"We've got a problem we share with everyone. Content owners want a DRM, consumers know what a DRM is" and they don't like it, said Cohen, who claims BitTorrent (San Francisco) has the largest catalog of digital video now on the Web.

"We are using Windows DRM because it is the only solution that has been vetted widely, but we are not happy with how it affects playback from a technology point of viewit sometimes makes playback not work," said Cohen in a talk at the conference.

"At the end of the day, content rights represent the biggest hurdle. There's a lot of investment capital that could go into technology if we could solve this issue," said Jeff Carlisle, vice president of government relations for notebook maker Lenovo, speaking on a separate morning panel.

Nevertheless, Cohen expressed confidence the Internet will become the primary source for video in the future. "What's ultimately going to happen is the whole medium of broadcasting will go away and be replaced by IP so people can get what they want when they want it," he said.

BitTorrent has several projects in the works, he added. They include a new product to let businesses distribute content, an ad-supported video service and a streaming video capability.

Separately, a company allied with the conference has submitted a petition to the Federal Communications Commission asking that Internet video be exempted from regulations. Network2, a video Web site started by VON conference founder Jeff Pulver, asked the FCC to free Internet video both from existing cable and broadcast regulations as well as any new rulings.

Pulver also announced the Video on the Net Alliance, a new advocacy group to promote the interests of Internet video.

"The nascent video on the Net industry must learn, and learn quickly, how to engage policymakers and speak with a unified and consistent voice, or rules will be set for this emerging industry by those who might not know what policies would best advance Internet video," said Jonathan Askin, co-founder of the alliance.

"The consumer view is not adequately represented in Washington. There is a powerful notion of user groups that hasn't yet had impact," said Carlisle of Lenovo in the morning panel.

However, several other panelists said it is unrealistic to expect the Internet will steer clear of future restrictions in areas such as universal services and government access." We can no longer operate under the myth that the Internet is unregulated," said Robert Pepper, a senior manager of technology policy for Cisco Systems, speaking in the morning panel.