Designing the Foundations of Information Society in Italy

Leonardo Chiariglione (, Giacomo Cosenza (Sinapsi), Roberta Enni (RAI),
Eugenio Prosperetti (Studio Prosperetti), Stefano Quintarelli (AIIP)



The grass-roots “Digital Media in Italia” group proposes innovative of actions [1] in the areas of DRM, broadband networks and payment systems to unleash the potential of digital media.

According to this proposal services providers should retain the freedom to adopt the technological solutions they consider best suited to their business while service users should be given a minimum level of service interoperability if they so request.

1. Introduction

All advanced countries promote a broad market for content, hoping to reap general economic benefits and trying to promote culture and citizen participation, to strengthen the national identity inside and outside the country’s borders.

With the arrival of digital technologies applied to the mass market and especially with digital content distrib­ution, technology has significantly increased its influ­ence on information and culture consumption, on the business connected to them and therefore on society itself.

To better exploit all perspectives of development embedded in digital media[1]., it is necessary to overcome roadblocks in three key sectors related to digital content:

These sectors are particularly difficult to analyse because technology constantly modifies the context. Global economic competition also plays a role because on the one hand exploitation of some proprietary technology triggers often unrealistic economic expectations for the future, on the other it motivates traditional operators to resort to protectionistic actions that simply delay market development.

The critical factors are identified as follows:

Italy, like all countries that are technologically advan­ced but do not have a large market for content, suffers from the current situation. Action should therefore be taken, in keeping with market forces and constraints ar­ising from international treaties. Otherwise, the distrib­ution of national content (which also represents nation­al identity) may become economically difficult and ref­lect negatively on other segments of the national ICT industry.

This paper illustrates the content of the proposal developed by a grass-roots movement called “Digital Media in Italia” ( The proposal has been published in September and it is now being presented and promoted in the political, industrial and commercial sectors of Italy.

2. The current digital media context

Digital technologies help creators and consumers con­nect along the value-chain. At the same time digital techniques for producing and distributing digital cont­ent modify substantially the value-chain traditional roles and operations. The importance of some compon­ents may increase or decrease while new players may carve a new role for themselves in old and new value chains.

The exploitation of the existing legislative context on the part of some rights holders has led to the failure of several attempts made in the last ten years to introduce new digital media value chains. Today, the prevailing tendency is to keep the modus operandi of traditional value chains as unchanged as possible. Technology plays a role in this, because proprietary technologies are typically used to retain control of content distribution. Unfortunately, these technologies may neutralise the innovation brought by digital technologies and remove conditions of use and interoperability that traditional value chains ensured.

The digital media landscape is amplified and strengthened by the global scope of Internet. Globalisation of digital production and distribution, coupled with a now pervasive Internet, allows the birth of global operators, who can achieve an unheard of power.

In this global setting, the small content-related enterprises of Italy cannot emerge at the international level. As a consequence, important aspects of the national culture and identity may be obscured by non-Italian phenomena.

3. The foundations of the proposal

The has the goal to maximise the flow of digital media, to stimulate and widen the market, by creating the conditions where known businesses can flourish and new businesses can be born. This requires simultaneous and coordinated actions in three different areas:

There is clearly a dialectic relationship between providers of content, network and payment services, and users of such services. The proposal is based on the following principles:

The balance point that proposes is that

In the following we call iDRM the interoperable DRM system outlined above. This will remove some of the bottlenecks that prevent the birth of a horizontal market where anybody can enter as a device manufacturer or provider or consumer of content and services.

This is a new approach not only in the Italian but also in the European environment. Indeed, both the new i2010 EU regulatory framework for communications and the new Audiovisual Media Services Directive in preparation do not consider interoperability as one of the top priorities to be addressed by new regulation. Therefore no new policy has been devised to harmonise the legitimate interest to introduce innovative business models and the common interest to access digital content such as advocated by the proposal. The European Commission is debating whether net neutrality issues and interoperability issues need regulation at all (two public consultations were launched on the matter in the past months).

An innovative policy based on iDRM – which represents the “necessary and basic condition” of the proposal – is to be integrated and supported by two further policies based on opening of networks and payment systems, as detailed below.

4. The proposal

4.1. An open DRM system

The key component of the proposal in this area is the availability of open technical specifications. These must be developed by a committee open to all affected parties and with the mandate, assigned by a national entity with the appropriate authority, to develop the specifications satisfying the following general requirements:

The openness of the specifications are also measured by the rules related to their use:

It is important to note that the European Commission is seeking input regarding regulations on audiovisual set top box specifications and whether these are to be included in the i2010 Framework legislation.

