The DivX code is based on the MPEG-4 video standard, a successor to the technology that gave the world the popular MP3 audio format. The company says its technology can transfer a feature film over a high-speed connection in about 30 minutes.
Germany-based Fraunhofer, one of the companies behind the MP3 format, said it will use DivXNetworks' technology in its research projects to stream interactive 3D images in real time. Projects include letting people communicate in 3D during Web teleconferences and letting students watch a professor's lecture and interact in a 3D version of the classroom.
The licensing deal is part of DivXNetworks' aggressive efforts to move past its bootleg history and provide a compression format for services such as legal downloads and video-on-demand.
Last week, DivXits technology to The Jim Henson Co., known for the popular Muppets characters. In November, DivX began with Broadway Television Network, which produces and distributes digital recordings of Broadway musicals, to launch a video-on-demand service.
Although San Diego, Calif.-based DivX has been lining up significant partners, its format is not the only option for video compression. The company faces stifffrom major players, such as Microsoft and RealNetworks, which have dominated video technology.
"RealNetworks, Microsoft and QuickTime are still the preferred video codec for content providers," said Billy Pidgeon, analyst at Jupiter Media Metrix. "We really don't see that changing soon."
With the Fraunhofer deal, DivX is aiming to leapfrog such powerful rivals by focusing on next-generation applications.
Fraunhofer "only works on future applications," said Jordan Greenhall, chief executive of DivXNetworks. They've projected out five to 10 years of what technology will be capable of doing and develop in that direction. So that gave us an opportunity...to develop applications that are extremely exciting and very powerful for the next decade."