December 6, 2002

Joint Proposal from MPAA and 5C Companies
for Table A Criteria

This proposal is being made to the Commission to suggest criteria for adoption by
the Commission to authorize digital output and recording technologies for Table A.

Notes:


Authorization of a given technology will generally require the inclusion of
"Associated Obligations" (as defined below) in Table A, which will pertain to the
use of that technology by a Covered Product to protect Unscreened Content or
Marked Content against unauthorized redistribution (including unauthorized
Internet redistribution).


This proposal contemplates that the criteria set forth below will be used in
connection with processes to be determined by the Commission for adding
technologies to Table A after adoption of the regulation promulgating the
compliance and robustness requirements. Notwithstanding, the proponents
recommend that the Commission authorize technologies for protecting digital
output and recording of protected DTV content, in such manner that the
Compliance and Robustness Requirements do not take effect prior to the
authorization of technologies that enable such content to be passed and recorded
in accordance with the Requirements.


This proposal recommends that the Commission address the following issues:

i)
A process by which (a) a party can file a notice demonstrating that
any of the criteria is met, which notice would, where applicable,
specify which companies have used or approved a technology as
contemplated in the criteria; (b) each company named in the notice as
having used or approved a technology is given adequate opportunity to
dispute the facts alleged in the notice with respect to such company's
use or approval, and (c) any such disputes can be swiftly resolved.
ii)
A process by which (a) a party can file a notice seeking
information as to whether one or more companies have "used" or
"approved" a technology, as "use" and "approval" are defined below;
and (b) each company named in the notice is required to respond as to
whether or not it has "used" or "approved" the technology.
iii)
A process for ensuring that a listed technology that has been
significantly compromised in relation to its ability to protect
Unscreened Content and Marked Content from unauthorized
redistribution (including unauthorized Internet redistribution) will not
be used as a technology for "at least as effective" evaluation pursuant
to criterion (3), below.

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iv)
A standard by which a technology could be removed from the list
where such technology has been compromised (where the level of
"compromise" is substantially higher than the level required for the
process contemplated in paragraph iii, above), which standard would
take into account the protection of Unscreened Content and Marked
Content from unauthorized redistribution (including from unauthorized
Internet redistribution), and the impact on content owners, consumers
and manufacturers resulting from the continued use of such
compromised technology and from any removal of such technology
from the list. This proposal recommends that the Commission will
address a process by which (a) requests can be made to remove a
technology from the list on the basis that such standard has been met;
(b) interested parties can object to such requests for removal; and (c) a
timely determination would be made as to whether or not such
technology will be removed from Table A (after a reasonable grace
period).
v)
The appropriate entity or entities that would administer Table A
and the processes described above.


This proposal also recommends that the Commission address the issue of the
applicable grace period before the Compliance and Robustness Requirements
become effective.

Definitions for capitalized terms not otherwise defined herein will need to be
defined.


Proposed Criteria:

A technology may be added to Table A by meeting any one of the following criteria:

(1) 3 Major Studios and/or Major Television Broadcast Groups (of which at least 2
must be Major Studios) use or approve the technology;

(2) 10 Major Device Manufacturers (including software vendors) have licensed the
technology and 2 Major Studios use or approve the technology.

(3) The technology is at least as effective at protecting Unscreened Content and
Marked Content against unauthorized redistribution (including unauthorized
Internet redistribution) as is any one of the technologies then listed on Table A
(other than technologies then deemed to be "significantly compromised" pursuant
to the process contemplated in clause (iii) in the note above). A determination of
whether a technology is "at least as effective" requires consideration of the
effectiveness of both the technology and any applicable license terms relating to
security (i.e., output and recording controls), enforcement and Change

