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Issue 6: Signal Security

SATELLITE SIGNAL SECURITY
Copyright Protection
Korean DBS Content and Transaction Security

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Case Studies

Canada: There are two DBS providers in Canada licensed to provide encrypted subscription services: Star Choice and ExpressVu. Because the mass of Canadian citizens are clustered in the South along the border with the United States, the temptation is strong for some Canadian viewers to want to also access the spill over signals originating with the U.S. DBS providers DirecTV and EchoStar. But Canadian law "prohibits the decoding in Canada of any encrypted subscription programming signal, regardless of the signal's origin, unless authorization is received from the person holding the necessary lawful rights under Canadian law."[1]

In 2003, some 750,000 Canadians were thought to be using illegal satellite systems to watch pay TV programs originating in the U.S. When the Supreme Court of Canada reconfirmed in 2002 that the decoding of encrypted signals was unlawful, Canadian law enforcement agencies began seizing illegal equipment and leveling fines against violators.

The Canadians began an information campaign to justify to the public the reasons for the enforcement of the law. Canadian broadcasters estimated that the cost of black market satellite signal theft was costing them $450 million annually. Picking up the American signals meant that the competitiveness of Canadian broadcasting was undermined, making less funding available for Canadian producers, writers, artists, camerapersons, technicians and trades people. Canadian residents were warned that, if they were caught using the improper equipment, the service would be terminated and the equipment they had purchased would be rendered useless.[2]

United States: Beginning in 1996, when its first generation encryption system was hacked, the U.S.'s largest DBS provider DirecTV has taken an aggressive stand against signal pirates. Today, the company takes legal steps to prosecute businesses dealing in piracy equipment as well as residential users who purchased the devices.

Now owned by Rupert Murdoch's News Corp., DirecTV has about 12 million subscribers. It's approach to signal hacking has been to hire former FBI agents to uncover breeches of satellite security under the U.S.'s Digital Millennium Copyright Act. When violations have been found, equipment has been seized, mailing lists have been confiscated, web sites have been closed down and an electronic "cyber-strike" from space targeting illegal smart cards has been used to disable non-paying customers.[3]

DirecTV's security system gives it the ability to reprogram its subscriber smart cards remotely. By the same path, it has been able to search for and destroy illegal cards. By mid-2003, DirecTV had filed 8,700 lawsuits to protect against infringement of its signal security.[4]

EchoStar, the second largest U.S. DBS provider with some 9 million subscribers, does not talk publicly about its strategies to insure signal security. However, the company says it uses encryption technology that is periodically updated via satellite. These upgrades can only be received by paying customers. Like DirecTV, EchoStar employs people to monitor the Internet to look for evidence that its security codes have been broken.[5]

The World Wide Web has been the principal means by which the hacking community shares information and sells its smart card reprogramming equipment.

Thailand: A lot of pressure is being put on pay TV operators by the big Hollywood-type studios to protect the copyright of films. One of the Motion Picture Association's strategies for coping with cultural and intellectual property theft is to get the issue of copy protection on the agenda of international trade organizations.

Piracy of satellite signals - especially theft of pay TV programming - has flourished in Thailand. According to Cahners Business Information, some 300 pirate cable operators and about one million pirate cable households are paying US$10 per month in subscriptions. Where pirate operations have been shut down by police, as many or more have opened for business since the demand for this product is high and money can be made when fees need not be paid to copyright holders.[6]

The dominant pay TV provider in Thailand is United Broadcasting Corporation offering 48 channels, including 6 free-to-air services and 13 educational channels. In 2003, UBC's subscribers numbered about 420,000, close to the estimated financial break-even point of 450,000 subscribers. But UBC says its paying subscribers are not growing; rather the numbers are declining. This is due largely to signal theft and the discounted prices being offered by the illegal operators that rely on UBC delivered content.

UBC has appealed to US programmers to help reduce pay TV piracy in Thailand by lobbying to get intellectual property protection on the agenda of trade talks between the US and Thailand. This strategy is thought to be a more visible and perhaps practical way to get the attention of the Thaksin Shinawatra government.

