CONFIDENTIAL AND NON-BINDING
FOR DISCUSSION PURPOSES ONLY
AMZN Draft 7-9
CDD-AMAZON 4K TERM SHEET
- Parties:
- Culver Digital Distribution Inc. (“CDD”)
- Amazon Digital Services, Inc. (“Amazon”)
- Amendment:
- The terms included in this Term Sheet, if mutually agreed and incorporated into an executed written amendment (“Amendment”),will amend the ODRL and VOD Distribution Agreement between CDD and Amazon dated October 7, 2013 (“ODRL Agreement”)
- Condition Precedent:
- It is a condition precedent to the Amendment that Amazon has, on or prior to the Effective Date, an executed agreement with one (1) or more other Major Studios granting Amazon the right to distribute each such studio’s first-run, feature length motion pictures and/or television programmingin the Approved 4K Format on an ODRLbasis with substantially similar content commitments and financial terms to those set forth herein, to the extent such content commitments and financial terms are applicable based upon the relative nature of the content provided by such Major Studio(s) and CDD[JN1]
- Effective Date:
- The 4K ODRL Rights grant commences[Date TBD](“Effective Date”) and will continue until the expiration of the Term
- Notwithstanding the foregoing, Amazon will not make any 4K ODRL Included Program available on any device in a Licensed Country until such time as Amazon makes such programan application available to a CDD Affiliate on a non-discriminatory basis that would allow such program to beavailable on the same type of device branded by a CDD Affiliate within such Licensed Country(e.g., 4K ODRL Included Programs may not be made available on Samsung-connected TVs in the U.S. until such programs are also made available for distribution on Sony-connected TVs within the U.S. by Amazon providing a CDD Affiliate with an Amazon application on a non-discriminatory basis that would facilitate such distribution on Sony-connected TVs within the U.S.)
- Territory:
- The 4K ODRL Rights grant is for U.S.., Germany, the United Kingdom, and Japan and their respective territories and possessions (collectively, the “Territory,” each, a “Licensed Country”) [Germany and UK TBD]
- 4K ODRL Rights:
- CDD grants Amazon, and Amazon accepts, a limited, non-exclusive, nontransferable, non-sublicensable licenseto distribute solely bythe Approved Transmission Means each 4KODRL Included Program in the 4K ODRLAuthorized Versionand the Licensed Language on an ODRL basis[JN2]delivered in the Approved 4K Format to anApproved 4K Device of an ODRL Customer of the Service for Personal Use in the Territory pursuant solely in each instance to a 4K ODRL Customer Transaction and subject at all times to the 4K Content Protection Requirements and 4K ODRL Usage Rules (“4KODRL Rights”)
- UltraViolet Compatibility:
- At such time when Amazon launches modifications of the Service that would enable an UltraViolet Ecosystem (“UV”) customer offering as part of the Service, Amazon will place the CDD-approved 4K Rights Tokens for 4K ODRL Customer Transactions from the corresponding Amazon Customer Accounts to the associated (linked) Customer UV Accounts, grant fulfillment rights, and perform fulfillment in respect of such program(s) to such Amazon Customer. Additionally, 4K Rights Tokens for Amazon Customers with linked UV Accounts from third-party retailers must be redeemed and fulfilled by Amazon upon Customer request in accordance with the 4K ODRL Usage Rules. Amazon will be required to perform for 4K ODRL Included Programs all agreed-upon obligations related to any UV customer offering for Included Programs in Standard Definition or High Definition[JN3]
- Approved 4K Format:
- “Approved 4K Format” is a digital electronic media file compressed and encoded for secure transmission and/or storage in a resolution of 3840x2160 and protected by the Approved UHD Content Protection System (as defined in Schedule F). The Approved 4K Format is an Approved Format solely with respect to 4K ODRL Included Programs distributed pursuant to the 4K ODRL Rights
- “4K ODRL Authorized Version” is the ODRL Authorized Version made available by CDD to Amazon for distribution in the Approved 4K Format on an ODRL basis hereunder
- For the avoidance of doubt, the definition of 4K ODRL Authorized Version does not include Standard Definition or High Definition versions, and [JN4][SPE5]Amazon is not authorized to scale any lower resolution content (e.g., High Definition) up to 3840x2160 without prior written approval from CDD
- Any Included Program with a resolution greater than High Definition and/or a quality level beyond High Definition must be protected by the Approved UHD Content Protection System
- 4K ODRL Included Programs:
- “4K ODRL Included Program” means every ODRL Included Program that CDD designates in its sole discretion and notifies in writing to Amazon as authorized for ODRL distribution on the Service in the Approved 4K Format, each of which will be delivered to Amazon with, at a minimum, a picture 3840 pixels wide or 2160 pixels tall and Rec 709 10-bit color space[SPE6].
