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August 24, 2007
Why Watermark? To Target Ads
Why watermark files in a non-DRM way? Possibly because you can build an ad-supported business model around the data watermarks return to you.
This interesting claim was put forward earlier this month by John McBride on ars technica. He points to a deal between Microsoft and Activated Content Corp. to license some of MSFT's non-secure embedded data technology inside music files. These data can identify what the song is and may even be able to trace its history.
So where's the ad opportunity? For person-to-person sharing there's an obvious "people who like A also liked B" scheme. If you share my musical tastes perhaps you'll also share my interests in movies, cars, fast food, etc.
For situations in which a tune is released by or through a commercial outlet the opportunities are more direct. If I show up with a copy of a song that was given to fans via something like a newspaper give-away, then perhaps that newspaper's competitors would like to entice me to switch? Or a tune offered as a free cell-phone download would give you a good clue as to which cell provider has my plan, with the possibility to market additional or competing cell services.
Would something like this work? Probably. Like any other marketing campaign it'd hit some wrong people and some right people and be sold and judged based on its success rate. I can't say that this is precisely what Activated Content has in mind, but I agree with McBride that this kind of thing is definitely coming.
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