[opendtv] PR: MPEG LA Announces Final AVC/H.264 License Terms
- From: Craig Birkmaier <craig@xxxxxxxxx>
- To: OpenDTV Mail List <opendtv@xxxxxxxxxxxxx>
- Date: Wed, 19 May 2004 10:35:18 -0400
MPEG LA Announces Final AVC/H.264 License Terms;=20
=46inal License Agreement to Issue in June
May 19, 2004 12:00am
Source: Business Wire
Business Wire: DENVER--(BUSINESS WIRE)--May 18,=20
2004--MPEG LA, LLC today announced that AVC=20
essential patent holders have agreed on final=20
terms of license to be included in the AVC Patent=20
Portfolio License ("License") scheduled to issue=20
in June. While many of the terms will be the same=20
as those announced in a November 17 press release=20
(http://www.mpegla.com/news/n_03-11-17_avc.html),=20
there are some changes. A summary of the final=20
terms is attached.
In order to assure the worldwide applicability=20
of the License, a principal change involves the=20
sublicense for "Free Television AVC Video"=20
(http://www.mpegla.com/news/n_04-03-24_avc.html).=20
=46ormerly limited only to over-the-air=20
broadcasting, "Free Television AVC Video" now=20
refers to AVC Video that constitutes television=20
broadcasting which is sent by an over-the-air,=20
satellite and/or cable Transmission, is not paid=20
for by an End User and does not constitute=20
Title-by-Title AVC Video, Subscription AVC Video=20
or Internet Broadcast AVC Video (covered by other=20
sections of the License). The party (e.g., a=20
broadcaster) which is identified as providing=20
=46ree Television AVC Video service is the Licensee=20
and assumes responsibility for the applicable=20
royalties.
The License now provides two royalty options for=20
Licensees of Free Television AVC Video. Added=20
since the November 17 press release is a one-time=20
fee option of $2,500 per AVC transmission encoder=20
(applies to each AVC encoder which is used by or=20
on behalf of a Licensee in transmitting AVC video=20
to the End User). These one-time fees will be=20
offered as an alternative to annual fees (which=20
have been modified since the November 17 press=20
release) starting at $2,500 per Calendar Year for=20
each Broadcast Market which includes at least=20
100,000 but no more than 499,999 Households,=20
$5,000 per Calendar Year for each Broadcast=20
Market which includes at least 500,000 but no=20
more than 999,999 Households, and $10,000 per=20
Calendar Year for each Broadcast Market which=20
includes 1,000,000 or more Households. "Broadcast=20
Market" refers to the geographic area within=20
which an End User could use an AVC Decoder to=20
view Free Television AVC Video sent by a single=20
transmitter or transmitter simultaneously with=20
repeaters by a single Legal Entity.
It is recognized that broadcasters in developing=20
countries may have different circumstances to be=20
considered. It is also recognized that there may=20
be AVC Video services that qualify as Free=20
Television AVC Video rather than Subscription AVC=20
Video or Title-by-Title AVC Video where a nominal=20
(but no other) payment is required or where other=20
relevant circumstances taking into account the=20
nature of the video service may apply.
The first term of the License runs through 2010,=20
but it will be renewable for additional 5-year=20
terms for the life of any Portfolio patent; and=20
royalties will not increase by more than 10% at=20
each renewal.
Owners of essential patents that expect to=20
participate in the AVC Patent Portfolio License=20
include Columbia Innovation Enterprises;=20
Electronics and Telecommunications Research=20
Institute; France Telecom, S.A.; Fujitsu Limited;=20
General Instrument Corporation, d/b/a Motorola's=20
Broadband Communications Sector; Matsushita=20
Electric Industrial Co., Ltd.; Microsoft=20
Corporation; Mitsubishi Electric Corporation;=20
Koninklijke Philips Electronics, N.V.; Robert=20
Bosch GmbH; Samsung Electronics Co., Ltd.; Sharp=20
Kabushiki Kaisha; Sony Corporation; Toshiba=20
Corporation; and Victor Company of Japan,=20
Limited. In addition, the following companies=20
with essential patent applications that=20
participated in the deliberations concerning=20
these license terms also expect to participate in=20
the License if they are determined to have an=20
essential patent: LG Electronics, Inc., LSI Logic=20
Corporation and Polycom, Inc.
MPEG LA continues to welcome the submission of=20
issued patents for an evaluation of their=20
essentiality to the AVC Standard in order to=20
include as much essential intellectual property=20
as possible under one license for the benefit of=20
the marketplace. See "Programs in Development" at=20
http://www.mpegla.com. For each patent submitted,=20
an evaluation fee of US $8,500.00 to cover the=20
outside cost of the patent expert's evaluation is=20
paid to MPEG LA. Additional fees may be required=20
to cover additional outside costs in the event of=20
reevaluation by patent experts. Submitting=20
parties must confirm their agreement with the=20
terms and procedures governing the patent=20
submission process which may be obtained from=20
Jane Tannenbaum, Director, Contract=20
Administration (jtannenbaum@xxxxxxxxxx).
