Why Our Civilization's Video Art and Culture is Threatened by the MPEG-LA
Linked by Eugenia Loli on Sat 1st May 2010 22:17 UTC
Legal We've all heard how the h.264 is rolled over on patents and royalties. Even with these facts, I kept supporting the best-performing "delivery" codec in the market, which is h.264. "Let the best win", I kept thinking. But it wasn't until very recently when I was made aware that the problem is way deeper. No, my friends. It's not just a matter of just "picking Theora" to export a video to Youtube and be clear of any litigation. MPEG-LA's trick runs way deeper! The [street-smart] people at MPEG-LA have made sure that from the moment we use a camera or camcorder to shoot an mpeg2 (e.g. HDV cams) or h.264 video (e.g. digicams, HD dSLRs, AVCHD cams), we owe them royalties, even if the final video distributed was not encoded using their codecs! Let me show you how deep the rabbit hole goes.

UPDATE: Engadget just wrote a reply to this article. The article says that you don't need an extra license to shoot commercial video with h.264 cameras, but I wonder why the license says otherwise, and Engadget's "quotes" of user/filmmaker indemnification by MPEG-LA are anonymous...

UPDATE 2: Engadget's editor replied to me. So according to him, the quotes are not anonymous, but organization-wide on purpose. If that's the case, I guess this concludes that. And I can take them on their word from now on.

UPDATE 3: And regarding royalties (as opposed to just licensing), one more reply by Engadget's editor.

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Umh, seriously?
by Kuukunen on Sun 2nd May 2010 12:55 UTC
Kuukunen
Member since:
2010-03-28

Ok, I'm sorry beforehand, but this post was utter crap laced with very uninformed FUD.

I am not a lawyer, but it seems I've spent more time reading the actual license than pretty much anyone here. So I figured I'd break some of the stuff down.

However, what's "free to stream"? According to the interpretation of the U.S. law, if you stream your video with ads (e.g. Youtube, Vimeo), then that's a non-free usage.

But according to the license terms, "free to stream" means it's free for the end-user and the company can get remuneration through other means.* The other option for internet video is either title-by-title payment or a subscription based arrangement. For title-by-title the company does have to pay 2% or $0.02 per title (videos under 12 minutes are free, though) or for subscription service you have to start paying once you get more than 100,000 subscribers. So no, what you're saying is just FUD.
Since we know for a fact that x264 is breaking the MPEG-LA license agreements (because their devs didn't license it with MPEG-LA), can this make Vimeo, myself the video producer, AND every of these millions of viewers, liable, in the eyes of MPEG-LA?

No, they're not breaking the license agreements. How could they break license agreements if they haven't agreed on a license? ;)
Anyway, there is NOTHING that would prevent people from programming a H.264 encoder. When you want to spread that encoder, it gets a bit harder though. Basically you have to start paying royalties if you "Sell" an "AVC Product". But being legalese, they redefine Selling to even include providing non-commercial free download. AVC Product on the other hand is defined as "product that contains a fully functional AVC encoder and/or decoder". I don't know if a source code you have to compile yourself would qualify as "fully functional" and they're not providing binaries themselves. Other sites are doing that, but that's their problem. (And it's a problem only after 100,000 products "Sold")

Anyway, the answer to your question: No, using x264 can't make you liable.*

Let's go to the main thing that started it:
You can only use your professional camera for non-commercial purposes. For any other purpose, you must get a license from MPEG-LA and pay them royalties for each copy sold.

First of all, at least the two manuals I checked didn't even have it as "license agreement", but more like "Here's what you might want to know about the licensing." And they don't really seem to be enforcing any additional restrictions than what there already are.

Secondly, even if they were adding restrictions, they'd be shrink wrap contracts, which is kind of hazy:
http://en.wikipedia.org/wiki/Shrink_wrap_contract

Anyway, as far as I can tell, there is nothing in the H.264 licenses that would make you pay royalties if you just re-encode your H.264 video into other formats internally and then sell those.* If you don't re-encode and start selling them, of course you need to pay royalties, but I thought we already knew that.


* Ok, one thing about these licenses is that if you ask MPEG LA "Do I need a license for ..." the answer is probably "Yes, you need a license for everything.", even if it wouldn't mean you have to pay any royalties. So yea, even under 100,000 units, or 12 minutes etc etc, in theory you need to make a license agreement with them. It's just that they don't have much interest in it if you don't have to pay them anything. But that's the same with everything these days: Getting sued for using H.264 in a way where you wouldn't even have to pay royalties is pretty much the same threat level of getting sued for using Theora or riding a bike.

So for the next time, please, actually do some research for your articles.

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