Until recently, the DRM business consisted mostly of struggling DRM Technology Vendors trying to sell their protection technology directly to reluctant Content Owners. The content owners didn't have the required technical expertise, were terrified of getting locked-in to the wrong solution, and wanted high security while consumers wanted high convenience. Given that kind of customer-supplier relationship, it's not surprising that companies which relied on DRM technology sales for their top line died more often than not.

But in 2004, some new trends helped the cause of DRM businesses. First off, content owners simply couldn't drag their feet any longer - there were "existence proofs" like iTunes showing that online distribution was actually doable. Secondly, standardization efforts and distribution intermediaries served to insulate content owners from the details of technology and the risks of startup mortality. Of these, the two biggeest are Microsoft and the Open Mobile Alliance. Both of these organizations - in different market segments, with different agendas - have laid out DRM technical requirements that third-party suppliers and manufacturers are expected to adhere to if they wish to participate in valuable content ecosystems.

As a result, the business of DRM has become, to a large extent, the business of ensuring that all of the suppliers and manufacturers can meet those technical requirements. The requirements are usually expressed as Compliance Rules that describe how a product is supposed to handle licenseable content, and Robustness Rules that describe how a product should resist attempts to crack the product so as to make it play unlicensed content.

Some companies, such as BeepScience, play into this market by delivering the client and server software required to implement DRM for consumers. Others, like Cloakware, work with suppliers to help them ensure their products meet the applicable Robustness Requirements.

Of course, media is not the only game in town. DRM for software is still needed, and while there is no 800-pound gorilla in this space, TryMedia and Softwrap have survived for many years in that space, so they must be doing something right ;-).