H.264 to remain free until 2016 for web video

Chris White 6 Feb, 2010 at 2:51pm ET Article published in Tech

We’ve previously talked about HTML5 video and the fight between the H.264 codec and the open source—and arguably inferior—Ogg Theora. The debate stems from the licensing fees associated with H.264, and the unwillingness of companies to foot the hefty bill. The MPEG LA has seemingly realized that it isn’t in their best interest to charge through the nose for the use of the format, and have now announced that the license to stream free content to users will remain royalty-free for internet video until 2016.

Initially, this is good for the consumer, as we may finally see browsers adopt and standardize around a single codec. Dangerously, however, the MEPG LA has not announced what kind of pricing we will see after the moratorium has ended, and all the many video sites have become dependent on their H.264 for HTML5 video. Come 2016, the MPEG LA could conceivably (and easily) submarine sites like YouTube with outrageous fees under threat of revoking their H.264 license. Failure to pay that license would directly impact customers, as a site could no longer stream its H.264-encoded content legally.

On the one hand, this may give competitors like Ogg Theora time to shape up a more mature alternative, but it could just as easily suffocate any and all competition right out of the market. With the H.264 patent set to expire in 2028 there’s a lot of potential for MPEG LA to own a very lucrative market. Or, they could just as easily decide to be the benevolent altruists giving away their goods for as long as world needs it. We’re not holding our breath.

Comments

6 Feb 2010 ~ 4:58pm Snarkasm Free for sites that deliver video to end users. You still have to pay to license the implementation for the browser at all. And it isn't that Mozilla's unwilling to foot the bill - it's that they couldn't do that to their downstream communities. They can't pay the 5 million for a license and then give out Firefox to other places, because then THOSE places would have to pay 5 million for a license, or figure out how to cut the h.264 implementation out of the browser.

A proprietary standard is bad for the internet.
6 Feb 2010 ~ 6:40pm ardichoke I hate all this "arguably inferior" stuff about ogg. The codec is solid and does an excellent job of encoding video. The only problem that I've heard of is it has is that it uses a bit more resources than h.264. Ogg runs better on my netbook than flash though, so even that can't be much of a problem.
6 Feb 2010 ~ 6:44pm Linc @ardichoke - "a little more resources" matters a LOT in scaled implementations like YouTube, Viddler, Vimeo, etc.

I regard this as a political play for becoming the HTML5 de-facto standard. It's a trap.
6 Feb 2010 ~ 6:57pm chrisWhite You're right Matt, update pending.

I do still think with enough money Mozilla could work something out with MPEG LA. But I can understand that they are pushing the standard on principle.

@Ardichoke, I stand by the arguable inferior comment, I've seen very nice results from Ogg Theora at similar bit-rates but that seems to be the exception by people who really know how to encode it correctly. In terms of usability H.264 gives better results with less tweaking making more accessible to more content creators who may not understand the complex art of encoding. While encoding tools are getting better at hiding that stuff from the user it's still an issue. H.264 has a lot more maturity on it's side even if it may not be better in pure technical terms of image quality vs. bit-rate and resources.
6 Feb 2010 ~ 7:07pm ardichoke

Lincoln wrote:

@ardichoke - "a little more resources" matters a LOT in scaled implementations like YouTube, Viddler, Vimeo, etc.

I regard this as a political play for becoming the HTML5 de-facto standard. It's a trap.

Except that the extra resources are on the decode side of things. Decoding doesn't happen server side, it happens client side. If my netbook is able to decode streaming Ogg video without a problem, it's pretty safe to say any modern computer can. As for it being a trap, I agree there.
6 Feb 2010 ~ 7:35pm Thrax Ogg isn't ready for the big time. H.264 compresses better, offers better psychovisual quality, has more options and features and, due to better compressibility, is a vastly better choice for a site carrying terabytes of video.

Oh, hardware decoders won't touch Ogg.
6 Feb 2010 ~ 7:42pm ardichoke If the option is Ogg or $5k annual licenses, I'll take Ogg. I also really don't notice great benefits of h.264. Maybe I'm just not enough of a videophile but h.264 encoded videos don't look any better to me than a good Xvid 2-pass encode or an ogg encode all at the same file sizes.
6 Feb 2010 ~ 10:19pm MachineDog I can definitely notice the difference between xvid and h.264, but between theora and h.264 the main difference is going to be performance on mobile platforms. Google is not going to re-encode all of youtube to theora, so it's simply not going to happen. It's a bad situation for everyone involved, to be honest. I almost think the best solution is for Adobe to pay out the ass for the license fees, since open source isn't particularly compatible with proprietary license fees. This is why the Google Chrome binaries have h.264 support baked in but the Chromium project repositories do not, even though Google is paying for it.
6 Feb 2010 ~ 10:48pm photodude as fast as things change, I would expect something better to come down the pipe and replace H.264 before 2016. I expect the whole h.264 licensing to mostly be relevant to legacy applications in 2016.
6 Feb 2010 ~ 10:53pm Linc

photodude wrote:

as fast as things change

I have only one thing to say: IE6.
6 Feb 2010 ~ 10:56pm chrisWhite @Ardi, Can't tell the difference between Xvid and H.264? Have you looked at the shadows?

