What is digital watermarking?
"Digital watermarking is the process by which identifying data is woven into media content such as images, printed materials, movies, music or TV programming, giving those objects a unique, digital identity that can be used for a variety of valuable applications. Imperceptible to the human senses yet easily recognized by special software detectors, a digital watermark remains constant even through recording, manipulation and editing, compression and decompression, encryption, decryption and broadcast - without affecting the quality of the content.
Digital watermarking can enable content identification and copyright communication on a broad scale and can provide a range of solutions for identifying, securing, managing and tracking digital images, audio, video, and printed materials. In fact, digital watermarking technology has already been adopted by many photographers, movie studios, record labels, television broadcasters, and corporate enterprises. These industries use digital watermarking to identify, protect and manage the rights to their content as they embrace innovative distribution or business models and provide consumers with new entertainment experiences, enhanced convenience, and greater portability of their media content." (http://www.digitalwatermarkingalliance.org/pr_092006.asp)
From the P2P Weblog at http://www.p2p-weblog.com/50226711/digital_watermarking_alliance.php
"While watermarking can be an effective technology in file identification, it has had a difficult time gaining acceptance. There are competitive technologies and insufficient incentives to deploy watermarking. Unlike fingerprinting, for example, watermarking requires content providers to encode files so that the marks can be read by media players."
Digital watermarks can identify copyrighted content and associated rights, during and after distribution, to determine copyright ownership and enable rights management policy while enabling innovative new content distribution and usage models." (http://www.p2p-weblog.com/50226711/digital_watermarking_alliance.php)