4.2. An open broadband network

This is based on the same general principle of maintain­ing the freedom of choice of network operators to dev­elop their digital media business through the means deemed more convenient. At the same time, network operators should be requested to offer a minimum level of interoperability, to trigger the development of a horizontal market of content. The proposal is articulated as follows:

Note that the specific service agnostic, bidirectional, non discriminatory Internet access identified by the proposal given by an operator with the same technical features of his commercial offer (e.g. bandwidth, except the fact that is best effort) is then to be considered the minimum service level that a user can buy from each operator.

The regulatory environment to enforce this part of the proposal is neither favorable nor unfavorable in Italy and Europe. The basic principles do exist and, on those, a careful mediation by the Commission and the national Regulators could bring the operators to define an agr­eement on the regulatory and technical elements which compose the proposal.

4.3. An open payment system

An open payment system must satisfy the following requirements:

In the proposal a consumer will be able to open “virtual accounts” managed by account service prov­iders. Accounts will be based on guaranteed monetary circuits such as credit cards, bank accounts, prepaid cards, etc. The state of the account will be aligned to the selected payment form at regular intervals or on demand thereby decreasing transaction costs.

Therefore the proposal has the following features:

The same governance rules that apply to the open DRM system will be needed to define and manage the open payment system specifications.

In the European Union, the Electronic Money directives are enacted in most Member States (includ­ing Italy). According to such directives, the Bank Authority of each State will authorise subjects who wish to offer electronic money services with the limit that credit services (e.g. loans) may not be offered in such fashion.

Therefore, transactions in electronic money must be based on a prior payment.

5. Use cases

5.1. DTT/Satellite broadcasting with pay services



TV viewer owning a device capable of receiving DTT/satellite content


content provider/aggregator with exclusive rights on certain content for DTT/satellite distribution


network operator or content provider/aggregator active in the DTT/satellite market



“rents” C’s broadcasting service or is “hosted” in C’s programming


manages and protects his content through iDRM


accesses B’s content using an interoperable device available in the CE market



iDRM must support all relevant business models (PayTV, PPV, etc.)


Interoperable DTT/satellite devices are available on the market

5.2. IPTV



subscriber of connectivity and IPTV services of B but not of C


network operator


network operator with exclusive rights on certain content provided to his subscribers as IPTV



interconnects to B for IPTV services


accesses C’s content through the same modalities and devices used when A accesses B’s IPTV service (once interconnected)


has a QoS that is the minimum between B’s and C’s QoSs



Interoperable IPTV devices are available on the market

5.3. WebTV



web user subscribed to B’s connectivity services


network operator


content provider with exclusive rights of web dis­tribution on certain content subscribed to D’s con­nectivity services


network operator



can make his services visible through public IP addresses and making use of standard TCP ports


  • Addresses C’s WebTV services (public IP addresses)

  • Interoperates with such service (standard TCP ports)

  • Enjoys content with Best Effort network transport



iDRM devices are available on the market


B and D have a form of interconnection (through peering agreements, Internet and third-party operators etc.)


QoS of access service selected by A must be “adequate” to the type of content provided by C


C must be able to obtain what is required to provide his content on the web at market conditions


If content is provided as pay content the economic relationship is direct between A and C.

6. Advantages of the proposal

6.1. Open DRM system

The following advantages can be mentioned:

6.2. Open network

The following advantages can be mentioned:

6.3. Open payment system

The following advantages can be mentioned:

7. Conclusions

So far many of the potential benefits of digital media have been slow to materialise. The current trend is likely to lead to a few global digital media operators none of which will come from a small-to-medium size country like Italy. This will have not only serious economic consequences to the country but will also lead to the loss of important element of the national culture and identity.

The proposal developed by Digital Media in Italia aims at creating a large – by today’s measures – digital media market where end-users will be able to choose between content and service offers that are either based on proprietary or on interoperable technologies. Far from being only to the benefit of end users, the proposal will provide opportunities for all players of digital media value chains.

8. Acknowledgements

This paper reflects the work of many people, besides those listed as authors, who have been active in the group.

Their contributions are gratefully acknowledged.

9. References

[1] Proposta di azioni per dare all'Italia una posizione leader nei “digital media” (proposal of actions to give Italy a leading position in digital media), (English translation available soon)


[1] We call "digital media" content that is digitally represented, transported on digital networks and processed by programmable devices