@MachineDog, oh, I had never realized H.264 wasn't in Chromium when I've used it, interesting.

@photodude, I hope so, but H.264's been king for a while now, I wouldn't be surprised to see it last a few more years.
7 Feb 2010 ~ 2:00pm drasnor Don't we have antitrust legislation for this sort of thing?

-drasnor
7 Feb 2010 ~ 2:43pm Thrax There's nothing antitrust about it.
7 Feb 2010 ~ 2:57pm drasnor By standardizing on a proprietary codec, W3C gives MPEG LA a de facto monopoly on streaming video technology on the web. Chris says as much in the article.

chrisWhite wrote:

Dangerously, however, the MEPG LA has not announced what kind of pricing we will see after the moratorium has ended, and all the many video sites have become dependent on their H.264 for HTML5 video. Come 2016, the MPEG LA could conceivably (and easily) submarine sites like YouTube with outrageous fees under threat of revoking their H.264 license. Failure to pay that license would directly impact customers, as a site could no longer stream its H.264-encoded content legally.
...
With the H.264 patent set to expire in 2028 thereâ€™s a lot of potential for MPEG LA to own a very lucrative market.

This is a perfect example of predatory pricing and is illegal in most countries.

-drasnor
7 Feb 2010 ~ 3:13pm Thrax IANAL, but it is my interpretation of the US' predatory pricing precedents that it doesn't apply in this case, as H.264's leading competitor is free forever. That is, if a market entrant or competitor has the potential, through superior prices, to upset the supracompetitive pricing that follows a predatory pricing scheme, then there is no grounds for a claim.
7 Feb 2010 ~ 3:43pm drasnor IANAL either, but I'm pretty sure that many companies that would be forced to pay licensing fees to maintain standards compliance will have a few of them and they will definitely make a go at trying to dodge this bullet. I'd even give them a pretty good chance of success.

-drasnor
7 Feb 2010 ~ 3:44pm Thrax It's just a guess, but I don't think the HTML5 spec will ever standardize on a codec.
7 Feb 2010 ~ 4:59pm chrisWhite At least not officially, it just may own the market by sheer popularity and browser support.
7 Feb 2010 ~ 5:25pm ardichoke

chrisWhite wrote:

@Ardi, Can't tell the difference between Xvid and H.264? Have you looked at the shadows?

like I said, I'm not a videophile. I don't sit there analyzing every little aspect of the video to look for flaws. Back when I used to bother ripping all my DVDs so I had a backup (years ago) I used to use XviD 2-pass encoding and had a set of tweaked options that I liked quite well. By the time I was done I had a 700MB file for most sub 2-hour movies and while I could tell the difference between the DVD and the rip, it wasn't anywhere near enough of a difference for me to care.

Most people won't be able to tell the difference between Theora and H.264 in practice. If you videophiles want to pay 5k/year or more for slightly better streaming video of people getting hit in the dick, feel free, don't drag the rest of us down with you though. Further, what are the chances of sites like Hulu or Joost actually using HTML5 video anyway? It's easier for them to use Flash because they need to embed a changing rotation of ads into their content. AFAIK HTML5 video can't do that.
7 Feb 2010 ~ 11:25pm chrisWhite Your $5K/year number is obsolete until 2016.

Dead on about Flash though, but HTML5's really new and I think we've yet to see what it's really capable of.
14 Feb 2010 ~ 5:23am ims If flash videos will use Theora, then "gnash" and "swfdec" would work without any restricted extras. Think of OLPC. My opinion is that there should be two sides well separated: youtube . com and youtube . floss ...or something similar. Like in religion. The floss should be only with GPL licensed codecs.
14 Feb 2010 ~ 6:31am Snarkasm No way would any business separate their content and reencode it just to have a FOSS mirror of their original content. That's just silly.
14 Feb 2010 ~ 8:32pm chrisWhite Agreed, that would be obscenely expensive to maintain.
26 Feb 2010 ~ 7:58am Catalin Free but not free because after this period the license fees will be even higher.

Catalin
Professional Streaming Consultant