- When exhibiting each 4K ODRL Included Program on the Service, Amazon mustwill work with CDD in good faith to identify appropriate ways to designate, in a manner pre-approved by CDD, that such program has been captured and mastered in 4K resolution; provided, however, that Amazon will have sole discretion as to the method of designating that each such program has been captured and mastered in 4K[SPE7].
- 4K ODRL Availability Date:
- The “4K ODRL Availability Date” means, for each 4K ODRL Included Program, the date specified byCDD in its sole discretion on which Amazon is entitled to commence 4K ODRL Customer Transactions with respect to such program on the Service
- Availability Notices provided by CDD will indicate which Included Programs are available as 4K ODRL Included Programs
- Amazonwill be obligatedhave the option, in its sole discretion, to elect to license each 4K ODRL Included Programincluded on the Availability Notices on the Service on an ODRL basis during such program’s 4K License Period
- “4K ODRL Customer Transaction” means each ODRL Customer Transaction whereby an ODRL Customer is authorized by Amazon to stream, decrypt and play a copy of a single 4K ODRL Included Program from the Service on an ODRL basis in exchange for a corresponding per-transaction fee
- Any 4K ODRL CustomerTransaction of a 4K ODRL Included Program will include the right(s) to download, stream, decrypt and play a copy of such program from the Service on an ODRL basis in the Standard Definition and/or High Definition version in accordance with the ODRL Usage Rules. For the avoidance of doubt, for the purpose of calculating the Distributor Price, a Customer’s access to the Standard Definition and/or High Definition version of a 4K Included Program pursuant to a 4K ODRL Customer Transaction will not constitutea separate Customer Transaction and will be included as part of the single 4K ODRL Customer Transaction for such program
- 4K License Period:
- The “4K License Period” means, for each 4K ODRL Included Program, the period during which Amazon may make such 4K ODRL Included Program available for 4K ODRL Customer Transactions on the Service
- The 4K License Period for each 4K ODRL Included Program will commence on such program’s 4K Availability Date and end on a date established by CDD in its sole discretion, on a prospective basis, 60 days following Amazon’s receipt of a notice (each such notice an “End Date Notice”) from CDD identifying an end date (an “End Date”), which such notice may be delivered by CDD to Amazon at any time in CDD’s sole discretion; provided, however, that for the avoidance of doubt, any such End Date will only have a prospective impact on the availability of a given 4K ODRL Included Program, and will have no impact whatsoever on the availability of any such 4K ODRL Included Program to a customer that has concluded a valid 4K ODRL Customer Transaction prior to the applicable End Date.
