posted by Thom Holwerda on Sat 5th Mar 2011 11:46 UTC, submitted by lemur2
IconWell, this rumour, coming from the reputable Wall Street Journal, isn't entirely unsurprising. Apparently, the omnipotent people familiar with the matter have told the WJS that the US Department of Justice and the California State Attorney General's office are investigating the MPEG-LA for possible anti-competitive practices regarding VP8.

According to The Wall Street Journal's sources, the problems stems from the MPEG-LA creating legal uncertainty over the status of Google's VP8. "Antitrust enforcers are investigating whether MPEG LA, or its members, are trying to cripple an alternative format called VP8 that Google released last year - by creating legal uncertainty over whether users might violate patents by employing that technology," the sources told the WSJ.

So basically, the DoJ would be investigating the MPEG-LA for spreading FUD. If the acronym 'FUD' appears in any of their official reports, it's already a win - whether they actually find something or not.

The DoJ, the California State Attorney General's office, Apple, Google, and Microsoft all declined to comment, but the confirmed patent troll Larry Horn, CEO of MPEG-LA, did have something to say. "We are effectively a convenience store" for licensing patents, he told the WSJ, "We have no dog in that fight."

Which is a lie, of course. The MPEG-LA's business model consists of them providing easy access to the various patents covering - in this specific case - H264. While part of that money goes to the actual patent holders, it's obvious the MPEG-LA keeps a share for itself. If the web were to move to a format for web video that doesn't require anyone to pay the MPEG-LA - they'll be missing income. Stating they don't have a dog in this fight is a flat-out lie, but then again, what did you expect from a patent troll?

Laws regarding antitrust and monopoly abuse and such can be incredibly obtuse, but fact of the matter is that every video product is pretty much forced to pay protection money to the MPEG-LA; regarding video standards, it's pretty clear they wield monopoly-like power over an entire industry. Whether it actually fits the various legal definitions of what a monopoly is, I don't know.

We're also approaching the point where the MPEG-LA's licensing structure no longer fits the various definitions of open standards as used by governments around the world. The European Union demands any patents part of an open standard be royalty-free, and the UK government, too, recently added royalty-free as a key requirement. This means that depending on where you live, H264 is not an open standard - a decided disadvantage compared to VP8 that the MPEG-LA is trying to overcome.

Not by changing their own product - but by spreading FUD about the others. Even after ten years of empty threats, they still haven't got any patents regarding Thoera or VP8, since they had to ask the industry to send them patents. It's all such thinly veiled attempts at FUD it surprises me there are still people defending the MPEG-LA.

Let's hope the DoJ manages to do something about the MPEG-LA's death grip on the video industry. This organisation is pure poison, led by a known patent troll, and ought to be eradicated.

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