Digital Rights Management
A whole day of sessions was devoted to DRM. In the two I attended, it was clear that both formats will be launched long before the rights issues are fully played out. It was even suggested that DRM could be in flux for the next 2-5 years. How this might affect early adopters of HD DVD or Blu-ray is still anyone's guess.
If there are multiple DRM technologies, the panelists agreed that they must be able to work with each other in a predictable way to insure that the consumer does not run into a dead end while trying to access the program material. Apple has been remarkably successful with their iTunes service because it is fully integrated, with one company having tight control of the program material providers to insure compatibility at the consumer end. (It's worth noting that no one from Apple participated in any of the Digital Hollywood sessions; one audience member with experience in the company noted that Apple's policy is not to participate in such events!)
For the industry in general, DRM is far more complex. The whole DRM effort is aimed not only at protecting content, but making sure that this protection produces the required compatibility. Consumers shouldn't have to keep a mental inventory of what they can and can't do with the various products available to them. Can I record program A onto device B and play it back on device C? Will recordings be compatible with devices C and D? How about E? A scenario like that will discourage legal use of the content and encourage legally questionable practices.
With the definition of "fair use" still fuzzy in the digital age, and the consumer having certain expectations about what they can legally do with material they have legally acquired, the industry faces a big challenge in protecting its content while not alienating the consumer who ultimately makes that content profitable. Judging from the panels I attended, they've only just started down that road.