4 ms·

> MPEG LA has a royalty cap so that companies selling high-volume products know beforehand the maximum amount of royalties they'll have to pay to MPEG LA in a g

> MPEG LA has a royalty cap so that companies selling high-volume products know beforehand the maximum amount of royalties they'll have to pay to MPEG LA in a given year. The current $5 million cap really isn't much for a big player possibly generating many billions of annual revenues with products that include an AVC/H.264 encoder and/or decoder. http://fosspatents.blogspot.com/2010/06/mpeg-las-avch264-licensing-terms.html http://fosspatents.blogspot.com/2010/06/mpeg-las-avch264-lic...

magicalist 16y ago
leaving google aside, I think it's pretty obvious that the "royalty-free codec" that entities like Mozilla are looking for is pretty incompatible with "but there's a cap on the royalties." hence the <video> situation we were in even before last week and google's blog post.
- deleted 16y ago
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alanfalcon 16y ago
The cap is $6.5 million for the next five years and then there is no limit on how much it could be raised after that. The royalties can't be raised more than 10% every five year period, but the cap isn't under that restriction.
ZeroGravitas 16y ago
I would suggest the reason they have a cap is because a) it is anti-competitive towards smaller firms moving into the market to challenge the incumbents who make up MPEG-LA b) it would make economic sense for a bunch of big companies to get together and produce a competitive codec and compete with H.264 if they didn't structure their fees in this way. They are after all a government sanctioned cartel. You don't get away with this kind of anti-competitive price discrimination otherwise. Which is why it always confuses me that people talk about what an excellent codec it is. How do you know it's excellent when the legal structures are set up specifically to exclude competition, and therefore comparison?

4 ms·

> MPEG LA has a royalty cap so that companies selling high-volume products know beforehand the maximum amount of royalties they'll have to pay to MPEG LA in a g

by wallflower 16y ago

magicalist 16y ago
leaving google aside, I think it's pretty obvious that the "royalty-free codec" that entities like Mozilla are looking for is pretty incompatible with "but there's a cap on the royalties." hence the <video> situation we were in even before last week and google's blog post.
- deleted 16y ago
  [deleted]
alanfalcon 16y ago
The cap is $6.5 million for the next five years and then there is no limit on how much it could be raised after that. The royalties can't be raised more than 10% every five year period, but the cap isn't under that restriction.
ZeroGravitas 16y ago
I would suggest the reason they have a cap is because a) it is anti-competitive towards smaller firms moving into the market to challenge the incumbents who make up MPEG-LA b) it would make economic sense for a bunch of big companies to get together and produce a competitive codec and compete with H.264 if they didn't structure their fees in this way. They are after all a government sanctioned cartel. You don't get away with this kind of anti-competitive price discrimination otherwise. Which is why it always confuses me that people talk about what an excellent codec it is. How do you know it's excellent when the legal structures are set up specifically to exclude competition, and therefore comparison?