MPEG LA released its Versatile Video Codec (VVC) licensing terms moments before Faultline went to press last week, giving us time to reflect on how these compare with rival VVC/H.266 patent pool Access Advance, which published separate licensing terms in July 2021.

The bottom line for the industry is that any licensee will almost certainly have to take VVC licenses from both pools to avoid any patent infringement lawsuits. The bigger concern, however, is whether a third VVC patent pool will emerge?

We hate to be the bearer of bad news, but we believe a repeat of the three-way HEVC fragmentation nightmare is inevitable – which will ultimately delay VVC adoption.

Ever since the Media Coding Industry Forum (MC-IF) and the ITU-T’s Video Coding Expert Group announced joint plans to encourage a single VVC patent pool, Faultline sensed this was destined to fail. With giants such as Apple, Ericsson, Intel, Huawei, Microsoft, Qualcomm, and Sony involved in developing VVC, we have found it impossible to envisage how the MC-IF could avoid another bloodbath between Access Advance, MPEG LA, and Velos Media.

Having two separate VVC patent pools already signals a failure of this MC-IF mission, so who’s to say it will bother trying to prevent a third? Many moons ago, we said the MC-IF should be more concerned with promoting VVC against royalty-free codecs like AV1 and the more efficient AV2 further down the line, rather than trying to play peacemaker.

Before we get too sidetracked with codec politics, which is easily done, let’s address the news. MPEG LA’s VVC license terms are similar to its HEVC terms – both free for products shipping up to 100,000 units a year, then charged at $0.20 per unit thereafter.

The big key difference is the inclusion of the VVC Free Software tier, meaning use of VVC in free software, such as browsers, which is royalty-free up to 1 million units and charged at $0.05 per unit thereafter.

So, as Streaming Media’s Jan Ozer handily pointed out, this potentially means that if a giant like Apple paid $30 million in iPhone and iPad VVC hardware royalties, it would not be charged royalties for VVC software decode in Safari.

This is because MPEG LA’s VVC Product license is capped at $30 million, compared to a $25 million cap for the HEVC license.

On the other hand, the VVC Advance Pool license structure from Access Advance (formerly known as HEVC Advance) has set royalty rates and caps at a 25% increase over the HEVC Advance License structure – a hike which we fully expected.

Access Advance’s VVC licensing structure is a little more complex than MPEG LA’s, despite promising simplicity, as royalty rates are based on four device categories – mobile devices (including laptops), connected home devices (covering everything from set tops to security cameras), 4K UHD TVs (including projectors and VR headsets), and digital media storage devices (such as Blu-ray discs).

Region 1 lists 60 countries across Europe, North America, Middle East, and Asia Pacific. Rather inconveniently, Access Advance’s Region 2 list simply states “any country not listed for region 1” – so that’s all of Latin America, Africa, and some notable missing giants like China and Russia.

So, what about Sisvel and Velos Media, the two other patent pool administrators that have played a hand in the codec patent chaos? Velos Media is the third HEVC patent pool which has signed up heavyweights including Ericsson, Sony, Sharp, Panasonic, BlackBerry, and Technicolor – all of which are absent from the two current VVC patent pools.

Qualcomm was contributing its HEVC patents to Velos Media, before bizarrely ending its participation in the licensing platform in September 2021. This came completely out of the blue from Qualcomm, saying it is “exploring options for the future.”

With some of these involved in VVC development, as we mentioned earlier, they are likely to hold some essential patents and already be down the line with Velos Media in creating a third disparate VVC licensing structure.

Sisvel, meanwhile, is better known for throwing a spanner in the works of AV1, which famously was supposed to be royalty-free, but we wouldn’t completely rule it out of chasing VVC patents.

Another confusing but important aspect of the Access Advance licensing structure is the inclusion of something called the Multi-Codec Bridging Agreement (MCBA). This is not a separate license, but a contract allowing licensees to pay a reduced royalty rate when taking both HEVC and VVC patents from Access Advance’s two pools. For products that include both VVC and HEVC, licensees pay the same royalty rate as they would pay for a product that includes only VVC, providing an effective 45% discount.

However, unlike MPEG LA’s VVC licensing terms, there is no mention in the VVC Advance Pool about any royalty-free allowance up to a certain number of units shipped per year.

For Access Advance, the launch of the VVC Advance Patent Pool and the MCBA was done strategically to quickly consolidate a critical mass of the VVC patent landscape. The group believes that such consolidation will provide greater licensing certainty to the entire marketplace, while accelerating both VVC and HEVC adoption.

Looking at the two VVC patent licensor lists side by side, Access Advance’s significantly outweighs MPEG LA’s – by 27 to 11. However, in this house of codec cards, it is not the volume of patents that wins you any prizes, but the essentiality of these patents. More VVC patent holders will emerge out of the woodwork in time, choosing either to join MPEG LA’s pool, Access Advance’s pool, or a third pool likely formed by Velos Media.

Juggling three licensing structures will stall early experiments in VVC software-only decoding, in turn stalling the first iterations of hardware decoders. Three years is the general rule of thumb between a codec arriving in flagship devices and becoming a standard part of the entire family, right down to the budget SoCs.

We have included the full list of VVC licensors below:

b<>com, BBC, Digital Insights, FG Innovation, Hanwha Techwin, KPN, NHK, Orange, Siemens, Tagivan, and Vidyo.

Access Advance VVC Licensor list:

Alibaba, Arris (CommScope), B1 Institute of Image Technology, Dolby Laboratories, Electronics and Telecommunications Research Institute, GE Video Compression (a division of General Electric), Godo Kaisha IP Bridge, HFI Innovation (an affiliate of MediaTek), IdeaHub, Intellectual Discovery, JVCKenwood, KDDI, Philips, Korea Advanced Institute of Science & Technology, KBS, Kuaishou Technology, Mitsubishi, OP, Panasonic, SK Telecom, Toshiba, XRIS, as well as five South Korean universities – Sejong University, Hanyang University, Kwangwoon University, SKKU, and Kyung Hee University.

Apple, Ericsson, Intel, Huawei, Microsoft, Qualcomm, and Sony.

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