Sources familiar with the talks told EE Times that the group, commonly called the 4Cs, is expected to choose one of two competing technologies: One developed by ARIS Technologies (Cambridge, Mass.), and the other from Blue Spike, Inc. (Miami, Fla.). Both are said to hold essential patents as well as robust watermarking technologies.

In the past several weeks, the group has been conducting a second round of testing on digital watermarking technologies proposed by ARIS, Blue Spike, Cognicity (Minneapolis) and Solana Technology Development Corp. (San Diego, Calif.) in addition to the one submitted by IBM.

Although the group's activity is solely focused on DVD-Audio, many industry sources believe the watermarking decision made within the DVD-Audio group will set the tone for what Secure Digital Music Initiative (SDMI) decides for its copy-protection mechanism.

Record labels see watermarking as a crucial piece of the copy protection system, whether their music is released over the Internet or on DVD-Audio. One senior executive at a California-based record label said, "Sooner or later, any encryption system can be broken. We need watermarking technologies to tell us who did it."

One resource for digital watermarking references can be found at the University of Cambridge's site.