CyberKey has added digital-rights-management technology to its line of USB flash drives, an improvement which has attracted the attention of a major music label interested in distributing pirate-proof music.
CyberKeys products are similar to the other small-form-factor USB drives made by tens of manufacturers around the world, with one difference: the manufacturer has added a digitally-encrypted serial number to the firmware.
The drive, or "key", looks and behaves similarly to other USB drives; users can read and write to the flash-based media as easily as a floppy or other disk. But software can also be loaded and run from the drive, and programmed to look for the unique serial number.
"If you take an application like Photoshop that comes on CD…you can go out there and copy it a million times, said Jim Plant, president and chief executive officer. "They [pirates] killed the software industry, and theyre killing the music industry."
The new technology will earn Plant a meeting with Ted Cohen, senior vice-president of digital development at EMI Recorded Music, which owns Capitol Records and Virgin Records. Artists signed by EMIs labels include The Rolling Stones, Garth Brooks, Norah Jones, Janet Jackson, the Beastie Boys, and Everclear.
Cohen confirmed that the two sides have been in contact. "We dont currently have a deal with them; we dont have a term sheet," Cohen said. "But he called yesterday…when he calls, I pick up the phone."
Cohen said EMI was interested in "totally secured DRM". "Thats something were looking for," he said. "If it works Id be interested in discussions and doing something with them."
Assuming the deal goes through, Plant said CyberKey was working on developing a website called ClubCK that would feature EMI-approved downloads.
EMI is not involved in the venture, however. "Thats totally their deal," Cohen said.
Although CyberKey is about a year and a half old, Plant said he was brought in to stage something of a turnaround. The company is currently reworking and repricing all of its drives, and hopes to add a 1-Gbyte DRM-enabled model by May 1 for about $600, Plant said.
Plant declined to comment on the strength of the encryption used in the USB drives, but said that the serial number uses "slightly stronger than conventional encryption". CyberKey licensed the ActiveDisk technology from Iomega Corp., which allows applications to be run directly from the USB drive. If a DRM-enabled application searches for and can not find the serial number, the application will not run, he said.
CyberKey also signed a deal with Aladdin Software, maker of the Stuffit file compression tool, to allow files to be compressed and stored on the drives.
"Our goal is to allow you to take your applications with you," Plant said.