XReco Blockchain-Based Rights Management

The XReco project deploys several tools that aim at facilitating data sharing and fostering the creation of new content in the media domain. Generating novel content from multiple sources, especially in an AI enabled automatic (or semiautomatic) way, implies crucial challenges in terms of the definition of ownership and monetization rights, to ascertain which rights are associated with given content items, and how such content can be (re)used and monetized. The Rights and Monetization Management components, based on Blockchain technology, have the goal of associating content in XReco with licenses for their use and of assisting in the automated management of license clauses to support content monetization in conjunction with the business models covered by the project.

Blockchain is a ledger that enables the creation and management of a digital, immutable, transparent, and distributed register of transactions. Transactions are grouped and held in blocks that are chained together by means of cryptographic hash functions, with each block containing the hash of the previous block (Figure 1).

Figure 1. How blocks are chained.

The technology relies on consensus mechanisms, such as proof-of-work or proof-of-stake, to validate and add new transactions to the chain. This decentralized nature ensures that no single entity has control over the entire network, reducing the risk of fraud and manipulation. With the combination of hash functions, decentralised consensus mechanisms, and interconnection between blocks, the integrity of the blocks is preserved, guaranteeing the immutability of the data recorded.

Figure 2. Blockchain Network Infographic.

Blockchain can be applied to various areas, particularly in the cryptocurrency realm such as Bitcoin and Ethereum. It acts as the underlying technology for these digital currencies, facilitating secure and transparent peer-to-peer transactions. Furthermore, blockchain has extended its use cases beyond cryptocurrencies to areas such as supply chain, healthcare, finance, and smart contracts.

Smart contracts are software programs deployed on a blockchain ledger and executed during transactions on the blockchain. These contracts can manage and transfer digital assets within the blockchain network, and they can also invoke other smart contracts stored on the same blockchain. Once deployed, smart contract code becomes deterministic and immutable. Consequently, nodes within the blockchain network execute these smart contracts, ensuring consistent results across all nodes. The outcomes of execution are securely recorded on the blockchain.

• Smart contracts offer several valuable benefits:
• They reduce the risk of human error.
• They eliminate the need for intermediaries.
• They provide automation capabilities.
• They enable innovative business models.

However, it’s essential to recognize that smart contracts are not as “smart” as their name suggests, nor are they traditional legal contracts. In practical terms, a smart contract is merely code that runs on a blockchain platform. While powerful, it cannot be directly equated to legally enforceable contracts.

There is a need, therefore, to link the legal validity of an actual contract with the executability of code to digitalize the licensing management. To this end, XReco is considering the so called Smart Legal Contracts.

A Smart Legal Contract is defined as: “a human-readable and machine-readable agreement that is digital, consisting of natural language and computable components. The human-readable nature of the document ensures that signatories, lawyers, contracting parties and others can understand the contract. The machine-readable nature of the document enables it to be interpreted and executed by computers, making the document ‘smart’”. Therefore, the SLCs link and automate the legal and physical aspects of contracting by translating a contract language into executable code. This code communicates with external sources, allowing self-execution based on input data. In this way, we can dynamically create and validate asset licences without manual operations.

It will thus be possible to notarize the data of an SLC onto the Blockchain to benefit from the advantages offered by the technology itself, such as immutability, visibility and transparency, while maintaining the ability of Smart legal contracts to articulate and execute the terms of an agreement on a legally enforceable basis.

In the XReco architecture, the creation and registration of blockchain and related smart contracts and SLCsis handled by a component dedicated to rights and licence management. This component contains various microservices such as Rights Management (RM), a Monetisation Manager (MM), an SLC Engine and a Blockchain Service Provider (BCSP).

Figure 3. Visualisation of the rights and monetisation management architecture

More specifically, RM is the service that is exposed to the other components of XReco and is responsible for intercepting requests and managing the other microservices:

• SLC Engine: handles all aspects of SLC, such as creation, validation and execution;
• Blockchain Service Provider: handles the communication with blockchain, such as deploying and interacting with SCs;
• Monetization Manager: calculates the economic value for the transaction in correlation with the relevant business model.

For instance, an XReco workflow may involve receiving a registration request containing all the information related to the asset to be registered, together with the proposed license. To fulfil this request, the RM calls the MM to calculate the economic value involved in the transaction, and subsequently calls the SLC Engine that will return the text and metadata of the SLC according to the licence requested. Finally, the BCSP stores the metadata, the hashes of the asset and the SLC on the Blockchain, ensuring immutability and legal enforceability, thus bridging the gap between automated execution of code-based agreements in blockchain and legal systems.

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Qureshi, A., & Megías Jiménez, D. (2020). Blockchain-Based Multimedia Content Protection: Review and Open Challenges. Applied Sciences, 11(1), 1. https://doi.org/10.3390/app11010001

Mik, D. E. (2020, May 1). From automation to autonomy: Some non-existent problems in contract law (SSRN Scholarly Paper ID 3635346). Journal of Contract Law. https://papers.ssrn.com/abstract=3635346; Mik, E. (2019, December 7).

Roche, Niall, et al. “Ergo-a programming language for Smart Legal Contracts.” https://doi.org/10.48550/arXiv.2112.07064 (2021)