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Management.
1
For purposes of this criterion, at the initiation of the licensor of the
technology or of another company, a public notice will be issued providing 60
days for comment on the request to include such technology on Table A. In the
event that the licensor of such technology is not the initiator of the request and
objects within such 60-day period to the inclusion of such technology on Table A,
then such technology shall not be included on Table A. In the event that the
licensor of such technology does not object within such 60-day period but 3
Major Studios and/or Major Television Broadcast Groups object, during the 60-
day public notice period, to the inclusion of such technology on Table A on the
basis that such technology does not meet this criterion, the matter shall be
resolved through an expedited process (not to exceed an additional 45 days) to
determine whether or not the criterion is satisfied. In connection with such
determination, evidence that the technology is in legitimate use in a Major
Commercial Market in connection with the output or recording of a commercially
significant amount of New Release Content shall weigh in favor of a
determination that such technology is "at least as effective" as a technology then
on Table A, provided that if such technology has not been so used in connection
with a commercially significant amount of New Release Content, such fact shall
not be weighed against a finding that such technology meets such "at least as
effective" standard.
2
In the event that there are fewer than 3 Major Studios and/or
Major Television Broadcast Groups that so object within the specified period of
time (and the licensor of the technology does not object) or if the result of the
expedited process is a determination that the technology meets this criterion, then
the technology will be included on Table A. If the result of the expedited process
is a determination that the technology does not meet this criterion or the licensor
of the technology objects, at any time prior to the conclusion of such process, to
the inclusion of its technology on Table A, then the technology will not be
included on Table A. For purposes of satisfying this criterion, if any Major
Studio or Major Television Broadcast Group is counted as objecting to the
inclusion of such technology on Table A, no Affiliate of such counted entity may
also be counted as so objecting.

(4) The technology (together with its license terms) includes output and recording
controls that protect against unauthorized redistribution of audiovisual content
(including unauthorized Internet redistribution) and such technology was
expressly named as being permitted to be used for the output or recording (as
applicable) of audiovisual content (except where such permission does not extend

1
The proponents understand that other parties may support the establishment of additional or variations of
the objective criteria for this criterion 3. The proponents look forward to discussing such proposals with
such other parties in greater detail.
2
By way of example and not limitation, a technology shall not be deemed to be in use "in connection with
the output or recording of a commercially significant amount of New Release Content" if: (i) such use is
solely for internal testing or other evaluation of such technology (including but not limited to testing or
evaluation in the form of limited-duration "beta testing"); (ii) the company or companies that use such
technology demonstrate their intent to use such technology solely outside the United States; or (iii) such
use relates solely to the non-commercial distribution of audiovisual content, such as distribution solely to
professional devices or for internal distribution within a company (including its Affiliates).

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to use in connection with New Release Content) under the license applicable to a
technology listed on Table A (whether such license itself expressly names the
technology or references another means by which such technology may be
expressly named), either (a) at the time such listed technology was listed on Table
A, or (b) at a later date, provided that a Change Management process applied to
such subsequent naming of such technology and such subsequent naming
complied with such Change Management process.

A failure to satisfy any of the above criteria shall not preclude the subsequent addition of
the technology to Table A pursuant to that or any other criteria.

For purposes of criteria (1) and (2) (and for no other purpose, e.g., not for purposes of
patent law), a company shall be deemed to have "used" or "approved" a technology (a
"Proposed Table A Technology") only if such technology (together with its license
terms) includes output and recording controls that protect against unauthorized
redistribution of audiovisual content (including unauthorized Internet redistribution) and:

(a) such company or, where such company is a Major Studio, any of its Qualified
Affiliates, has signed an agreement with the licensor of such Proposed Table A
Technology that expressly authorizes (including, for avoidance of doubt, via license
grant, non-assertion covenant or other authorization) the company or any of the
company's Qualified Affiliates (either immediately or upon a specified future date or
circumstance) to use or cause the use of such Proposed Table A Technology in a Major
Commercial Market, in connection with the output or recording (as applicable) of
audiovisual content (except where such authorization does not extend to use in
connection with the company's New Release Content), provided that the use of such
Proposed Table A Technology was expressly provided for in such agreement at the time
the company enters into such agreement (whether such agreement then permits the use of
the Proposed Table A Technology or then specifies a future date or circumstance upon
which such use of such Proposed Table A Technology shall be permitted), and provided
further that such "use" or "approval" shall not be deemed to exist prior to the effective
date of any right to use such Proposed Table A Technology under such agreement;

(b) such company or, where such company is a Major Studio, any of its Qualified
Affiliates, has entered into a content license or similar content-related agreement that,
upon signature (and not pursuant to a Change Management procedure), expressly
identifies, either directly, or indirectly by description or reference, such Proposed Table
A Technology (i.e., by expressly naming such technology in such content license or
content-related agreement or, indirectly, by expressly naming such technology in a
specification, standard or license that is directly or indirectly linked by explicit reference
through one or more instruments to such content license or content-related agreement) as
being permitted to be used for the output or recording (as applicable) of the company's
audiovisual content (except where permission does not extend to use in connection with
the company's New Release Content);


