects of security as well adding on to the drm bits but yes there is a lot of it and you can just take a point and start there and um grow on slowly but carefully and without you know rushing into a crazy expensive solution because at the end of the day our experience is that a lot of people like people understand that there's piracy and but sometimes it's kind of hard to put a finger on how much it is what percentage it is and also sometimes people look at security just as an expense which is something else that i think the mind is shifting and people are seeing that their content is popping up on all this other in other places.

8:23I mean, piracy sites and all these other sites where the pirates don't really need to worry about hosting content, encoding content, packaging content, getting the right stages, take it. And DRM itself and by itself cannot withstand the onslaught of pirates. And now I'm guessing AI helping hack into all sorts of things and whatnot. So additional other things are coming into play. And we've seen contracts ask for more than just DRM.

8:55Nick Meacham:I will say, I love the analogy. And maybe I've just not paid, no one's ever, or at least I've not personally heard the house analogy. And to your point, like there's multiple ways, you know, we hear people talking about all these different things, you know, watermarking, passport, all these different things. I love that analogy there. Maybe specifically though, where does the DRM sit within that space in terms of where it sits within that overall process or that overall protection that you're going to build around your property? So DRM is like your, if you're going to stick to the house, it's the lock on the front door or in your regular, you know, we can all, we've all logged into bank accounts or whatever.

9:33It's your username and password. And based off of that, you know that DRM, in the grand scheme of things, DRM is a technology that says how you can use the content. Can you play it for how long? Can you cast it? If I'm watching it on my computer, can I have a monitor attached to it? And so on and so forth. And DRM in and of itself controls just that. the encryption that happens during the DRM process is a vessel, if you will, to get the rights onto the content. Usually in the workflow, it happens around encoding packaging. That's the first part where content is prepared. And then the second part of it, like we've all probably dealt with when you press play, as an end user, a license is delivered to the end user.

10:28And that is the second piece of it where you get to view the license. There's also a common misconception when people say my content is decrypted. The content is actually never decrypted. It is unlocked. Going back to my front door example, when you walk into a house or a hotel room, you open the door with a key or a key card, you never physically rip the lock off the door. Kind of sort of the same logic with DRM. You know that you have access to go into this specific spaces but you you know don't take the lock off the door and as a company we're also working on other things to make sure that hacking into DRM harvesting keys and all this other stuff is becoming more and more difficult but in the flow of the process it usually on the encoding side and pieces on the playback side because it is a two-part process.

11:20Chris Stone:So Olga when you describe that it makes complete sense it's importance and it's necessary necessity so why is it that not everyone uses it what what is the benefit of having DRM versus not you know I think part of it might be um some more of an older thinking of it's an expense um I've had I've also had people contact us and say hey we're trying to set this up but we've been trying to get this set up for a couple months now and it doesn't seem to work with a different vendor. We built our system in a way that we have a very straightforward process and then we partner with everybody. And we don't try to do everything ourselves.

12:05We have encoding packaging partners, we have player partners, and we make sure that we have integrations already pre-done with them in order to get going. We have a very transparent price and we want people to understand what is happening, how it's happening, what the parts are that are involved in the process. And I have seen cases where that's not the situation. I've had people be like, oh, this is how it works. We didn't understand because there was no proper documentation or whatever. or the price was so high we just couldn't or whatever the situation may be. And sometimes it's just another thing to think about and you just don't want to and you think you need to build it.

12:52So, you know, conversations of build versus buy come into play there as well.

12:57Chris Stone:So just take that question a bit of a sort of a step further. Obviously, the typical workflow, you've got the ingestion, the encoding, then the packaging and encryption going on. Then things get sent to the storage out there or wherever it's stored and then it comes back and there's an acceptance of access to the platform. That's kind of how, from what I understand, the process and flow to work like. Just what happens if they don't have a DRM there? What happens instead? Is that basically just the encryption is next to non-existent and that's why it's a problem from a security perspective? Or how does that happen if someone's not using it currently?

13:36Well, there's no DRM that the content is in the clear. That's what it's called. And it's not encrypted and not protected. I've had people say, well, I had a very long conversation with somebody doing fast channels who told me they don't need to do DRM on fast channels because it's ad supported. Okay, but you're still licensing this content and you're still playing this content. So what's to stop a completely different site from just taking it from you and running their own ads or doing something else? But realistically, I mean, people try to do tokenization, people try to do URL obfuscation and various other things.

