Patent group to lower barrier for sharper next-gen video

Facing resistance from streaming-media companies, an industry group agrees to lower patent licensing fees that stand in the way of the shift to "4K" high-resolution video.

The Amazon Fire TV can pull in Internet video compressed with HEVC/H.265 technology, but Amazon is also backing development of a competing technology. Nate Ralph/CNET

A hurdle standing in the way of streaming high-quality video to your TV and devices just got a little bit lower.

That's because an industry group called HEVC Advance that was seeking to profit from the shift to high-resolution video technology was forced to back down on patent licensing fee demands. Online video companies resisted HEVC Advance's demand for 0.5 percent of revenue from streaming video using its technology, called HEVC/H.265.

"We have received significant market feedback, particularly on content fees, and will adjust fees to support widespread use of HEVC," Pete Moller, chief executive of HEVC Advance, said Wednesday in a statement. Lower fees ultimately mean lower operating costs for streaming-video companies potentially making it cheaper for consumers to buy premium high-resolution video.

Data compression technology -- HEVC/H.265 is the leading contender -- is essential for streaming sharp, crisp video onto your television or tablet. But patent fee problems have delayed some major players' support for HEVC/H.265. Lower fees should help speed up that adoption.

This is critical as consumers increasingly get their video over the Internet instead of through cable TV subscriptions or optical media like DVDs and Blu-ray discs. Broadband often struggles to keep up with high-resolution video, and the problem is getting worse with the arrival of even higher quality video. This video, called 4K or Ultra HD, has at least four times the pixels as mainstream 1,920x1,080 video. HEVC/H.265 can compress 4K video better than previous technologies so network connections can keep up.

It's not yet clear just how much HEVC Advance will adjust its rates, but it is clear that the group underestimated the growing power of the streaming-video services. They're no longer entertainment industry lightweights as consumers flock to services from Netflix, Amazon, Vimeo, YouTube and Hulu and from traditional networks like HBO.

Those companies are better able to present a unified front, too, through technical cooperation and groups like the Streaming Video Alliance, a consortium including technology companies like Intel and media companies like Fox Networks. They also have big technology allies, notably Google, Microsoft, Cisco, Intel and Mozilla, which in response to HEVC licensing barriers pooled efforts to create an alternative called the Alliance for Open Media.

Today's dominant video compression technology, called AVC or H.264, is widely used by everything from smartphone cameras to Web browsers. It looked like HEVC/H.265 would be the heir to the throne, until licensing concerns arrived in late 2014.

A group called MPEG LA, with years of experience licensing patents for video compression, offered a single license that granted rights to use HEVC/H.265. It raised the maximum annual royalty from $5 million for H.264 to $25 million for H.265 for companies shipping the compression technology in products. But it charged nothing for HEVC/H.265 streaming video.

Then in March, HEVC Advance burst onto the scene with a second patent pool for the compression technology. Initial backers include General Electric, Technicolor, Dolby, Philips and Mitsubishi Electric. Dan Rayburn, an analyst with Frost & Sullivan, expects a third to arrive, too, since some patent holders like Sony aren't members of the first two groups.

The uncertainty has boosted Google's VP9 and VP10 compression and ultimately led the tech giant to contribute that technology to the broader effort.

It may not be possible to bypass HEVC and its patent royalties, though. For one thing, the Open Media Alliance's technology won't arrive until 2016 or 2017. For another, there's still a lot of HEVC momentum. Amazon's new Fire TV includes HEVC , even though Amazon is a member of the Alliance for Open Media. And that compression technology might well step on patented innovations in HEVC, media patent experts from investment bank Black Stone IP said in an interview with StreamingMedia.com.

Last, HEVC Advance also said on Wednesday it signed up a significant new member: Chinese mobile phone chipmaker MediaTek. It might not have had as much power as it thought, but it's still got some.

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