Sony is busy settling lawsuits which erupted in several states over installing rogue software onto PC when you try to play one of the company's CDs on your computer.

Are they giving up the battle?

Hardly. They no longer need to install rogue software on your system. They've managed to convince Microsoft to build it into the operating system. Vista has very little to do with creating a version of Windows that is secure from hackers and satisfies the needs of customers. Vista is all about making the world safe for the Zune and pay-per-view. Digital Rights Management has infected every part of the file system, every part of the kernel, every device driver. Every source of media content which enters your computer will be checked against every possible output device. If a device is able to copy your MP3's, it will be disabled in the kernel when an MP3 plays. If it is physically possible to tap into your monitor wires and send the signal to a DVD recorder, your monitor will be forced into 'fuzzy' mode. Sony will no longer have to worry about you downloading illegal copies of movies. Microsoft will refuse to play them. Finally the world will be safe for $75 videos. Think I'm joking? Come back to this page two years from now...

The only thing preventing it is a consumer revolt. So far that hasn't happened. Nobody wants to be a pirate. Right? Everybody enjoys paying 24.95 for a $0.25 piece of plastic, of which the creating artist gets $0.00004 cents. Right? They'll also enjoy paying twice as much for a new monitor that they'll need to watch videos on their computer because their old one isn't trusted by the computer and goes fuzzy watching youtube. The only thing which will work on their computer is a new monitor when being used with the new $75 DVDs. 

Shiver me timbers... Vista is here now. You're going to cuss your next PC upgrade, because that's when it will all start to hit home. It's entirely possible that your current PC will be found to be an untrustable media player in the not-too-distant future. There's nothing preventing the next crop of media from refusing to play on your 'rogue device' and insisting on running under Vista.