In an effort to protect its copyright material for digital distribution, music company Universal is preparing to incorporate technology that may keep consumers from playing their legally bought CDs over their PCs at work or at home as soon as next month.

The digital rights management (DRM) technology that Universal is most closely considering is called Cactus Data Shield, from the Israeli company Midbar Tech, according to a source close to Universal.

The technology would be used to scramble the data on an audio CD so that CD and DVD drives in PCs can't play them. The technology is expected to be applied to at least one new CD release from Universal before the end of the year, with production to be ramped up after that, the source said.

Consumer-advocate campaigners, such as UK-based Campaign for Digital Rights, are concerned that it is simply a matter of time before the major music companies use such technology as a matter of course to keep consumers from playing legally bought CDs in their PCs at work or at home. Music companies may do so, the consumer advocates say, without warning consumers or lowering the price of a CD that some users may find less useful.

Universal's decision regarding copy-protected CDs comes on the heels of Sony's acknowledgment in September that it had incorporated its copy-protection software, key2audio, in promotional CD copies of the Michael Jackson single You Rock My World, making it impossible for radio producers to play the CD on PC CD drives or to re-record the single.

Universal's technology would be very similar to key2audio technology developed by Sony in that it would keep audio CDs from being played on standard CD/DVD-ROM, CD-R and CD-RW drives, and therefore make those CDs unplayable on PCs or Apple Macs, according to the source close to Universal.

"Universal Music Group has been undergoing extensive exploration and technical evaluation of a variety of technologies designed to prevent the growing problem of CD copying and duplication. UMG will be implementing copy protection on a number of releases starting in the fourth quarter 2001," parent company Vivendi said in a statement yesterday.

According to the source at Universal, there is still some wrangling going on over the final decision to issue copy-protected CDs, with a "pretty big faction" within the company strongly arguing that the technology should be dropped, in no small part because they believe it will be cracked immediately. But despite such concerns, "the word is coming from the top of the company," to proceed with copy-protected CDs and to do it soon, the source said.

Along with consumers of audio CDs, large software makers like Microsoft and RealNetworks could also be caught out when the copy-protected CDs hit the market. Both of the new multimedia players from Microsoft and RealNetworks, the Windows Media Player and the RealOne Media Player respectively, have features that let PC users play and organise tracks from audio CDs.

The copy-protected CDs from Universal and Sony would render those highly touted features useless on both media players, something the companies are all too aware of. "It is a tricky situation. What I can say is that we working with (the major music labels), and are trying to educate them about offering customers the flexibility they want while also protecting (the company's) copyrights at the same time," said George Fraser, RealNetworks' director for Northern Europe.

The copy-protected CDs are also potentially an issue for subscription digital music service Pressplay, the joint venture between Vivendi Universal and Sony Music Entertainment Inc. that is expected to launch by December.

To avoid short-circuiting its new digital music service, the source said, Universal is considering creating audio files especially for Pressplay. These files would use a DRM scheme that would allow Pressplay subscribers to download and play them on PC drives.