

US Department of Justice investigating MPEG LA - russell_h
http://online.wsj.com/article/SB10001424052748703752404576178833590548792.html#

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mustpax
_But the group says it isn't acting to kill a competitor. It said it's simply
offering a service for patent holders and is agnostic about which video format
prevails. "We are effectively a convenience store" for licensing patents, said
Larry Horn, MPEG LA's chief executive. "We have no dog in that fight."_

So, MPEG LA has no interest in extracting maximum possible amount of royalties
for its patent holders?

~~~
imbriaco
If you keep reading, it's clear that MPEG-LA believes it has patents in the
portfolio that cover VP8. If they expect to extract licensing revenue from
those patents it's altogether possible that they don't care which format
ultimately wins.

~~~
iujyhfgtrtgyhju
The MPEG-LA doesn't charge royalties to it's members. The members also all
hold patents - it's just an agreement not to sue each other.

They do charge royalties to anyone not in the association - those royalties
can of course be >100%.

In the old days we used to call this a cartel - but that's illegal.

~~~
Anechoic
_The MPEG-LA doesn't charge royalties to it's members_

Is that true? I though members had to pay royalties even if they had a patent
in the pool.

~~~
iujyhfgtrtgyhju
It's a complex and secret process - but MSFT and Apple are not paying $10 for
each copy of windows/iOS that includes an H264 player!

~~~
kenjackson
There's a royalty cap. I believe MSFT is paying the maximum royalty cap for
H264. And Apple only has one patent in the patent pool of 1000+ patents.

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kinofcain
Instead of the government investigating the MPEG LA for anti-trust violations,
how about they spend some time fixing the patent system. This whole h.264/VP8
brouhaha is a symptom, not the disease.

~~~
lallysingh
Let's remember that different actors in the government have their own
motivations. Investigating the MPEG LA is a DOJ issue. The DOJ's full of long-
term government employees who are motivated by their own career metrics.

Fixing the patent system will require legislation, which is a function of our
elected officials. These officials, really (and tragically) by necessity at
this point, are driven by funding their re-election campaign.

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ChuckMcM
MPEG LA exists to extract patent royalties. By patent terms they are a
'legitimate' monopoly as the patent system was created to allow an inventor a
temporary monopoly over their technology (20 yrs) on the condition that it
passes to the public domain after that.

Given the early MPEG patents are in the mid - 90s they will begin to start
expiring in 2015. Once we reach 2021 there will be a dozen free codecs with
source code on the market.

In the meantime, MPEG LA does what it can to maximize its revenues.

~~~
danbmil99
While patents do confer a form of monopoly protection to an inventor and their
assignees, that does not give anyone the right to form a cartel of multiple
patent holders who work in concert to fix the price for the combined product.

MPEG-LA's workaround for that, which is what is at stake here, is some sort of
carve-out with the FTC, stipulating that because it's an emerging standard,
MPEG should not be subject to the normal restrictions on patent pooling.

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Kylekramer
I'm pretty firmly on WebM's side in this whole patent flame war thing, but
getting the Justice Department looking into MPEG-LA already just makes me
think Google's got some damn good lobbyists in Washington. I never heard of
the government getting involved at this early stage of a patent battle before.

Of course, MPEG protection racket-esque comments in the article makes this a
bit easier to swallow.

~~~
VomisaCaasi
I guess even Google would be pissed if an investment of 125M was to be flushed
down the toilet. Also, I'm pretty sure they had far-reaching strategy right
from the beginning, and had prepared themselves for such issues that might
eventually leading them into battle.

~~~
danbmil99
It's a win/win for Google. The long game is this: either they win the fight
outright and webM becomes _the_ video standard, or they use webM and the
specter of long, drawn-out (and expensive) litigation to force MPEG-LA to
rethink their royalty policy.

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tomlin
"I can tell you: VP8 is not patent-free," Mr. Horn said. "It's simply
nonsense."

These statements are conscience injections, red herrings, and convenient sound
bites for zealots like Gruber to use in their "see I told you" agenda-driven
opinion pieces. Truth is, patents for a video codec to be used on the web is
_simply nonsense_. It's a stifle of creativity and hopefully we end up winning
with a free, open codec that can be used in open source software. This is the
formula that encourages innovation.

H.264 hardware inconveniences, gripes - to the wind.

~~~
fryguy
I think you gravely misunderstand the patent system. When you can get a patent
on drawing a line onto the screen
([http://www.google.com/patents/about?id=KYwhAAAAEBAJ&dq=r...](http://www.google.com/patents/about?id=KYwhAAAAEBAJ&dq=render+line+raster+display)),
it means that anything in your codec _might_ be patented by some ridiculous
patent already.

~~~
chc
So _might_ your own proprietary software. And the Pope _might_ be an axe
murderer. A very large number of things _might_ be true. Singling out this
software as particularly hazardous because of _might_ s smacks of FUD.

~~~
kronusaturn
If you walk across a minefield, you _might_ step on a mine. Singling out
minefields as particularly hazardous because of _mights_ smacks of FUD.

Joking aside, this is a false dilemma. Patent trolls actually exist,
inadvertent patent infringement is not some purely hypothetical risk.
Particularly in fields like video codecs where the mines are laid especially
thick.

~~~
chc
If you walk across a minefield, you are walking into a place where there are
proven to be mines in your likely path. That's a much more present danger than
the mere possibility of a mine's existence. A minefield _verifiably_ has
mines, not just _might_ have mines, and thus walking in an arbitrary path
there has a measurable chance of blowing you up (and there might be some
specific paths with a 0% chance of blowing you up, which are also different
from the minefield in general).

In spite of this supposed huge vulnerability, nobody has ever suggested even
one single patent that could potentially be read as covering anything in
Google's WebM tech, much less the "minefield" that MPEG-LA try to conjure up
with their vague insinuations. You'd be about as well-supported by the
evidence if you claimed that God just hates WebM and will smite down anyone
who uses it to encode video.

I'm not saying that WebM _isn't_ on a patent minefield. I can't prove that
negative claim. But I can say that I've never seen anyone offer any credible
evidence for this minefield.

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rbarooah
Is there a reason that Google isn't offering patent indemnification other than
that they aren't sure WebM is patent free either?

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nlogn
Is there a reason that MPEG-LA isn't offering patent indemnification other
than they aren't sure H.264 is patent free either?

<http://news.ycombinator.net/item?id=2100601>

This argument is total FUD.