France: Paris-based Thales is a large electronics company in the business of providing infrastructure and transaction security for IT and related services. Canal Plus Group has selected Thales" DTV Security Service platform, ThalesCrypt, to secure and protect its satellite feeds. ThalesCrypt offers a modular end-to-end solution that includes a scrambler, a receiver/descrambler and rights management software that Canal Plus will use in the distribution of its programming to authorized cable head-ends.[7]

WorldSpace: Digital satellite broadcaster WorldSpace has developed a plan to increase revenues by expanding its audio and multimedia broadcast business to include electronic transactions and services. Many of the value-added services under consideration by Worldspace, such as e-commerce, e-health and e-education, will be subscription-based and will require that signal security procedures be added to its current free-to-air broadcast services.

WorldSpace has entered into a security contract with WISeKey, a technology and software vendor with the tools for protecting data exchanged among business partners and providing for digital identification. The WISeKey infrastructure supports interoperability within a global network of Registration Authorities in more than 100 countries that will permit WorldSpace to address the communication needs of both private and public organizations within the large footprint of its regional satellites. WorldSpace satellites are particularly well positioned to provide services to Africa, the Middle East, Asia and Europe.[8]

Lessons for Korean DBS

The sole direct broadcast satellite provider in Korea is SkyLife, a commercial business sponsored and managed by the government-owned Korea Broadcasting System (KBS), the recently privatized national telephone and telecommunications service Korea Telecom (KT), the Munhwa Broadcasting Corporation (MBC), and others in a consortium called the Korea Digital Satellite Broadcasting System (KDSB).

SkyLife was launched in March 2002. Two years later, the DBS provider could boast in excess of one million subscribers. SkyLife is principally a Pay-TV subscription service but is also advertising supported. In 2003, it initiated Korea's first interactive TV service (offering home shopping, banking, games, weather reports and daily news on-demand) and in 2004 launched the country's first HDTV service.

The exceptional growth of the DBS provider, indeed the very existence of the consortium of private companies and public agencies that serve as its shareholders and appoint its management team, is a direct outgrowth of Korea's new Broadcast Law of 2000. The Broadcast Law serves to not only provide for deregulation and privatization of media and telecommunication sectors, but also to seek accelerate development of Korea as a knowledge society.

DBS springs from national policy in Korea giving priority to those activities that enhance economic development, support Korean culture , and provide for a more balanced development of national media, whether broadcast, cable or satellite.

In Korea, protection of the satellite signal is thought of as a matter of national priority in Korea for the reasons that a successful DBS service will be a major contributor to: 1) insuring quality programming distributed nationwide; 2) stimulating locally originated content and content production; 3) adding value to products and services and increasing consumer choices; 4) building future-oriented jobs and providing for job training; 5) positioning Korea more directly in the path of the global super highway.


REFERENCES

  1. "Satellite Piracy: Government of Canada to Propose Legislative Amendments," Industry Canada, September 5, 2003, www.ic.gc.ca/.
  2. "Buyer Beware: Industry Canada Cautions Canadians Against Buying Illegal Satellite Systems," Industry Canada, December 17, 2002, www.ic.gc.ca/.
  3. Kevin Poulsen, "DirecTV Attacks Hacked Smart Cards," The Register, January 25, 2001, www.theregister.co.uk/.
  4. Kevin Poulsen, "DirecTV Dragnet Snares Innocent Technies," The Registrer, July 17, 2003, www.theregister.co.uk/.
  5. Meg McGinty, "DBS Smarts From Hack Attacks," Inter@ctive Week, February 14, 2000, pp.1-2.
  6. "Trading Floors: US Programmers May Have More Success Eliminating Pay-TV Piracy in Thailand," Cahners Business Information, Television Asia, October 2003, www.lexis-nexis.com/.
  7. "France: Canal Plus To Use Thales Encryption System," British Broadcasting Corporation, December 12, 2003, www.lexis-nexis.com/.
  8. "WISeKey Partners With WorldSpace.com," PR Newswire Association, Inc., October 16, 2003, www.lexis-nexis.com/.

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