IEEE Technology and Society Magazine - March 2020 - 70

Szabo himself noted that smart contracts may have
applications to "content rights management," but digital rights management is rarely mentioned in the current literature on smart contracts. This article considers
whether and how smart contracts differ from digital
rights management, what problems and risks associated with digital rights management might also be faced
by smart contracts, and what smart contract developers
might learn from the fate of digital rights management.
Mark Stefik, one of the pioneers of digital rights management, describes the technology as follows in a 1996
essay Letting Loose the Light:
The term trusted system refers to computers that
can be relied on to do certain things. For example, suppose that a creator or publisher forbids all
copying of a digital work. A trusted system in this
context would reliably and infallibly carry out that
stipulation; no amount of shouting or coaxing
would coerce it to copy the work [4, p. 226].
A digital license would let someone exercise
certain rights, such as copying or printing a particular work. When a consumer asks to use a
licensed work, an authorization server or "digital
authority" - a program on a repository [a trusted
store of digital works] would check his or her digital license [4, p. 227].
Stefik realized that protecting copyright is not so
simple as keeping everything in a trusted repository. He
goes on to consider various ways in which copyrighted
works might be licensed, ways in which the security of
repositories might be compromised, and how so-called
"fair use" (or "fair dealing") exceptions to copyright
owner's control over works might be accounted for.
Back in 1996, it no doubt seemed reasonable enough
that these things could be addressed with further
research, and indeed researchers continued to work on
these and other problems into the 2000s.
By the end of the first decade of the century, however,
much remained to be desired of digital rights management. The fair use problem (among others) remained
unsolved, digital rights management was deeply unpopular with buyers of the material that it was supposed to
protect, and sellers like iTunes were giving up on it.
This article does not restrict itself to copyright
protection applications. Many of the issues faced by
digital rights management technology seem relevant
to all attempts to automate law using computers, and
at least some of the efforts made to address challenges in copyright protection suggest analogous
approaches in other applications to which smart contracts might be applied. At the same time, there are
obviously differences between copyright law and

other branches of law, which must be addressed on a
case-by-case basis.

How They Work
It should first be noted that some blockchain developers have proposed a form of "digital rights management" in which the blockchain acts as a kind of
copyright registrar. Systems such as Ascribe (https://
www.ascribe.io) and KodakOne (https://www.kodak
.com/AU/en/kodakone/default.htm) record the ownership of the intellectual property in a work in the blockchain. Schemes of this sort do not actively prevent
misuse of the works involved; they can act only as the
arbiter of a dispute over ownership of some intellectual
property (Kodak's system also actively crawls the web
looking for infringing uses of work recorded in its
blockchain). This article uses "digital rights management" to refer to kind of system envisaged by Stefik
and implemented by various companies in the 2000s,
which seeks to prevent copyright infringement from
occurring at all.
As outlined by Stefik, the basic requirement for a digital rights management system of this sort is a "trusted
system" that cannot be tampered with by its user, and can
be trusted to carry out instructions written in a "license"
associated with some protected digital work. The host of
a party might buy a license to play a song during a party,
for example, and the trusted system would ensure that
the song was played only on the day of the party.
In practice, the trusted system is either a hardware
device that cannot be modified using the tools accessible
to typical end users (such as a smartcard), or so-called
"obfuscated" software that is difficult to reverse engineer
and modify. Licences can be written in one of several languages that allow copyright owners to describe who can
use digital works and how, the best-known of which were
the eXtensible Rights Markup Language (XrML) and the
Open Digital Rights Language (ODRL).
In a smart contract system, the role of the trusted system is played by a blockchain. The blockchain (also
known as a distributed ledger) consists of a series of
blocks, each recording a set of transactions, such that
every new block is cryptographically linked to all previous blocks. Anyone can verify that the blockchain is correct by checking that the chain begins at a well-known
"genesis block" and that every block thereafter is correctly linked to the block before it. Modifying a block results
in either an invalid block or an invalid link, so that the
modified chain will be rejected by the verification procedure. In a cryptocurrency system, transactions represent
some amount of currency being transferred from one
account to another. The exact construction of the blockchain differs from platform to platform; the details for
each platform can be found in documentation available

IEEE TECHNOLOGY AND SOCIETY MAGAZINE

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MARCH 2020

https://www.ascribe.io https://www.ascribe.io https://www.kodak.com/AU/en/kodakone/default.htm https://www.kodak.com/AU/en/kodakone/default.htm

IEEE Technology and Society Magazine - March 2020

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