MPEG LA, the group of patent holders for MPEG-4, has reached an
agreement on final licensing terms for the media delivery standard.
MPEG-4 is the audio and video technology that allows the fast
transfer of large digital files through the web, by condensing them
to smaller ones.
According to the licensing terms, owners of web site content
will be able to licence the new video and audio compression format
for $0.25 per subscriber, subject to an annual cap of $1,000,000.
The fees will be applicable to web site operators that use the
technology for commercial purposes, such as paid advertisements,
pay-per-view services or subscriptions. There will be no royalty
for operators with fewer that 50,000 subscribers.
The licensing terms will apply different models to different
business environments. Cable and satellite providers will be
charged on an onetime rate, and mobile phone operators will pay the
same fee as internet providers.
Content owners will be given the option to pay $1 million
annually in order to avoid reporting on usage. This term applies to
a single legal entity, so that owners will not have to treat their
on-line properties separately.
A spokesman for MPEG Requirements said that the technology needs
to be adopted on the internet, since was created to be used in
multiple markets. He added: “If the terms are acceptable for the
markets, MGEP will take off big time. If not, it will be a serious
impediment. MPEG-4 doesn’t exist in a vacuum. It has to be
economically feasible, too.”
