05.23.2004 12:00 PM
MPEG LA announces final AVC/H.264 license terms

MPEG LA has announced that AVC patent holders have agreed on final license terms to be included in the AVC Patent Portfolio License scheduled to be issued in June. While many of the terms are the same as those announced in a November 17, 2003, press release, one major change involves terrestrial broadcasters.

A principal change involves the sublicense for Free Television AVC Video. Formerly limited only to over-the-air broadcasting, Free Television AVC Video now refers to AVC Video that constitutes television broadcasting which is sent by an over-the-air, satellite and/or cable transmission; is not paid for by an end user; and does not constitute Title-by-Title AVC Video, Subscription AVC Video or Internet Broadcast AVC Video (covered by other sections of the license). The party (e.g., a broadcaster) which is identified as providing free Television AVC Video service is the licensee and assumes responsibility for the applicable royalties.

The license now provides two royalty options for licensees of Free Television AVC Video. Added is a one-time fee option of $2500 per AVC transmission encoder (applies to each AVC encoder which is used by or on behalf of a licensee in transmitting AVC video to the end user).

These one-time fees will be offered as an alternative to annual fees (which have been modified since the November 17, 2003, press release) starting at $2500 per calendar year for each broadcast market which includes at least 100,000 but no more than 499,999 households; $5000 per calendar year for each broadcast market which includes at least 500,000 but no more than 999,999 households; and $10,000 per calendar year for each broadcast market which includes 1,000,000 or more households.

The first term of the license runs through 2010, but it will be renewable for additional five-year terms for the life of any portfolio patent; and royalties will not increase by more than 10 percent at each renewal.

For more information, visit: www.mpegla.com.

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