- Approved 4K Devices:
- A device will only be a Approved 4K Device if it provides access to the Service, is capable of receiving 4K ODRL Included Programs via the Approved 4K Transmission Means, implements the 4K Content Protection Requirements and 4K ODRL Usage Rules, and is manufactured by an approved manufacturerand implements the 4K Content Protection Requirements and 4K ODRL Usage Rules; provided, [SPE8]however, that in the event CDD allows another digital distribution service to distribute 4K ODRL Included Programs on devices with less restrictive content protection requirements or usage rules than the 4K Content Protection Requirements or 4K ODRL Usage Rules, as applicable, then CDD will notify Amazon in writing of such less restrictive content protection requirements and usage rules and Amazon will be bound by such less restrictive content protection requirements and usage rules[SPE9]
- Approved 4K Devices are subject to withdrawal of approval by CDD pursuant to the 4K Content Protection Requirements
- Approved 4K Devices are Approved Devices under the ODRL Agreement
- 4K Distributor Price:
- The “4K Distributor Price” is:
- For Feature Films, $25.50 per 4K ODRL Customer Transaction
- For Television Episodes, 70% multiplied by the greater of (i) $3.99 and (ii) the actual amount paid or payable by the Customer for the 4K ODRL Customer Transaction (whether or not collected by Amazon)[JN10]
- Minimum Guarantee:
- No minimum guarantee, provided howeverthat if Amazon agrees, or has agreed, with any other content provider to pay a minimum guarantee or advance for rights to distribute programs on the Service in the Approved 4K Format on an ODRL basis, then Amazon will be required to pay CDD a proportionate minimum guarantee (pro-rated for the amount of content licensed and length of contract term) [JN11]
- Reporting:
- With respect to Amazon’s reporting obligations and Statements required pursuant to the Agreement, Amazon will provide CDD all required information broken out on a Standard Definition, High Definition and Approved 4K Format basis
- Additional 4K reporting requirements [TBD][JN12]
- 4K ODRL Usage Rules:
- The ODRL Usage Rules in Section 1.45 of the ODRL Agreement and the Streaming Requirements in Schedule B-4 of the ODRL Agreement applicable to ODRL Included Programs will apply to 4K ODRL Included Programs (“4K ODRL Usage Rules”). For the avoidance of doubt, 4K ODRL Usage Rules are limited to Streaming only; electronic download is not permitted ; provided however, that Amazon will have the right to create and cache one or more Instant Playback Segments for customers pursuant to Section 3.2 of the ODRL Agreement[SPE13]
- 4K Content Protection Requirements:
- “4K Content Protection Requirements” means the Content Protection Requirements and Obligations applicable to audio-visual content in the Approved 4K Format, as set forth in Schedule F
- Amazon Store Placement:
- Amazon will providenot less favorablenon-discriminatoryplacement orandpromotional treatment for CDD’s 4K ODRL Included Programs than it provides for other providers’ 4K audio-visual content
- Promotional Rights:
- Amazon will perform marketing and promotional activities for the 4K ODRL Included Programs in accordance with tactics mutually agreed by the parties hereto, including without limitation: [TBD][JN14]
- Amazon will have the right to use or authorize the use of Advertising Materials for 4K ODRL Included Programs (“4K Advertising Materials”) solely for the purpose of advertising, promoting and publicizing the availability of the 4K ODRL Included Programs in the Approved 4K Format on the Service, subject to the rights and obligations in the ODRL Agreement
- Materials and Encoding Costs:
- CDD will deliver to Amazon, or grant access to Amazon, an encoded digital file in the format specified by CDD for each 4K ODRL Included Program (“4K Picture Master”) and 4K Advertising Materials [4K Delivery Requirements Schedule TBD]
- Amazon will only use the 4K Picture Masters in connection with the 4K ODRL Rights and the distribution of 4K ODRL Included Programs in the Approved 4K Format. For the avoidance of doubt, 4K Picture Masters may not be used in connection with exhibition of any Included Program in Standard Definition or High Definitionresolution without CDD’s prior written approval
- All costs of encoding, duplicating, creating, delivering and shipping the 4K Picture Masters and 4K Advertising Materials will be at Amazon’s sole cost and expensesubject to the ODRL Agreement[JN15][SPE16]
- Amazon’sAmazon will consult with CDD regarding itsencoding (process and quality) of a 4K ODRL Included Program will be subject to CDD’s prior approvalPrograms [SPE17]
- In the event Amazon agrees to pay the costs to another Major Studio of converting non-4K catalog assets or other assets to create 4K masters, Amazon will pay CDD, at CDD’s option, the same costs for the 4K conversion of a commensurate number of 4K ODRL Included Programs created by CDD to date
- Additional Terms:
- Capitalized terms used but not defined in this Term Sheet have the meanings ascribed to them in the ODRL Agreement
- This Term Sheet is a general outline for discussion purposes only. The parties acknowledge that they neither intend to enter, nor have they entered, into any definitive agreement or any agreement to negotiate a definitive agreement pursuant to this document, and either party may, at any time prior to execution of such definitive agreement, propose different terms from those summarized here or unilaterally terminate all negotiations without any liability whatsoever to the other party. This Term Sheet does not constitute an offer or a legally binding obligation of the parties, and no legally binding obligations of the parties will be created, implied, or inferred by this Term Sheet
Schedule F
Content Protection Requirements And Obligations for 4K Format Content, FOR STREAMING ONLY SERVICES
DRAFT DOCUMENT.
