By Sinead Carew and Lucas van Grinsven
SanDisk Corp. on Tuesday introduced memory cards that let consumers move digital video and music among devices like cellphones and computers without violating copyright protection.
The first cards to go on the market in November will come preloaded with the Rolling Stones' new CD "A Bigger Bang," said SanDisk, which helped pioneer flash memory storage cards used in phones and digital cameras.
Internet media company Yahoo Inc. (Nasdaq:YHOO - news) said customers who subscribe to its digital music service could use the card which will be sold under the name gruvi. Samsung Electronics Co. Ltd also said it would support gruvi in its phones.
SanDisk's new cards come as the entertainment industry moves content to the Internet and onto devices such as mobile phones. The industry is increasingly protecting its content with software that prevents copying to plain flash memory cards or other non-secure storage mediums.
SanDisk, based in Sunnyvale, California, hopes to convince other entertainment companies to sell their content preloaded on the cards, or make it available for secure Internet downloads straight onto the cards.
"This enables secure content to be truly portable for the first time," SanDisk Chief Executive Eli Harari said at a press event at the Cellular Telecommunications & Internet Assocation, or CTIA wireless conference in San Francisco.
Harari said that once the cards are widely used by technology and entertainment companies, he expects them to bring in sizable revenue for the company by the end of 2007.
"This will take one or two years to become a very substantial business," Harari said on the sidelines of the conference.
He said he expects the bulk of sales to come from empty cards that consumers then fill with the content of their choice and that demand will increase as prices come down.
He sees preloaded cards such as the 265 Megabyte $40 card that will go on sale in November with a Rolling Stones album on it as an example of how the cards could be used.
SanDisk hopes companies would use Sandisk's TrustedFlash technology to implement their own digital rights management systems, Harari said.
"It has the potential to change how people view mobile content," said Ted Cohen of record label EMI, adding that the company would see how consumers receive the Rolling Stones product before more similar products for other performers.
The TrustedFlash cards will work as normal mass storage cards with capacity of up to several gigabytes of data -- but the movies, music or games on the cards would be protected with digital rights management (DRM) software.
The cards can also contain media and game playing software, which make it possible to play content on devices that were not originally designed for those services, though devices must be compatible with the TrustedFlash cards.
The new type of storage media is designed to support electronic commerce and enable mobile phones to perform secure financial transactions.
SanDisk said it is unique in that it offers the advantage of portability, so consumers will be able to take their legally purchased music, movies and games with them and play them on any compatible device.
Copyright 2005 Reuters Limited.
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