What's DRM? Digital Rights Management Explained

Digital rights management (DRM) is a set of technologies, tools and techniques to protect your copyrighted digital content from unauthorized copying, sharing or usage.

Content creators, organizations and distributors typically implement DRM to control access to their intellectual or sensitive property and ensure that it is only used by the terms and conditions they have established. It also helps companies secure their files and enables safe sharing, so they don’t land in the wrong hands.

DRM emerged from the explosion of piracy in the internet age. While internet piracy isn’t legal or ethical, it is convenient. (Hello, everyone who has already used ChatGPT and similar AIs.) What’s worse, most people find nothing wrong with it: 70% of users said there is nothing wrong with online piracy. The consequences of this are enormous:

• Over 71,000 jobs are lost in the US economy due to music piracy.
• Illegal book downloads have led to $315 million in lost revenue.
• Pirated videos get over 230 billion views each year.
• 22% of internet bandwidth worldwide is used for internet piracy.

To fight back against piracy, creators and publishers turn to DRM to protect their copyrighted material for digital media — but that’s not the only thing DRM helps with.

What are digital rights?

Importantly, digital rights management doesn’t apply solely to pirated content. In fact, it can play a part anywhere you have digital rights. DRM is critical to control user access to sensitive data and confidential information — something every organization has.

The techniques and tools used for DRM help ensure that only authorized users can access and use the data in a way that adheres to company policies and guidelines. It provides another level of security as organizations become more vulnerable to attacks.

Here is what you need to know about DRM and how it can protect your most important information.

How do you manage digital rights? Common strategies & components

Piracy is widespread and impossible to stamp out completely. Instead of spending all of your energy trying to stamp out torrent sites or catch all the bad actors, DRM allows you to make it challenging — if not impossible — to steal your material from the start.

DRM systems typically involve a combination of tools and technologies that restrict the use of sensitive materials, including:

• Encryption
• Digital watermarking
• Access controls
• Licensing
• Audit trails
• Expirations and revocations

Encryption

The top way that DRM protects material is through encryption. It keeps unauthorized users from accessing data, even if it’s intercepted during transmission or storage. Only authorized users with the right decryption keys and credentials can access protected content by encrypting the information.

(Understand end-to-end encryption plus types of data encryption.)

Digital watermarking

Digital watermarking involves embedding an invisible or imperceptible digital code or marker into the content or sensitive file. It can be used for multiple purposes, such as tracking, proof of authenticity and ownership identification.

When data and content containing a watermark are shared or distributed, the watermark can also help to:

• Identify the source.
• Provide valuable information about the content owner or creator.
• Serve as proof of authenticity for content, allowing users to confirm that the content is genuine and originated from an authorized source.

Licensing systems

DRM uses licensing systems to give creators and companies a flexible and controlled way to grant usage rights to users. These systems define the terms and conditions under which users access, copy, distribute or use copyrighted material.

Companies can configure DRM systems to provide granular access control and assign users different levels of permissions and access rights to users depending on their roles and responsibilities. Users only access the information needed to perform their assigned tasks, limiting potential misuse or human error.

(Read more about access control.)

Audit trails

DRM solutions track user activities, such as viewing, accessing, or modifying confidential information – all via audit logs aka audit trails. This auditing is critical to detect potential security breaches and policy violations and find the cause of a cyberattack.

Expirations & revocation

When users only need sensitive information for a limited amount of time, companies can set expiration dates for confidential information or revoke access to it when necessary. They can use DRM to remove user access when it’s irrelevant or their role changes within the organization.

There are a wide variety of tools and techniques that DRM uses, and it continues to evolve to protect material as piracy and cyberattacks grow. These DRM solutions help:

• Determine ownership and track usage.
• Control the devices, users and time periods content is installed and used.
• Put limits on views and access.
• Stop users from editing, printing, sharing, taking screenshots, and saving materials.
• Restrict IP addresses, devices or locations.

Advantages of DRM

DRM is becoming increasingly important as online piracy, torrent sites and peer-to-peer file exchanges continue to grow.

Protect confidential content

The primary objective of DRM is maintaining control over copyrighted material. As a result, DRM offers a wide variety of protection for various digital materials, such as music, videos, e-books and software. It helps organizations secure sensitive information and documents, such as:

• Strategic plans
• Confidential employee information
• Contracts

DRM gives owners control over their work in the digital era and avoids unauthorized use. It also keeps their work from being changed or altered in ways it is intended.

Support revenue generation

DRM supports many monetization models, including pay-per-view, rental and subscriptions. Creators and organizations can use DRM to ensure users pay for the content they consume, which leads to consistent and predictable revenue streams.

Stop unintended use

DRM enforces licensing agreements so that users must abide by how, when and even where the information can be accessed and used. It not only stops bad actors from accessing the materials but keeps employees and legitimate users from accidentally misusing sensitive data that could make your organization vulnerable.

Manage permissions

DRMs keep unauthorized users from reading sensitive or confidential files. It also helps authorized users share necessary files and data confidentially. The technologies and techniques are especially valuable in the healthcare and financial sectors that require regulatory compliance — especially concerning personally identifiable information.

Trace data leaks

Most organizations will face a data leak at some point. In fact, 45% of U.S. companies have already experienced one. Quickly finding and resolving data leaks is critical for maintaining security. Businesses can use DRM to identify potential sources of leaks, which in turn helps them take appropriate measures to address the issue and prevent future data breaches.

Industry compliance

Some industries, such as healthcare and finance, require tighter user access and protection to meet regulations. DRM helps organizations comply with standards related to protecting copyrighted content, intellectual property rights, and sensitive personal information. Organizations may face legal penalties and heavy financial losses when faced with the unauthorized distribution of content. DRM provides them with an extra layer of protection against these losses.

DRM challenges: balancing content protection & user experience

Online piracy is a lucrative business; bad actors will continue to find ways around DRM. As a result, the technology continues to evolve to continue to protect creators and organizations.

There are multiple possibilities for the future of DRM.

For example, some experts are experimenting with blockchain technology, where anyone can detect piracy with a decentralized network of worldwide leak-detection agents. Also, artificial intelligence and machine learning will continue to enhance security and effectiveness.

DRM's future will revolve around control and usability for customers and users. While methods have improved, it does have challenges with:

• How intrusive it is
• How it downgrades user experience

While there’s too much financial investment at stake to abandon DRM for customer experience issues, organizations do need to find ways to avoid alienating users with too many restrictions.

As content expands across different platforms, interoperability will become more critical. Seamless content access and usage across other platforms, devices, and services will lead to a more consistent and user-friendly experience. Plus, it can help facilitate collaboration between content creators, consumers, distributors and other users.

Privacy is becoming increasingly important and relevant to DRM. Leaders will need to balance protecting data and to respect user privacy. This will likely involve implementing privacy-enhancing technologies to minimize data collection and still provide content protection and right management.