AVC/H.264 licencing answered.

farss wrote on 2/9/2010, 8:25 AM
Seeing as how this was a topic some time ago I had emailed MPEGLA and they called me, at 2AM down here so I'm still half asleep and can't be bothered finding the original thread.

In general and despite the way the licence that comes with every NLE is worded we are covered even if we make money from using the encoder. Specific case I asked about was if we are paid to shoot an event or corporate video which we encode to H.264 and then sell to our customer or charge a fee for service. In this case our customer(s) are considered subscribers and you only need pay a licence fee if you have over 100,000 subscribers which as the man said is very unlikely.
Services that have subscribers that do not pay a fee also do not require a licence so Youtube and Hulu do not have a to pay a fee as they don't charge to view.
The same applies to using your AVCHD camera, you can do what you want with the video you shoot on it.
What the licence doesn't let you do is use say your camera as a direct to subscriber encoder. You also cannot take the encoder chip out of it and use it that way.

Licence fees when they are payable are very reasonable at $2 per encoder or decoder device and $0.02 per disk.

I hope this puts everyones mind at ease. It is not a legal opinion. If you want further clarification or have additional concerns contact MPEGLA. The gent who called was very keen to help even if he didn't realise he was calling the other side of the world in the wee hours of the morning.
Oh and I hear LA is expecting another two feet of snow :)

Bob.

Comments

Byron K wrote on 2/9/2010, 10:21 AM
I found this very interesting, thanks for posting!
Coursedesign wrote on 2/10/2010, 12:36 PM
Bob,

Thanks!
John_Cline wrote on 2/10/2010, 2:30 PM
Good to know. Thanks.
Jay Gladwell wrote on 2/10/2010, 2:33 PM

Bravo, Bob!

bigrock wrote on 2/10/2010, 3:01 PM
The issue is not so cut anddry if you are going to broadcast on the internet. Those terms are quite different and subject to change from what I understand.
farss wrote on 2/10/2010, 3:19 PM
These were issues that I specifcally raised.
Unless you have over 100,000 subscribers who are paying then you do not need an additional licence. This means Youtube (specifically given as a case in point by the man from MEPGLA) do not need a licence.

If you were to encode something for a client who does meet the requirements to hold an additional licence then it is he who must obtain the licence. I guess we should make that clear to our clients if they're likely to fall into that category which I doubt.

Another case in point was a large corporation encoding video for viewing over their intranet. No additional licence needed.


From what was said the meaning of the words "private" and "commercial" are not being used in the way I would have taken them. I'd certainly suggest MPEGLA or someone needs to clarify this in plain English. It's perfectly reasonable to see why I and many others got completely the wrong idea from reading the terms of the licence.

Please, no one take what I'm saying as gospel. It costs nothing to contact MPEGLA. They will respond, they are very keen to help, the man I spoke to was very pleased that I had contacted him. The more people who ask questions the more likely they are to realise they have an issue that needs clarification. If enough people contact them no doubt they'll add to their FAQ page.

Bob.
bigrock wrote on 2/12/2010, 11:41 AM
Suggest you read this article: http://www.streamingmedia.com/article.asp?id=10900

The basic problem is the present license terms apparently expire at the end of 2010 and we don't know what will happen then. Some of the exemptions that allow free use now may disappear. Internet broadcast was specificially exempted during the first term of the contract which says "that the royalty for Internet Broadcast AVC Use following the first term shall be no more than the economic equivalent of royalties payable at that time for free television during the same time".

The first term ends at the end of 2010 so advice they give now has a short expiry date it would seem for internet broadcast. The licensee could impose a cost to Internet broadcast next year if they wish. Pretty hard to plan anything with those kinds of terms for me anyways. Work deployed might have to be reencoded to something else if you don't like the terms. Google has been in the process of buying ON2 to get the VP6 codec which is just as good for internet broadcast, are they preparing for something, one has to wonder.

I would still use H.264 if you want but keep an eye on things and keep your masters safe in case you need to reencode. If you are doing Flash Video using VP6 produces a result that is pretty much the same with no licensing issues.

Has anybody heard what MPEGLA's plans for Internet Broadcast for the second 5 year term of the license that starts in 2011? Might a question you might want to ask that guy.
farss wrote on 2/12/2010, 1:40 PM
"Has anybody heard what MPEGLA's plans for Internet Broadcast for the second 5 year term of the license that starts in 2011?"

Heard nothing and at the time I spoke to MPEGLA I didn't even know it was an issue.


"Might a question you might want to ask that guy."

Far better for you to call them. Im on the other side of the planet and loosing one nights sleep for the cause is a pretty reasonable contribution to the cause by myself.

You know your business model way better than me and would be far better able to explain your concerns than me. The more 2nd tier producers who call the better. Seems to me the 2nd tier always get shafted in these kinds of deals and arguably because they fail to make themselves heard.

Bob.
Steve Crouch wrote on 2/12/2010, 5:43 PM
MPEGLA have already announced that they will be extending the term for which there will be no licence charge for internet video where there is no charge to the end user.

See http://www.mpegla.com/Lists/MPEG%20LA%20News%20List/Attachments/226/n-10-02-02.pdf