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07.26.15

HEVC Cartel is Not News, Only the Names of Backers and the Costs Are New

Posted in Patents at 2:19 pm by Dr. Roy Schestowitz

HEVC backerSummary: A few remarks on and a roundup of recent articles about HEVC, which we first wrote about in spring

ABOUT a week ago, well before the FOSS community began talking about it (apparently a hot topic over the weekend), we had spotted the latest news about HEVC, a cartel that we first heard about several months ago, well before it had a widely-recognised (for notoriety) name and a now-notorious press release (the respective Wikipedia page goes well over 2 years back, there are semi-official Web sites etc. so it’s not exactly news). Some people in the FOSS/multimedia world knew what was happening, but the details were rather vague at the time. We wrote about this back in April when Monty (the Ogg guy) mentioned it by name and noted the similarities to MPEG-LA. High Efficiency Video Coding (HEVC) had been turning into a patent parasite with its own ‘official’ troll. New patent cartels such as HEVC basically pile up yet more fees (like royalty stacking) and some of the earlier reports said that this one cartel alone (irrespective of the rest) wants “0.5% Of Every Content Owner/Distributor’s Gross Revenue For Higher Quality Video”” [1, 2]. To quote some background: “In March, a new group named HEVC Advance announced the formation of a new patent pool [see: New HEVC Patent Pool Launches Creating Confusion & Uncertainly In The Market] with the goal of compiling over 500 patents pertaining to HEVC technology. The pool of patent holders, which is “expected” to include GE, Technicolor, Dolby, Philips, and Mitsubishi Electric has just announced their royalty rates and are going directly after content owners and CE manufacturers. HEVC Advance wants 0.5% of content owners attributable gross revenue for each HEVC Video type. To put in perspective how unjust and unfair their licensing terms are, they want 0.5% of Netflix, Apple, Facebook, Amazon and every other content owner/distributor’s revenue, as it pertains to HEVC usage. Considering that most content owners and distributors plan to convert all of their videos over time to use the new High Efficiency Video Coding compression standard, companies like Facebook, Netflix and others would have to pay over $100M a year in licensing payments. The licensing terms apply to all content services that get revenue from advertising, subscription and PPV – which pretty much equals every content owner, OTT provider, broadcaster, sports league, satellite broadcaster and cable provider you can think of.”

“A New H.265 Patent Pool Is Causing Concerns” was the headline from Phoronix (a couple of days ago). A lot of people link to that right now. Actually, it’s not news. The site said that “[t]his H.265 patent pool is expected to be backed by GE, Dolby, Philips, and other names. The group, HEVC Advance, is interested in 0.5% of gross revenue from content owners for each HEVC video type. Some details on this patent pool can be found via the Streaming Media Blog. ”

Well, software patents continue to haunt multimedia and many articles about this [1, 2, 3, 4, 5, 6] (it was big new last week) did too little — if anything — to emphasise the horrible impact this can have on Free software.

According to the press release, this entity is “an independent licensing administrator”. Cartel is what it really is. Even Microsoft Peter, promoter of other such patent cartels (like the ones Microsoft is in), said that this one “threatens to derail 4K HEVC video streaming”.

The bottom line is that this is hardly news. It goes back to spring and well beforehand (depending on whether one talks about the patents or the formats/methods), but now we know more about the monetary demands. HEVC workarounds may be needed, just like WebM and Ogg (as Free software substitutes by which to bypass the MPEG cartel). We are likely to hear a lot more about HEVC in years to come.

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