You are absolutely right. Maybe you shouldn't give their lawyers anymore ideas ^_^ And remember this is going to cost them (us) a ton.
If the audio streams are in a format that Windows Media, Quicktime, Real, etc. can play, but with added data from this company's proprietary protection scheme -- if it isn't part of the published standard -- the companies aren'y bypassing it, they're just not implementing it.
I don't think I completely follow you, but I think the purpose in this law suit is to force them to implement it (and pay for it of course).
Exactly. As far as not following me, I have another analogy. Macrovision -- the most popular method of preventing folks from copying movies by simply plugging a player into a recorder. Macrovision works by blinking the first line of video -- which is behind the bezel and not visible on any consumer TV -- between white and black. That messes with the automatic gain control on the VCR, and tapes copied by amateurs have wild fluctuations between light and dark, as well as color shifts.
If a VCR manufacturer (or the makers of the "black box" things in the back of Popular Science) simply chop off the top line, they're acting in a way that is only useful for the purpose of bypassing copy protection -- and altering the long-standing NTSC spec. The beauty of Macrovision is that it worked within the existing spec, and did not require anyone to add anything. It worked with the vast majority of consumer video equipment in use.
If Media Rights Technologies' copy protection scheme, on the other hand, has not been adopted by the makers of 98% of streaming audio players. My assumption, based on that, is hat it requires added code, and does not use any existing widely-used spec. Ruling that not-buying is the same as bypassing would require everyone to adopt every harebrained DRM idea from anyone who can afford a lawyer. I'll bet a lot of that code would be buggy as hell, essentially making streaming audio unusable.
My guess (just a guess) is that MRT set out with what it thought was a great idea, one they could sell to the big content providers, who could then muscle the software developers into supporting it. Nobody bought. So this is the Hail-Mary as the clock runs out on their financing.