Friday, February 11, 2011

MPEG LA puts Google's WebM video format VP8 under patent scrutiny

A call for submissions issued by MPEG LA, the leading licensing entity for multimedia codecs, may provide a definitive negative answer to Google's claims that the VP8 video codec, which is part of its WebM set of codecs, is free from patent encumbrances.

When Google recently announced that its Chrome browser would drop the ubiquitous H.264 video format in connection with the HTML 5 'video' tag, many experts doubted that such a decision would really tip the scales in favor of Google's WebM/VP8 technology. For example, book author and ZDNet blogger Ed Bott asked whether Google was avoiding a trap or walking into one, and quoted a patent attorney who warned that "[a] codec is like a mechanical device with hundreds of parts. Any one or more could be the subject of a patent."

Google and its allies (particularly Mozilla and Opera) claimed that WebM was royalty-free and, therefore, uniquely suited for use in Free and Open Source Software.

When WebM was announced last spring, I commented somewhat skeptically on the original announcement and on a subsequent license change, and I took a closer look at MPEG LA's license terms for AVC/H.264, the market-leading standard standard supported by an impressive list of major vendors.

"Patent-free" is easier said than done

In my opinion, claiming that a relatively late entrant can be "patent-unencumbered" in a field that's been a patent thicket for many years is just about as realistic as saying that you can walk safely through a minefield. It may be possible, theoretically speaking, but who would actually take the risk without a need?

Of course, anyone can make claims of that kind until there's evidence to the contrary. Some will believe such claims and some others won't even seriously think so but will, for strategic reasons, deny the threat in their public statements as long as they can.

Let me make this very clear: since I'm against software patents, I'd be happy to see a patent-free video codec put competitive pressure on dozens of major patent holders. But I make a clear distinction between what I'd like to see happen and what I consider realistic.

Deadline for submissions of essential patents: March 18

We may now be only a few months away from a definitive and potentially negative answer. Yesterday, MPEG LA published a call for patents essential to the VP8 video codec.

Such a call is the beginning of a formal process that will, if a number of such patents are submitted, most likely result in the creation of a patent pool. MPEG LA's patent pools aren't free of charge. They may allow free-of-charge use of their standards but only for particular purposes. In other words, "free" will be subject to field-of-use restrictions, and everything else will be charged for.

MPEG LA asks for initial submissions to be made by March 18, 2011. The focus will be on actually issued patents, but patent applications that are still being examined may also be submitted if considered essential.

MPEG LA's patent evaluators (legal and technical experts) will analyze all of the submitted patents to determine their "essentiality". In any standardization process, an "essential" patent is understood to be required for an implementation of the standard in question, as opposed to patents that may be somewhat related to it but not absolutely necessary.

A standardization or licensing entity can't be sure that all essential patents were actually submitted. Some patent holders may not be interested in participating. But the goal is to identify as many essential patents as possible.

Commercial negotiations

After the essential patents for a proposed pool have been identified, there is always a negotiation between the contributing patent holders. They have to agree on the terms on which to make the entire pool available to licensees and on their internal revenue-sharing arrangements (which should be reflective of the value of the contributions made by the parties).

I don't know whether MPEG LA will publish the list of patents identified after technical evaluation of all submissions, or only after successful conclusion of commercial negotiations. The latter seems more likely to me. One way or the other, we may only be months away from seeing a list of patents found to read on WebM/VP8.

Should MPEG LA form a VP8-related pool, then they will approach WebM/VP8 adopters and ask for royalty payments. Since MPEG LA is an entity that means business when it comes to patent licensing, their demands for royalties won't just be ignored by commercial players interested in legal certainty. As a result, Google and its WebM allies would have to show that none of the patents identified are valid and infringed. For each patent, the proponents of WebM could either seek invalidation or try to prove that there isn't an infringement issue. Depending on the size and quality of the pool, that can be a formidable or practically insurmountable challenge. So much for free in that scenario...

When it comes to patents, the odds are long against Google

I want to be frank. Despite my dislike for software patents, if I had to bet money, I would bet it on MPEG LA, not on Google.

MPEG LA has a pretty strong track record in codec patent licensing. One may or may not like their business model, but they clearly know what they're doing. By contrast, Google's flagship open source project, Android, has turned out to be a patent suit magnet.

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