Security Focus just posted this interview of me, talking about DRM. Here are a few choice quotes.
On authoring software protection for Vista:
The rules of the game are changing recently with Microsoft Vista kernel patch protection. If you’re a rootkit author, you just bypass it. If you’re a software protection designer, you have to play by its rules. For the first time in the PC’s history, it’s not a level playing field any more. Virus scanner authors were the first to complain about this, and it will be interesting to see how this fundamental change affects the balance of power in the future.
On using custom hardware for protection:
Custom hardware often gives you a longer period until the first break since it requires an attacker’s time and effort to get up to speed on it. However, it often fails more permanently once cracked since the designers put all their faith in the hardware protection.
rdist 
“you have to play by its rules”
Can you clarify whether that is an ethical ‘have to’ a legal ‘have to’ or a practical ‘have to’? Also, I’d enjoy hearing your perspective about how virtualization impacts this. If you can bypass kpp with a ‘blue pill’ or perhaps with VMsafe in the future, where does that fit in? And on a side note, do you think VMsafe is moving in the same (presumably problematic) direction?
Pete
Pete, I mean “if you are a legitimate software author, you have to obey Microsoft’s rules if you want to stay in business.” Microsoft has already shown that they will rev PG and revoke keys used to sign drivers they think violate this policy. So whatever you think of their approach, attacking it head-on as an independent software author is going to be futile.
The problem is, arguably legitimate software like games use drivers for their own protection that hook the IDT or other behavior that is now off-limits. It may ultimately prove that Vista is a bigger source of pirated games since you’d only need to crack a single system (Patchguard) instead of a variety of diverse protections that are game-specific.
Virtualization will have no effect on this progression. Microsoft will move Patchguard into the VMM and it will watch the guest OS’s kernel structures for modification. The ultimate effect is one of weakening the capabilities of 3rd-party protection while centralizing Microsoft’s control over kernel system policy.
It will take some time before we see how this works out. If 3rd-parties were terrible at it anyway, it may improve security and stability to take their hands off. (This is Microsoft’s position, it seems). On the other hand, if they were skilled and the diverse protections required extra attacker effort, moving to a single scheme seems like a bad idea.
Is it really true the movie industry doesn’t have figures on how much a non-pirated title makes? DVD wasn’t cracked immediately, in fact didn’t breaking CSS take two years? Something that might have been worth mentioning is a lot of DRM systems seem to be cracked by Linux fans who want to be able to do XYZ on their favourite platform. Both DVD and XBox360 security seemed to fall because of the actions of these guys. It seems that if manufacturers were sure to support these platforms from the start, there’d be fewer skilled people working on cracking them.
Mike, CSS was cracked in late 1999 and it wasn’t until then that DVDs started to become popular. It’s hard to separate out the effect of piracy when the huge groundswell of cheap players after 2000 lifted the whole video market so high.
Now that it’s matured, so has the pirate market. DVD rips are readily available, sometimes even before release. I think that’s the nature of encryption-only DRM (CSS, AACS). Once it’s broken and the attackers have experience, it stays broken with only short periods of success. However, with a renewable scheme, you have longer periods of success that can help you assess how much additional revenue effective security gets you over time.
There are two main motivations for experienced hackers: free and for-pay. If the second group didn’t exist, the Playstation 3 would never have a modchip since it allows you to install Linux. However, the fact that a modchip will appear shows that playing pirated games is a big motivator and the for-pay group is also skilled.
Piracy of media content has always exist. And every time a new technoligy emerge, the new media container seem to be more and more fragile. Just take DVDs into account or worst, Blue-ray disc. Just a like scratch can make the disc unsuable. Making copy of legaly own DVD or Blue-Ray disc in order to increase their longevity shouldn’t be a pain. Also, I did break two DVDs, one movie and one PS2 game, while in their housing. Why do I have to install a modchip on my PS2 or find either pirated version of a movie I own over the Internet or simply rip it myself to ensure that the dics I bought will last. I just digitilize the whole Disney VHS collection of my girlfriend so she can watch them again an not fear to destroy the VHS tape using the old VRC. Why can’t it be this easy with DVDs or Blue-Ray discs?