Perspectives on the digital video world from JW Player’s SVP of Technology
Earlier this month, HEVC Advance announced changes to their royalty fees for commercial use of the HEVC video compression standard. In short, these changes will make it essentially free to distribute video content on the Internet using the HEVC codec. Previously the content royalty rate was a complex matrix of rates by content type (subscription, title-by-title, etc), but it boiled down to potentially millions of dollars per year.
The HEVC Advance device royalties remain, but they have been discounted. As always, Jan Ozer provides an excellent summary.
These changes are great news, and most likely a result of growing industry backing for AV1, a royalty-free codec being developed by Google, Amazon, Apple, Netflix, and others. Indeed, even if AV1 as a technology flops, it will have won a significant victory for the industry by pressuring HEVC Advance to cut fees.
What is HEVC Advance, you ask? To use HEVC commercially, you must pay royalties to companies (or universities) whose patented techniques are used in the standard. These payments are required even if you are using open-source implementations of HEVC. For AVC (HEVC's predecessor), a single company called MPEG LA collected these royalties and distributed them to the patent owners.
In the case of HEVC, however, three such "pools" have sprouted up--MPEG LA, Velos Media, and HEVC Advance. Of the three pools, HEVC Advance's fees were the highest. (Well, as far we know, because Velos has never published their rates.) To make things even less clear, companies such as Technicolor have foregone membership in all the pools to collect their own royalties independently (also unpublished).
The result has been uncertainty and confusion among companies who are considering using HEVC, not only around how much money must be paid now, but around the risks of future royalties if a new pool or patent holder emerges demanding yet more royalties. The situation is so bad that the long-time chairman of MPEG (the group that standardized HEVC) called it "tragic" and "a crisis."
So while the HEVC Advance changes are welcome, they might have arrived too late to gain the confidence of browser makers, device manufacturers, and other implementers to adopt HEVC.
As as result, we still find ourselves waiting for AV1 to save the day (it was officially released yesterday, in fact), but I fear that is going to take much longer than people hope. For more on that subject, see my previous post.
John Luther is JW Player’s SVP of Technology.
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