Of course, the blob would detect a virtual machine and refuse access to the content.

Actually, some games do that, as they interpret the existence of a VM or developer tools installed as an attempt to decrypt/reverse engineer the game's DRM. Which would be funny if it weren't so sad.

In a more modern version, VM just won't be able to support a hardware-assisted DRM conveniently preinstalled straight into your CPU or video card's firmware.

Hmm. This leads me to the idea. Why care for software rootkits when PCIe hardware may actively screw with the system? Considering MAFIAA already had success with enforcing HDCP on almost every modern video card out there...

I actually just read a book set in 2040 England where this basically happened, they'd created a system where if you tried to remove the hardware the CPU would be dissolved. The book was called "Pirate [something]" I can't remember the exact name but it had pirate in it...

The best I could do after a lot of searching (lots of books with pirate in the title): http://www.amazon.com/Pirate-Cinema-Cory-Doctorow/dp/0765329...

Your description sounds good. This book doesn't sound that good but it is future England, has to do with computers has pirate in the title.

That's it!

The book is okay, I was kinda surprised at how good he was at keeping the tech believable... still he mostly failed as authors who know little about tech do