CDD RESERVES THE RIGHT TO MAKE CHANGES.[JN18]
Definitions
All defined terms used but not otherwise defined herein shall have the meanings given them in the ODRL Agreement.
General Content Security & Service Implementation
- Approved UHDContent Protection System. All content delivered to, output from or stored on a device must be protected by a content protection system that includes digital rights management, encryption and digital output protection (such system, the “Approved UHD Content Protection System”).
- The Approved UHD Content Protection System shall be approved in writing by CDD (including any significant upgrades or new versions).
3.Approved 4K Format content shall only be delivered to Set Top Boxes (“STBs”), Connected Televisions and other device types approved by CDD in writing.
- All STBs and Connected TVs and any associated Security Providers (e.g., the provider of a smartcard or embedded security module or security client) processing Approved 4K Format content shall be approved in writing by CDD. Amazon represents and warrants that (i) each Approved 4K Device and Security Provider meets the requirements in this schedule and (ii) Amazon has conducted sufficient due diligence, including discussing the relevant requirements with all manufacturers and security providers, to confirm the representation and warranty given in the foregoing subclause (i).Devices.[SPE19]
- Encryption and Decryption.
5.1.4.1.The Approved UHD Content Protection System shall use AES (as specified in NIST FIPS-197) with a key length of 128 bits or greater, DVB-CSA3 or other encryption algorithm approved in writing by CDD. DVB-CSA (version 1) is NOT approved.
5.2.4.2.New keys must be generated each time content is encrypted (though different instances of the same title on the same service may be encrypted with the same key). A single key shall not be used to encrypt more than one piece of content or more data than is considered cryptographically secure. The random number generator (RNG) used for key generation shall be cryptographically secure and shall be on the list of RNGs approved in FIPS 140-2 Annex C.[SPE20]
5.3.4.3.The content protection system shall only decrypt content into memory temporarily for the purpose of decoding and rendering the content and shall never write decrypted content (including, without limitation, portions of the decrypted content) or streamed encrypted content into permanent storage.; provided however, that Amazon will have the right to create and cache one or more Instant Playback Segments for customers pursuant to Section 3.2 of the ODRL Agreement.[SPE21] Memory locations used to temporarily hold decrypted content shall be secured from access by any code running outside of the Trusted Execution Environment and any trusted application other than the content protection system trusted application(s).
(A "Trusted Execution Environment" or "TEE" is a computing environment which is isolated from the application execution environment using a security mechanism such as a verified implementation of ARM TrustZone, hardware enforced virtualization, a separate security processor or processor core or other similar security technology.). Decrypted content shall be securely deleted and overwritten as soon as possible after the content has been decoded and passed to rendering functions.
5.4.4.4.Keys, passwords, and any other information that is critical to the cryptographic strength of the Approved UHD Content Protection System (“Critical Security Parameters” or“CSPs”) may never be transmitted or permanently or semi-permanently stored in unencrypted form. Memory locations used to temporarily hold CSPs must be secured from access by any code running outside of the Trusted Execution Environment and any trusted application other than the content protection system trusted application(s). The storage facility where encrypted CSPs are held must be able to prevent or detect rollback of the stored information. If rollback is detected, execution of code must be disabled.