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(c) such company or, where such company is a Major Studio, any of its Qualified
Affiliates, has signed an agreement with the licensor of another technology for which the
applicable license specifically permits the use (either immediately or upon a specified
future date or circumstance) of the Proposed Table A Technology in a Major Commercial
Market in connection with the output or recording of audiovisual content (except where
such permission does not extend to use in connection with the company's New Release
Content), provided that the use of such Proposed Table A Technology was expressly
provided for in such agreement at the time the company enters into such agreement
(whether such agreement then permits the use of the Proposed Table A Technology or
then specifies a future date or circumstance upon which such use of such Proposed Table
A Technology shall be permitted) and provided further that such "use" or "approval"
shall not be deemed to exist prior to the effective date of any right to use such Proposed
Table A Technology under such agreement;

(d) such company has issued an unambiguous public statement endorsing the Proposed
Table A Technology for the output or recording (as applicable) of the company's
audiovisual content (except where such endorsement does not extend to use in connection
with the company's New Release Content) or the inclusion of the Proposed Table A
Technology on Table A; or

(e) a General Counsel or equivalent legal representative of such company has approved in
writing the inclusion of the Proposed Table A Technology on Table A.

By way of example and not limitation, a company shall not be deemed to have "used" or
"approved" a technology if: (i) its use or approval relates solely to internal testing or
other evaluation of such technology (including but not limited to testing or evaluation in
the form of limited-duration "beta testing"); (ii) notwithstanding any contractual right to
use such technology for New Release Content, the company demonstrates that it uses and
intends to use such technology under such contract solely in connection with content
other than New Release Content; (iii) the company demonstrates its intention to use or
approve the use of the technology solely outside the United States; or (iv) its use or
approval relates solely to the non-commercial distribution of audiovisual content, such as
distribution solely to professional devices or for internal distribution within the company
(including its Affiliates).


An entity that is counted to satisfy a criterion cannot be counted more than once
in satisfying that criterion.

For purposes of satisfying criterion 1 or 2, if an entity is counted as a Major
Device Manufacturer, Major Studio, or Major Television Broadcast Group (each, an
"Industry Category"), no Affiliate of such counted entity may be counted in the same or
any other Industry Category, except that (a) if an entity is counted as a Major Device
Manufacturer, 1 Affiliate of such counted entity may be counted as either a Major Studio
or Major Television Broadcast Group; and (b) if an entity is counted as a Major Studio or

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Major Television Broadcast Group, 1 Affiliate of such counted entity may be counted as
a Major Device Manufacturer.

"Affiliate" means, with respect to any entity, any corporation, partnership or other
entity that, directly or indirectly, owns, is owned by, or is under common ownership with,
such first entity, for so long as such ownership exists. For purposes of the foregoing,
"own," "owned" or "ownership" shall mean holding ownership of, or the right to vote,
more than fifty percent (50%) of the voting stock or ownership interest entitled to elect a
board of directors or a comparable managing authority.

"Change Management," for purposes of these criteria, means a process by which
content owners are provided a specified right or ability to meaningfully object to
particular amendments to content protection agreements.

"Major Commercial Markets," for purposes of these criteria, means the United
States, any country within the European Community, Canada, Japan and Australia.

"Major Device Manufacturer," for purposes of these criteria, means any member
of CEA, ITI, BSA or CCIA, the total gross revenues of which from device manufacturing
and software publishing exceed US$______________ per year.

"Major Studio," for purposes of these criteria, means, during the course of any
year, any member of the MPAA or any other company that has generated U.S. box office
revenues from theatrical releases of feature films in the immediately prior year that are at
least as great as the MPAA member company with the lowest U.S. box office revenues
from theatrical releases of feature films for that same year.

"Major Television Broadcast Group," for purposes of these criteria, means the 4
largest broadcast networks and the 5 largest television station groups that are not
affiliated with Major Studios.

"New Release Content," for purposes of these criteria, means, with respect to the
application of any Proposed Table A Technology to audiovisual content, audiovisual
content owned or acquired by license (with the right to determine distribution methods)
by a Major Studio and first commercially released during the 24-month period preceding
such application of such technology to such audiovisual content.

"Qualified Affiliate" means, with respect to a Major Studio, (a) an entity that
directly or indirectly owns and controls such Major Studio or (b) an Affiliate of a Major
Studio authorized to distribute the preponderance of the New Release Content owned or
licensed by such Major Studio for one or more of the major content distribution channels
(i.e., theatrical, home entertainment, pay-per-view, video-on-demand, pay television,
basic cable or broadcast television). For purposes of the foregoing, "own" shall mean
holding ownership of, or the right to vote, more than fifty percent (50%) of the voting
stock or ownership interest entitled to elect a board of directors or a comparable
managing authority.