CDRinfo exclusively presents an interview with Patrick Peeters, Sales and Marketing Director of Nero for more than 2 years. To learn more about Nero, read the entire interview
For the past 2 years, Patrick Peeters has served as a Marketing and Sales Director at Nero AG, a leading provider in the digital media technology sector. His experience in the industry also inlcudes 8 years at CD, DVD and digital video solutions manufaturer, Plextors where he worked as a European Sales and Marketing Director .
Peeters kindly answered all of CDRinfo's questions on Nero's technologies, the company's future plans and the effect of the blue-laser medias and their copy protection schemes on Nero's digital solutions.
Nero AG was formed in 1995 by Richard Lesser and has been privately owned ever since. I is one of the industry's top manufacturers of CD-R/RW, DVD and internet audio software applications, and one of the foremost suppliers of optical recording solutions.
Nero AG has its headquarters in Karlsbad-Itterbach, Germany. The U.S. subsidiary Nero Inc. was founded in Glendale, California in October 2001. The Japanese subsidiary Nero K.K. based in Yokohama, was subsequently founded in April 2004. The company currently counts more than 310 empoyees.
What is Nero's current position on the software market. How do you plan
to improve this position and what are your plans for future expansion?
To answer this question, we first have to define which part of the software market we are talking about. In the past, there was a clear seperation of
the different software markets; You had CD/DVD burning software, Video
editing software, photo-editing software, playback software, ... In the last
couple of years, all these markets have grown together to a real Digital
Media software market (one stop shopping solution). When you consider the
whole Digital Media software market, Nero is clear market leader. In Retail,
according to different market survey companies like GfK (Europe) and NPD
(USA), Nero is clear market leader. In OEM, there are no real market surveys
available, but when you just look at the number of ODDs (Optical Disc Drive)
and PCs that come with Nero software pre-installed, this already gives an
indication of Nero?s dominant market position.
Are you considering to expand to other fields than software (hardware)?
At the moment, Nero has no plans to expand to other areas other than
software. We still have a lot of opportunities to expand in the software
Being a leading figure in a profitable and expanding corporation, what
are the main ingredients of your success?
The main ingredient of our success is definitely the employees of Nero
worldwide. The motivation and competence of the Nero employees to make the
best products and thus create maximum customer's satisfaction, is the key to
the success. Although already more than 310 employees worldwide, Nero
remains a very open company for press, endusers and everybody wanting to get
in contact with our company.
You recently introduced Nero PhotoShow Deluxe 4, a photo management and
editing software and not so long ago Nero Sipps was released with a recent
version that targets mobile terminals. You are opening to other fields than
CD/DVD application software putting you in direct competition with
heavyweights such as Photoshop and Skype. Why did Nero chose to expand to
other applications and how do you believe the market is reacting and will
react to it?
As you mentioned, Nero is expanding in other fields than just Digital Media
software (where we are already market leader). There are several reasons for
this. More and more of our OEMs are asking us for a one-stop-shopping
solution, inlcuding photo application software and VoIP. It is no
coincidence that photo and VoIP are 2 very promising business areas and
could represent a significant part of Nero's business in the future.
Additonally, Photo and VoIP use a lot of key technologies that are already
implemented in the Nero 7 software package, so we basically build on the
knowledge that is already available in the company.
Hollywood is putting a lot of pressure on the industry regarding copy
protection issues for the next-generation HD DVD and Blu-ray formats. What
is your opinion and where does Nero stand on this issue?
The Hollywood studios have seen a significant part of their revenue taken
away because of the ease of making illegal copies. It is normal they want to
find a technology to prevent this from happening in the next generation
optical devices (High Definition). The one important thing the studios need
to be aware of however, is that a copy protection solution needs to be easy
for the enduser, and not create any technological barriers for legal users
to watch HD content. It does not make a lot of sense for the studios to find
a perfect copy protection technology, that afterwards nobody would be able
to use. When the studios are able to find a good technology combined we a
clear, intuitive and easy to use solution for the enduser, everybody would
benefit. Where does Nero stand in this? We work close together with the
studios in Hollywood, to see if we can cooperate on the technology side. We
have to stay at the edge of technology to assure that our software contains
the latest features.
The AACS copy protection scheme for both HD DVD and Blu-ray formats has
not been implemented yet, but the media in both formats is close to launch
and so is the compatible software. For Nero, What is the impact of this
delay ? Will you be able to release your software applications without
having to add major changes later?
There is now a preliminary agreement for AACS copy protection, where all
players in the market can start working with. That the AACS agreement has
caused some delay in the time-to-market of HD DVD and Blu-ray devices is
probably correct, however, for Nero this has not caused any competitive
disadvantage since the delay was the same for everybody in the market. As
far as we can see it right now, there are no major changes we need to add
later (although the implementation of AACS on itself is a significant change
in our software). But if later on we would need to do major changes (which
is very unlikely), this would have no negative impact on our customers,
since Nero has already since long a very flexible update policy; once the
user has a version of Nero, let's say Nero 7, this user can do free of
charge updates through the entire life cycle of this version.
The Blu-ray Disc License Entity recently released the licensing
requirements for Content Protection Systems for the BD-ROM media related
software. According to those specifications a BD-ROM PC Application Software
will require the implementation of AACS as well as BD+. The BD-Rom mark
however is not applicable. Can you explain us how these three elements
differ, how they are applied in your upcoming software, and what technical
issues relate to their implementation?
In addition to AACS, Blu-ray Discs (BD-ROM) also implement BD+ and ROM-Mark.
This is not the case for HD DVD. ROM-Mark is a secret watermark on the
pre-recorded disc, that prevents illegal mass production. If the ROM-Mark is
not present, or present but at the wrong area, such a disc may not playback.
ROM-Mark is not something that needs to be implemented into PC Software
applications, but is only applicable for BD-ROM media and BD drives. BD+ is
a secured virtual machine wich continuously monitors the movie stream of the
disc. In case there is a manipulation detected, playback will stop
immediately. AACS LA (responsible organization for AACS) delivers to device
and content providers a set of keys, that need to be implemented in the
products, and authenticates if the product is legally allowed to playback HD
content. Based on these keys, the sofware has to: authenticate the drive,
authenticate the content, if needed revoce the drive or content, decrypt the
media data, decrypt other content, validates the protected environment (PE)
for being compliant with AACS rules.
Nero Digital has been introduced by Nero as the next-generation
multimedia format for mobile devices, players, phones etc. What response has
it received on the market so far and what will be the main factors of its
We have seen the first device (DVD players) with Nero Digital technology
during Christmas 2004. This is around 1,5 years ago. When we see the number
of devices that have been shipped so far, and the (technological) response
Nero Digital has created in the market, we can say this is really exceeding
our expectations. Last year, more than 5 million devices have been sold
worldwide with Nero Digital implemented. Of course, we can still improve
with regards to available content etc, but you will not so often see a new
technology in the market with such a success after only 1,5 years.
Which CE makers have supported Nero Digital so far?
CE makers that have shipped devices with Nero Digital technology are
Grundig, Siemssen, Packard Bell, KiSS Technologies, Hyundai, IO Data,
Komparnass, Medion, Targa, Fujitsu-Siemens, Avayon, Xoro, Elta, Yamakawa.
And many more to come in the very near future.