<story><title>An Invisible Tax on the Web: Video Codecs (2018)</title><url>https://blog.mozilla.org/blog/2018/07/11/royalty-free-web-video-codecs/</url></story><parent_chain></parent_chain><comment><author>gnicholas</author><text>Some interesting details on how the H.264 patents are priced, from an article [1] about how much Google pays. Google had threatened to pull H.264 support circa 2011, but ultimately they decided in 2013 to pay a few million bucks&amp;#x2F;yr to keep it.&lt;p&gt;IIRC, H.264 is one of a few non-Google technologies that is included in Chrome, but is not included in Chromium.&lt;p&gt;&amp;gt; &lt;i&gt;So, how much does those rights cost? Under the terms in place for 2011-2015, the royalty rates are the same regardless of whether a product is part of an OS. There&amp;#x27;s no royalty for the first 100,000 units of a licensed product; sublicensees pay 20 cents per unit up to 5 million and 10 cents per unit above 5 million. The current agreement includes an annual limit: “The maximum annual royalty (‘cap’) for an Enterprise [is] $6.5 million per year in 2011-2015.”&lt;p&gt;What happens in 2016? Under the MPEG LA license, the terms are &amp;quot;renewable for successive five-year periods … on reasonable terms and conditions.” The per-copy royalty rates &amp;quot;will not increase by more than 10% at each renewal.” If rates go up by the maximum 10% for that five-year period, the cost of 10 million licenses will increase by $150,000 from a current rate of $1.48 million to $1.63 million.&lt;p&gt;There&amp;#x27;s a small gotcha in the new MPEG LA license agreement. Footnote 17, which appears in tiny print at the very end of the summary of license terms, notes that “Annual royalty caps are not subject to the 10% limitation.” Although that sounds like a loophole, it really only affects the largest players in the market.&lt;/i&gt;&lt;p&gt;1: &lt;a href=&quot;https:&amp;#x2F;&amp;#x2F;www.zdnet.com&amp;#x2F;article&amp;#x2F;a-closer-look-at-the-costs-and-fine-print-of-h-264-licenses&amp;#x2F;#:~:text=Although%20the%20license%20agreement%20uses,until%20the%20end%20of%202015&quot; rel=&quot;nofollow&quot;&gt;https:&amp;#x2F;&amp;#x2F;www.zdnet.com&amp;#x2F;article&amp;#x2F;a-closer-look-at-the-costs-and...&lt;/a&gt;.</text></comment>
<story><title>An Invisible Tax on the Web: Video Codecs (2018)</title><url>https://blog.mozilla.org/blog/2018/07/11/royalty-free-web-video-codecs/</url></story><parent_chain></parent_chain><comment><author>akersten</author><text>It&amp;#x27;s incredible that the MPEG-LA mafia has gotten away with &lt;i&gt;23 patents&lt;/i&gt; on a system of mathematical operations. Math is explicitly outlined as non-patentable. While this extends to all software patents, I&amp;#x27;m astounded that even this very narrow case hasn&amp;#x27;t been challenged on its face. We can&amp;#x27;t move to unencumbered codecs quickly enough.</text></comment>