MPEG LA, LLC
MPEG LA successfully pioneered one-stop=20
technology platform licensing with a portfolio of=20
essential patents for the international digital=20
video compression standard known as MPEG-2.=20
One-stop technology platform licensing enables=20
widespread technological implementation,=20
interoperability and use of fundamental=20
broad-based technologies covered by many patents=20
owned by many patent holders. MPEG LA provides=20
users with fair, reasonable, nondiscriminatory=20
worldwide access to essential patents from=20
multiple patent holders in a single transaction=20
as a non-exclusive alternative to entering into=20
separate license agreements with individual=20
patent holders. MPEG LA is not related to any=20
standards agency and is not an affiliate of any=20
patent holder. In addition to MPEG-2, MPEG LA=20
licenses portfolios of essential patents for the=20
IEEE 1394 Standard, the DVB-T Standard, the=20
MPEG-4 Visual Standard and the MPEG-4 Systems=20
Standard. MPEG LA also is facilitating licenses=20
for the AVC/H.264 Standard, DRM Reference Model v=20
1.0 and the VC-9 Specification. For more=20
information, please refer to=20
http://www.mpegla.com, http://www.1394la.com and=20
http://www.dvbla.com.
Attachment
The licensing terms outlined below are for=20
informational purposes only. They are not an=20
offer to license and may not be relied upon for=20
any purpose. The AVC Patent Portfolio License=20
scheduled to be available at the beginning of=20
this summer will provide the actual terms of=20
license on which users may rely.
1. Decoder-Encoder Manufacturer Sublicenses
-- AVC products sold by a legal entity to end=20
users and as branded OEM for PC but not sold as=20
part of a PC Operating System (decoder, encoder=20
or product consisting of one decoder and one=20
encoder =3D "unit")
0 - 100,000 units/year =3D no royalty (available=20
to one legal entity in an affiliated group)
US $0.20 per unit after first 100,000 units each year
Above 5 million units/year, royalty =3D US $0.10 per unit
Maximum annual royalty ("cap") for Enterprise=20
(commonly controlled legal entities): $3.5M per=20
year 2005-2006, $4.25M per year 2007-08, $5M per=20
year 2009-10
-- Legal entity selling branded AVC products OEM=20
for PC OS may pay for its customers as follows:
0 - 100,000 units/year =3D no royalty (available=20
to one legal entity in an affiliated group)
US $0.20 per unit after first 100,000 units/year
Above 5 million units/year, royalty =3D US $0.10 per unit
Enterprise cap: $3.5M per year 2005-2006, $4.25M=20
per year 2007-08, $5M per year 2009-10
-- Includes right to make, sell and personal use=20
by or between end users such as in connection=20
with a video teleconference or mobile messaging=20
(but not uses covered by #2 below)
-- Royalties begin January 1, 2005
2. Participation Fees
-- Where End User pays directly for AVC Video
Title-by-Title (e.g., where viewer determines=20
titles to be viewed or number of viewable titles=20
are otherwise limited) - 12 minutes of AVC Video=20
or less =3D no royalty; greater than 12 minutes in=20
length, royalty payable is the lower of (a) 2% of=20
price paid to licensee on first arms length sale=20
of the video or (b) $0.02 per title. Categories=20
of licensees include legal entities that are (i)=20
replicators of physical media, and (ii)=20
service/content providers (e.g., cable,=20
satellite, video DSL, Internet and mobile) of=20
VOD, PPV and electronic downloads to end users.
Subscription (not limited by title) per legal=20
entity (e.g., service or content provider) that=20
sells AVC video to the end user for remuneration=20
- 100,000 or fewer subscribers per year =3D no=20
royalty (available to one legal entity in an=20
affiliated group); greater than 100,000 to=20
250,000 subscribers per year =3D $25,000; greater=20
than 250,000 to 500,000 subscribers per year =3D=20
$50,000; greater than 500,000 to 1M subscribers=20
per year =3D $75,000; greater than 1M subscribers=20
per year =3D $100,000.
-- Where remuneration is from other sources
Free Television AVC Video - (a) one-time $2,500=20
per transmission encoder or (b) annual fee per=20
broadcast market starting at $2,500 per Calendar=20
Year per Broadcast Markets of at least 100,000=20
but no more than 499,999 Households, $5,000 per=20
Calendar Year per Broadcast Market which includes=20
at least 500,000 but no more than 999,999=20
Households, and $10,000 per Calendar Year per=20
Broadcast Market which includes 1,000,000 or more=20
Households.
Free Internet Broadcast (not title-by-title, not=20
subscription) - no royalty during first term=20
(through 2010), and royalty thereafter shall not=20
exceed the Free Television AVC Video fees for the=20
period after 2010.
-- Enterprise cap: $3.5M per year 2006-07,=20
$4.25M per year 2008-09, $5M per year 2010
-- Royalties begin January 1, 2006
3. General Terms
-- First term through 2010
-- Renewable for additional 5-year terms for life of patents
Rate protected - royalties will not increase by more than 10% at each rene=
wal
CONTACT: MPEG LA, LLC Lawrence Horn, 301-986-6660=20
=46ax: 301-986-8575 lhorn@xxxxxxxxxx KEYWORD:=20
COLORADO JAPAN GERMANY NETHERLANDS INTERNATIONAL=20
ASIA PACIFIC EUROPE INDUSTRY KEYWORD: HARDWARE=20
COMPUTERS/ELECTRONICS CABLE TELEVISION/RADIO=20
MARKETING AGREEMENTS SOURCE: MPEG LA, LLC=20
Customize your Business Wire news & multimedia to=20
match your needs. Get breaking news from=20
companies and organizations worldwide. Logon for=20
=46REE today at www.BusinessWire.com. .end=20
(paragraph)<<Business Wire -- 05/18/04>>
<< Copyright =A92004 Business Wire >>
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