Their goal: to usher in an age of secure digital songs wrapped in unbreakable code.
The Secure Digital Music Initiative was supposed to be just the medicine to marginalize the Napster phenomenon. Soon, there would be SDMI protected CDs and SDMI digital music downloads playing only on SDMI-compliant devices.
Now SDMI is roadkill, outpaced by developments in digital technology and done in by the narrow interests of its own members — record labels competing for dominance and music hardware companies impatient to get their products out to consumers.
In all, some 200 recording and technology companies that paid $20,000 in annual dues took part in SDMI's lengthy planning and specification design meetings. But many also ignored SDMI's long-term goals.
With music fans clamoring to listen to their illegally copied MP3 files on mobile devices, makers of the Rio, Nomad Jukebox and other digital music players weren't about to let the market slip by.
"This was the RIAA's attempt to reverse physics," says Jonathan Potter, director of the Digital Media Association, which represents some online media and technology companies. "And it was an attempt to use the cloak of technology development to really try to impose rules on the Internet and content owners."
For three years, SDMI members met in the U.S. and abroad, sharing ideas about how to digitally watermark audio files to make them hacker-proof or cloak them in another piece of computer code that only SDMI compliant CD players would recognize.
But the market for MP3s and digital music overtook them.
As Napster foundered in court, Gnutella, Morpheus and a host of other file-sharing applications took its place. Tens of millions of people downloaded the programs, sharing MP3s to listen to at home and on the road.
SDMI wasn't even close to ready as millions of consumers took advantage of these "killer apps," says Talal Shamoon, who had a front row seat for SDMI's downfall.
A vice president of business development at InterTrust Technologies, a digital rights management company and early SDMI member, Shamoon said "SDMI may have been the wrong medicine for anything."
"I think the market really moved under people's feet," he said.
SDMI's final public embarrassment came in September 2000 when the group issued a "Hack SDMI" challenge to computer programmers around the globe. SDMI encoded and digitally watermarked some audio content and dared programmers to hack it.
Princeton professor Edward Felten and a few colleagues met the SDMI challenge in three weeks and were about to present a paper on how they did it when the Recording Industry Association of America threatened to sue.
The RIAA eventually backed off, with the association's general counsel later calling the letter a mistake. But the damage was done.
All five major music labels continue to work on copy protection of course. But competing digital rights management schemes are multiplying, and don't play well with each other.
Music downloads from the labels' online service pressplay don't work with software downloaded with RealNetwork's Musicnet subscription, and none of those downloads play in a Rio Player, Nomad Jukebox or iPod.
Many manufacturers say they plan to upgrade the software in their devices so the music players will recognize the protected content format — as soon as someone invents one that consumers care to buy.
But such advances may make the players incompatible with today's digital music, leaving listeners with thousands of MP3s and no device to hear them on.
"Purely from a technological perspective and from a consumer electronics standpoint, it's very important to have a format that everybody can eat," Shamoon said.
For up-and-coming MP3 player companies like Bantam Interactive, deciding whether to support digital rights management may mean life or death in terms of consumer acceptance.
"I do not want to make any player which allows only to play copy-protected music," said Santosh Patel, Bantam's president.
He never joined SDMI, which was already on its last legs when Bantam was coming to market with its two players 1 1/2 years ago.
Patel wants his products to evolve to support future copy-protected music formats, while retaining the ability to play older unprotected MP3s.
"That way you support the technology, you support the security and eventually you phase out the unprotected material," Patel said.
Another organization appears poised to pick up where SDMI left off.
The newly formed Digital Media Device Association intends to develop specifications for digital entertainment on portable devices. The group has about 40 members who have been meeting monthly since January, but little else is known about the effort and its director, Tom White, refused to offer details.
Some in government appear to be losing patience with the lack of a solution to securing digital content.
Sen. Ernest "Fritz" Hollings, D-S.C., has proposed a bill to require any "interactive digital device" sold in the United States to prevent users from making unauthorized copies of copyright material.
If the private sector doesn't agree on copy-protection methods within two years, the government would determine the standard.
The Digital Media Association's Potter opposes Hollings bill.
"We don't think the government has engineers that rival the private sector's," Potter said. "Nor do we think it's possible to confine consumers. You need to win consumers in the marketplace."