~~~
rbarooah
Google claims WebM is patent free.

MPEG-LA doesn't claim H.264 is patent free - they just offer a simplified way
to license a large number of patents.

If it is FUD, perhaps you can offer an explanation rather than just
deflection.

~~~
tomlin
WebM - free license, no guarantees of indemnification

H.264 - paid license, no guarantees of indemnification

Any argument that circumvents the above fact is _agenda-driven_. People know
that WebM is the better choice; but are instead trying to find a roundabout
way of keeping their H.264 encoders relevant.

~~~
rbarooah
Simply untrue. Presented in those terms, the 'fact' is:

WebM - free license, indemnification against 0 patents.

H.264 - paid license, indemnification against > 1700 patents.

(here's the list: [http://www.mpegla.com/main/programs/avc/Documents/avc-
att1.p...](http://www.mpegla.com/main/programs/avc/Documents/avc-att1.pdf))

For WebM to be a free equivalent, Google would have to indemnify users against
_that list_ of patents. If Google is sure that the patents are not infringed,
why doesn't it at least do that?

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alexkcd
WebM is an inferior codec to h264. As much as I'd like a patent-free
alternative, it's unlikely that consumers will be willing to take a step back
in video compression/quality. The fact of the matter is that large companies
can afford to pay royalties, and end users don't have to. There's very little
incentive to move to something new, let alone inferior in quality and of
dubious future.

Now imagine a patent-free codec came along that had substantially better
quality per bit-rate and was at least as efficient as h264. You wouldn't need
lobbying to move us over. The pirates would embrace it first, and everyone
else would follow. At the end of the day, moving forward is the only way we
know. Sadly, WebM is leading in the opposite direction.

~~~
ZeroGravitas
All your arguments below, about WebM not being supported and hardware
accelerated on every device, apply equally to your hypothetical better than
H.264 codec. So it's a bit simplistic to say only quality matters, and
Google's has created more hardware (and software) support for WebM than I
thought possible.

It's likely that getting that support was aided by being clearly patent-free
so certain compression techniques and wide support are probably linked.

Of course, a better than H.264 codec isn't hypothetical. THere is H.265 and
VP9 coming, neither of which has hardware support or patent royalty demands or
wide usage by pirates. The level of support for VP8 is likely to influence how
those things pan out in the future.

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alexkcd
Yes all my arguments apply to my hypothetical codec. Where did I imply
otherwise?

If you want your codec to be adopted despite lack of hardware/software
support, you really need to offer something worth the hassle. Notably reduced
buffering wait times for consumers, and lower bandwidth costs and ease of
distribution (encoder/decoder) for pirates would be such needs worth the
hassle. WebM is worse in all these cases. Very few people care about
royalties, so it's simply not enough to ask everyone to swap out all the
hardware and other infrastructure for mostly ideological fluff.

You actually need to make a better codec. And so far there is nothing out
there (H265 and VP9 don't have a usable encoder/decoder).

~~~
ZeroGravitas
My point was that Google _is_ providing the software and hardware support[1],
in conjunction with every big name you could mention, with a short list of
notable exceptions, therefore overall it is as strong as another hypothetical
royalty-free codec which is technically better, but which has less hardware,
software or industry support.

In short "better" codec means more than just compression efficiency and asking
people to switch out their infrastructure for a quality improvement is as
tough as for a cost reduction. It only happens now because the whole industry
acts in concert to make it happen. There's no reason why the industry couldn't
coalesce around a free codec next time if the "idealogues" and "hippies" have
laid sufficient groundwork, either with no business case or one that only
works in certain niches. This is how it has worked in many other free software
or free content success story.

[1] this doesn't seem to be widely known. If you google for WebM then one of
the twitter results is Joe Hewitt asking smugly when Google will announce
hardware and Youtube support for WebM, something they'd done about a year
previously.

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wtn
This is hilarious! If patent enforcement is an illegal anticompetitive action,
then the patent system itself is a contradiction.

~~~
marshray
Yeah really.

This looks to me like the patent system operating as designed.

I guess if you're Google you can get the government to make an exception for
you in the interest of fairness.

But it's cold legalistic capitalism for the rest of us.

~~~
runevault
As someone else pointed out, the one thing that makes this interesting is,
instead of bothering to do the legal legwork first to PROVE they cover vp8,
they simply make vague threats to scare people out of using it, which I highly
doubt is how the patent system was meant to be used.

~~~
kenjackson
Are vague threats illegal? Do legal threats have to be specific? It seems like
one of the most common threats I know of is, "I'm going to sue you!" It's
usually not a specific, "I'm going to sue you based on violation of XYZ". It's
usually a very vague statement. Is that generally illegal, but just not
enforced?

~~~
marshray
_Are vague threats illegal? Do legal threats have to be specific?_

Not in general, if they're vague enough.

But when they come from the lawyer pool of a massively-funded cartel sitting
on 1700 patents, they're inherently credible threats.

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amitraman1
Video formats should be open and free to use/redistribute. Otherwise, startups
can't get off the ground quickly (YouTube being the exception).

Charge for encryption/licensing formats.

