Flash memory and solutions developer SanDisk along with LG have announced a new managed content solution for carriers that wish to offer licensed content without the intrusive effects of conventional DRM methods.
The service works by bundling a memory card with the carrier branded handset and uses the venerable OMA SmartCard  WebServer to authenticate the content on the card and the SIM information within the phone to unlock the content.  If the memory card is used on an unbranded device, the data on the card will become inaccessible until it is placed back on the branded and authorized handset, even if the SIM authentication is valid in the unbranded device.
This is the first attempt by both companies to offer such a system, with LG implementing it on the Renoir KC910, but no carriers have agreed to deploy the service as of now.
I don’t see this as gaining a lot of adoption. Carriers don’t benefit from it versus other DRM systems. Sprint Music Store hasn’t been cracked, and neither has Rhapsody or V CAST Music on phones. This is probably, of course, due to lack of interest more than anything else.
At the same time, it makes developing such a platform a real hassle. Carriers have to work with phone manufacturers, rather than a Java/BREW developer to embed code.
And, locking out unbranded handsets from the system? While everyone is trying to go “open access” with devices (whatever that means at this point), this certainly isn’t in the right direction.
My advice to carriers: Unless you want a repeat of what hasn’t worked… stay far away from this system. iTunes is dropping DRM on music for a reason.
I’m curious if these protected memory cards could be used to distribute movies. Video on smartphones is only going to get better, especially with Nividia’s Tegra chip.
It could be a new revenue opportunity for mobile phone stores or even Blockbuster.
I do suspect it is for video… but, the same problems remain. Why add more insular DRM when people aren’t even bothering to break existing DRM formats (formats that are much easier to implement than this one… and far less dependent on single-company reliances).