14:17But at the end of the day, the content itself is in the clear. And absolutely nothing stops me from recording, just screen grabbing the content. At the end of the day, there is no technology in the world that would prevent me from putting a phone or a very good camera in front of my TV and recording it that way. It's nothing that stops you right now. Watermarking can help you track it down afterwards. But I think it all depends on what the company is trying to achieve. But if there's no DRM, it's going to be the same as watching this podcast after we're done. It's just going to be in the clear.

14:55Nick Meacham:Well, I think that's one of the challenges when we talk about content security is there's some people out there that rightly or wrongly will go with wrongly say it's a badge of honor. If someone wants to pirate my content, you know, that they can understand why an NFL or Premier League would want to protect their content. But there's some people out there that are like, hey, I would love for people to even know we exist and would love for them to if someone pirated our content, that means we finally made it. But, you know, you've sort of explained a little bit, but like in terms of the mentality of changing people to understand that this isn't something that is just a problem for the big whales in the ocean.

15:34Nick Meacham:It's also something that goes down to the lower ends of the ecosystem, sort of where there's misconceptions about that idea that just because I don't sit at a certain level that I don't need to be focusing on this is a problem for me. From my perspective, you are still paying to produce this content. you have the infrastructure to you know package it encode it um stream it you're paying for bandwidth you're paying for you know maybe you're doing your own player development you're playing paying everybody to get this content out there and sure absolutely um i know that for a while there were companies that were using piracy as a um a marketing tool but that only goes so far If all of your content is stolen and you're not making money off of it or you're not getting any return on investment, as my co-founder says, we're all a dot com, not a dot org, right?

16:27And in order for us to continue producing content, we need to be making money on it. So I think, and Chris, to your point, I think a lot of the conversation like that goes to, I think it's very expensive to DRM protect for somebody who is small. and I've been for the to those people I'd say do some research because prices for DRM are not what they used to be 10 15 20 years ago I'm not saying it's a race to the bottom but the prices are very reasonable and we and just like other companies or a good amount of companies do it based on usage so if this month you had a thousand views and next month you had 10 ,000 views and then $100 ,000 and then back to$1 ,000, you pay per usage and that becomes manageable and makes people feel more comfortable.

17:20Nick Meacham:And you mentioned you guys have been around for over 20 years now. In terms of the evolution, we are transitioning to a more streaming, heavy world. How have you seen the development of content security going from a world that was largely linear broadcast to now there's more streaming. Is that, you know, compared to linear, is it more complicated, less complicated, or just a completely set of different problems? You know, how have you seen just the evolution of content security over that period of time, particularly as we're transitioning basically from one medium to another? It's definitely a transition.

17:55And for on the content security side, I mean, if we go back 20 years, we had technologies 20 years ago that don't exist anymore. a lot of standardization came into play also which makes it so much easier for content rights holders to actually drm protect content and just secure content in general um the more and more we get into the world of streaming i don't know if there's going to be a point where we're all going to say there's just way too much content out there and i can't watch it and piracy drops i don't know we can all hope because there's just way too much stuff but i seriously doubt it and i think um just like us a lot more of the um security vendors are talking more and more about what content protection is studios are mandating it and as we shift into the world of streaming not only is it important to have secure content but also know where your content is coming from because knowing that the content you're watching is truly Disney or truly NFL and the scores you're watching and potentially betting on have not been changed and nothing's been modified with the stream becomes more and more important because then there's less concern about manipulating, I don't know, the game, manipulating content, and so on and so forth.

19:23Chris Stone:Olga, I'm just wondering, when you mentioned earlier about the fact that there's even when a request is made when someone's trying to log in or access there's even things like the screen recording of the experience, there's also the casting on the screen that you help authenticate. Can you just give us a snapshot of what are some of those things that might be a typical within the ecosystem there that might have to be authenticated that your clients are using? So in the world of DRM, most DRM technologies have a certain set of rules. And those rules depend on technology. But in the grand scheme of things, it is whether or not the content can actually be played.

20:08If it is in the browser, it's just one play and that's it. If it's on a mobile app, you can have content that can be played for a period of time. So think your, I don't know, Netflix, Hulu, pick your poison, you can buy a movie and watch it for 24, 48 hours, right? And then you, as the technologies allow you to control things like, can you cast, can you prevent unsafe monitors on analog connections, and so on and so forth. Those are the most popular ones, but at least in the world of like movies and so on uh those are also the kind of things that are dictated by rights holders so when people go out and sign a contract for the rights for streaming a movie they say you can do this you can do this you can do this but you cannot do that they can specify that for specific like for sd content you can do this but for hd content you can't you have to specify different encryption keys for different types of resolutions and so on and so forth.

