First of all – the Silverlight DRM client is FREE!
The main component for playing DRM protected content with silverlight streaming was released during the weekend – and it's called PlayReady Server SDK. There are two distinct license agreements depending on your needs – one for developing PlayReady Server Applications (the SDK itself) and another for deploying a PlayReady Service. About the bucks – no, it's not free: for developing applications, 30.000$ one time license fee is needed; for the deployment, an additional 30.000$ processor fee OR a 0.001$/license fee is needed. For qualified customers a 120 days eval period is given as well for testing and evaluating. Another possibility is to license the SDK as an ISV to build WPF applications that could process content protected with PlayReady.
The DRM technology itself is existing since 1999 – and PlayReady technology was later introduced to fullfit the ever increasing need for mobile instrumentation. Silverlight not being a mobile only technology (don't forget – sooner or later it comes to a phone near you, whether it is a Nokia or Smartphone), but thin enough to be a target platform for this technology. In the very soon future the technology will evolve to support literally anything from H.264 to AAC on any PlayReady compatible device and technology.
And now the fun part – how it works?
Silverlight DRM is a small, cross-platform version of the PlayReady client used exclusively by the Silverlight Web browser plug-in. Analogous to other online content services, a Silverlight service that offers protected content uses the PlayReady Server SDK to first encrypt the content. The first time a client tries to playback a protected media comes the individualization feature of the server – it binds the DRM client to the computer it was installed. Client is then authorized to connect to the license server and acquire a license – valid for the duration of the browser session. So every end-user is given an individualized Playready component and different certified license keys. This significantly reduces the danger of global breaks. If a specific version of a PlayReady client becomes compromised, it can be barred from acquiring licenses for new digital media files unless the latest version of the PlayReady client is downloaded that is robust against the circumvention.