Intertrust and Natwest Team On Copyright Protection

Computergram International, June 4, 1999

Security firm InterTrust Technology Corp and the UK's National Westminster Bank Plc yesterday announced their partnership in the launch of Magex, a copyright protection and online distribution service which combines InterTrust's 'digital envelope' technology with NatWest's clearing house and banking systems.

The system, when it becomes available in October, hopes to let digital content providers, such as record companies and business information providers, control the revenues created by the distribution of their intellectual property. Items of data, say music files, are wrapped in a layer of code, the digital envelope, named the 'DigiBox', which contains the business rules under which it can be copied, viewed and, inevitably, paid for. A content provider creates these rules using a drag and drop GUI, which also allows time-dependant rules, such as discounting after a certain period. News group Reuters has already expressed support for the system, and is acting as a test dummy for pilot period.

At the consumer end, a user has to register his or her details, including credit card information, with Magex, but this needs be performed only once. This, coupled with the "trustworthiness" of NatWest as a bank, should reduce the public's fear about giving out details over the net, says NatWest. A 'digital wallet' is placed on a user's desktop, which stores payment information as and when the user accesses the DigiBox-wrapped data. Different prices could apply for viewing once to permanently keeping. The digital wallet would pay the vendor, via their Magex account, at some point in the future (details are fairly sketchy as to at what point this occurs).

The system, despite being administered by a British bank, works entirely in US dollars, at customer-facing and back ends. So if the system takes off, the dollar would soon become the internet currency of choice. Being a global system, vendors and users ali ke do not need to be banking customers of NatWest.

Some elements of the system are still vague. The issue of whether a buyer of an audiovisual file could transfer it between PC and laptop, or PC and, say Diamond Rio player, would seem to depend entirely on whether the vendor wishes that transfer to take place. Magex says it will attempt to counter that lack of flexibility at some point in the future by developing a smartcard system to transfer details between devices. NatWest announced last month it was creating a smartcard company, Platform Seven, to explore such technologies.

Magex will make money from the system by charging a one-off software license fee to vendors (price as yet unknown), as well as a negotiable transaction fee which will be percentage-based. This is likely to be less than 10% of the transaction value. Also left fairly vague after the announcement in London yesterday was what kind of rescue strategy would be needed in the inevitable event of hackers figuring out how to extract data from DigiBoxes and 'turn off' digital wallets.