21:20And if people are not sure what they can do, they can always ask their preferred vendor. I would say us, but I don't want to be presumptuous. But they can always ask us. We're very much open to saying, hey, here's what you what are you trying to achieve? And based on what you're trying to achieve, you should do this. You can do this. And you might want to think about doing that. but a lot of it is dictated by a the way the technologies are built and it's play ready from Microsoft wide buying from Google and fair play from Apple and also what the studios recommend or I don't know if in the sports world actually don't know if in the sports world if rights holders control what you can and cannot do to that granularity I think it's it's case by case

22:05Chris Stone:in a lot of instances on how how big those contracts can be depending on some of the companies you might talk about i think what's interesting hearing you talk about that olga is that um it sounds like therefore that when you we hear the discussion have a discussion around in sports about what warrants um requesting someone to pay a subscription for versus just making things for free one of the aspects of that can be the quality of the content whether it could be a multi-view whether it be high definition or 4k etc uh whether it could be um casting to bigger screens and so forth those layers i think are an interesting area where there are some major platforms doing that uh in sports i can think of a couple but i think for the this for some sports properties that maybe they worry about other features maybe like access to different types of pieces of content which is is i put an important part of the product mix but i don't think they often think about the those aspects the technological aspects to improve the actual user experience and maximizing the value of what they're buying is another way to add perhaps another product layer to it rather simply rather than I think I could imagine some people might find that really difficult to get their heads around if they were launching a product for a decent-sized audience what is that key differentiator they can offer in a more premium solution to the base model well and also I think the other part of it is I mean they're in the world of mobile devices, how many phones are there, right?

23:39Even if on the Apple side, it's probably easier, but still on the Android side, how many variations of Android is out there? So kind of keeping it more generalized and not going completely off the deep end of, you know, I'm going to make it this for this phone, this for this device, this for the, it becomes unruly. But having a certain basic set of features can probably differentiate a service, especially whether or not you can cast off your phone because that all of a sudden creates more of a lean back, watch the game or a race or what have you on your TV at home with your family and it creates a more of a different experience.

24:23But for that, this is why you go to a security specialist. We do this. This is what we sleep, eat and breathe and we can make recommendations and tell you that this would work or yeah this might be a bit tricky or because of the fact that you're trying to cast to whatever you know set of televisions not all of them support it yeah the example that

24:44Chris Stone:comes to mind chris that um i'm not sure how they approached it but i remember when the nfl launched their mobile only um like plus offering um and one of the things that stuck to me as well as also betting rights you see a lot of betting companies that will buy certain sets of rights right across the world is that how do they make sure that that stuff's not being used in other ways because otherwise it's just opening up the floodgates for someone basically buying a betting, accessing it free through betting platforms and then just casting it onto their devices. So it's just something that I thought that with the NFL example, I had always had that curiosity.

25:25Chris Stone:It's like, well, can't people just be casting it to their biggest screen in their house? I don't know what they did to mitigate that, but I would have expected they'd have to have considered that quite heavily. Well, some betting companies do use DRM on all of their content as well. Talking yet again from experience from a customer of ours, they do stream betting for football and American football. Sorry, I forgot about the audience for a second. And they do use DRM on everything. So I couldn't tell you what specific rules they're setting, if they're controlling the casting or not. But that was definitely a requirement from the NFL that if you're betting on content, you need to be able to control all of that.

26:07Well, and also, and if we're getting into betting and just in general watching content, knowing that the score is right and correct and knowing that nobody's modifying this is also becoming more and more of a conversation in the world that we sit in. and to that end there's a technology out there called um or not a technology it's a set of standards called c2pa which stands for coalition for content provenance and authenticity and in the grand scheme of plain english things that means knowing where your content comes from is it specifically from nfl or is it from joe bob at you know my nfl basement.com and also um knowing that since the NFL published it, it has not been modified.

26:58So C2PA attempts to answer those two questions. So then as a user, when you are watching a game, if you're paying for a game, especially if you're traveling, you know exactly what you're getting. You know that it's correct.

27:12Nick Meacham:I will say if the goal was to educate today, I'll put my hands up in the air if anyone's watching the video. I knew there were things like, for example, I can go on my phone and I can, on my Chromecast, I can connect YouTube. Can't connect Apple TV to it. I didn't realize that was specifically because of DRMs. So there we go. I at least now know I can walk away. The next time I try to cast something to my TV, I'll be like, gosh, darn you, DRMs. So at least now I know what that is. Don't blame them. We're just the messenger. Yeah, yeah. Not easy DRMs specifically, but just that is the set of technologies.

27:49Nick Meacham:That's Apple, though.