Patent issues could delay new video codec

June 26, 2012 // By Rick Merritt
The H.265 High Efficiency Video Coding (HEVC) standard is about to be ratified, promising a new generation of higher resolution and more compact digital video products. The bad news is chip makers are afraid to design products using it.
Vendors may have filed as many as 500 patents relating to the H.265 HEVC technology. But so far just who owns what and how much they expect in royalties is unclear.

The current video codec, H.264, has been the basis of digital video products such as cameraphones and digital video recorders for eight years. Thanks to a patent pool created by the MPEG Licensing Authority , the royalty rate was a flat 25 cents per chip, capped at about $12 million per vendor.

“That’s 40 million chips, but for cellphone chip vendors, that’s not much volume,” said an executive at one chip company who asked to remain anonymous.

The MPEG LA claims it is working on a follow on. “We plan to begin facilitation of an H.265 patent pool this summer,” said an MPEG LA spokesman.

But chip vendors say the group is having trouble getting support for the new pool. The new standard has many new patent holders not involved in the prior pool including Mediatek, Qualcomm and Samsung who do not want to join the group but prefer collecting royalties on their own, said the semiconductor executive.

The scenario is already playing out in other areas. Via Licensing  recently said  it will have this fall a 20-company patent pool for Long Term Evolution, the dominant 4G cellular technology. However, big patent holders including Ericsson, Nokia and Qualcomm are said to not be participating in the pool.

Chip makers expect the H.265 HEVC standard could be ratified within two months. That would open the door for them to start taping out their chip designs—if the royalty situation is clear.

“HEVC has so many patent holders and some of them say they will not be part of the pool but want to collect royalties themselves,” said the chip exec. “If say 20 people all want to collect royalties it will kill the standard—we need a fixed cost, it