10 questions for MPEG LA on H.264

5. If a Web site were to present a video produced using H.264 as an advertisement for a product or service sold commercially through that site, is that considered a commercial use of the codec, and if so, who's responsible (and for how much, if you can say)?

MPEG LA: Assuming there is no remuneration for the video itself (in this case, an advertisement), this would fall under "Internet Broadcast AVC Video." The Web site would benefit from being a Licensee to our AVC License, but would not need to pay a royalty for the distribution of such video at least the license term ending December 31, 2015.

6. When an independent producer wishes to legitimately sell (or make commercial use of) a video or movie produced using technologies in MPEG LA's portfolio, how does this producer make arrangements with MPEG LA?

MPEG LA: For more information about MPEG LA's AVC License or to request a copy of the License, the producer should visit this page.

7. Since a plug-in technology such as Adobe Flash (which utilizes H.264) may or may not be used by viewers in the processing of videos that were distributed commercially, and for which royalties were apparently paid, why is Adobe responsible for royalties also? And why would the manufacturer of a (hypothetical) H.264 codec plug-in for Mozilla Firefox be responsible as well?

MPEG LA: As explained earlier, Adobe is considered a seller of its AVC Product, and Adobe would benefit from coverage under our AVC License. The royalties owed, if any, would depend on the number of units Adobe distributed during a calendar year: 100,000 or fewer units/year = no royalty; 100,001 ??" 5,000,000 units/year = US$0.20/unit; 5,000,001+ units/year = $0.10/unit, with a cap of $5 million in 2010. Adobe and Mozilla would be responsible for paying the royalty as described above since they are the providers of the AVC Products.

8. Some are under the understanding that when an open source, non-commercial codec that does not use H.264 is used in the processing or creation of videos that may be playable in consoles or with devices or software that utilize H.264, the creator of that codec is not responsible for royalties to MPEG LA. In other words, if a developer avoids the use of H.264 technology to create a video that a true H.264 codec recognizes as compatible, no charges apply. Is that accurate, and why or why not?

MPEG LA: By definition, an H.264 video is playable using an H.264 codec. To the extent that is true, coverage is provided and applicable royalties are payable under the AVC License.

9. Is there any reason for individuals to suspect that, if today they happen to use technology that attempts to be compatible with H.264, and that is later found to infringe upon MPEG LA patents, the individual users themselves (the viewers and producers of videos using infringing codecs) would become liable for unpaid royalties?

MPEG LA: As answered in #2 above, the consumer, or end user, is not responsible for concluding our AVC License or paying a royalty. However, as also explained in #1 above, when the encoders/decoders are used to provide AVC video content to an end user, the provider of such video service will benefit from coverage under the AVC License.

10. Under current US law, an Internet service provider is granted "safe harbor" against liability for copyright infringement, if the system with which videos or other content is hosted there, or flows through their channels, is automatic and without the ISP's intervention. That law is said to apply to YouTube (and thus Google) when videos from a major content producer (such as Viacom) are uploaded there (although Viacom is, of course, challenging this). But it's my understanding that Google is a payer of royalties to MPEG LA and others, for the use of H.264 in the display of YouTube videos, which may include content where it's protected against copyright infringement. Why do royalties apply to the providers of videos which may include not only non-commercial works but non-authorized or illicit ones as well?

MPEG LA: Google is responsible for the use of patents in connection with any distribution of AVC video content that occurs on its Web site because its Web site is where the transaction took place with the end user, regardless of who supplied the video or whether the video infringed anyone's copyright.