What Will the HEVC Royalty Structure Look Like?

No one knows at this point, but I did learn a thing or two at Streaming Media West. By way of background, most authorities agree that there will be royalties on encoders and decoders, just like H.264. However, I was thinking that there might be royalties on free Internet content encoded with HEVC, as well. Two authorities who knew more than I did set me straight.

Here’s the pithy summary from a recent article for Streaming Media Magazine.

Bill Geary, an MPEG LA VP who’s working to help formalize the HEVC group, was in the room and offered to share his observations on the matter. He disagreed, feeling it highly unlikely that the patent group would attempt to impose a royalty on HEVC-encoded free content. After the session, Frost & Sullivan analyst Avni Rambhia shared some insights about why this is so.

Rambhia, who has spoken with many HEVC patent stakeholders, related that most HEVC IP owners also build HEVC encoders, decoders, and related products, and make the bulk of their revenues from the sale of these products, not from royalties. Learning from their experiences with H.264 licensing, they wanted a policy that promoted HEVC usage as much as possible, not one that would prove onerous to prevalent business models. For this reason, she also didn’t expect HEVC royalties to extend to scenarios that H.264 doesn’t currently cover.

For more on the royalty issue, click over to the article. You can watch my presentation at Streaming Media West, entitled, Understanding the Significance of HEVC/H.264, and download the handout, here.

About Jan Ozer

I help companies train new technical hires in streaming media-related positions; I also help companies optimize their codec selections and encoding stacks, and evaluate new encoders and codecs.

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