The video compression patent licensing market will be transformed by Access Advance’s planned acquisition of the Via LA HEVC/VVC program. Time will tell if the consolidation of core technologies by Google, Apple, Microsoft and others under one administrator will be enough to dampen interest in AV1 — the royalty-free codec option gaining traction with major streaming platforms and chipmakers.
Access Advance, administrator of the HEVC Advance patent pool, on Monday announced it will assume administrative duties for Via Licensing Alliance’s high efficiency video coding (HEVC)/Versatile Video Coding (VVC) program.The acquisition — in the works since this summer — represents an effort to “simplify the video licensing landscape and provide greater clarity and efficiency for licensors and licensees worldwide,” according to a joint press release by the companies.
In an interview with MLex, Access Advance CEO Peter Moller said market demand for a one-stop shop motivated the maneuver he describes as a “win-win.”
“By consolidating patent administration of the two pools under Access Advance, we believe it will be far more streamlined, far more efficient, and we'll have a better chance of creating a single pool — which is ultimately our goal,” he added.
— Early-stage alignment —
The HEVC Advance pool counts Sharp and Google among its 46 licensors while the Via LA joint HEVC/VVC program features innovations by Siemens, Maxell and over a dozen others, according to Via LA’s website.
The fragmentation of such key IP has been lamented by implementors of the HEVC standard, and its successor VVC standard, in need of access to a broad swathe of video compression technologies to make products and offer services free from the threat of litigation.
But it has also presented logistical challenges in the form of duplicated governance and conflicts in strategy for standard essential patent (SEP) owners like Fujitsu and Dolby, who maintain a presence in both pools.
Adding to that complexity is the practical reality that a subset of HEVC and VVC licensors are licensees, themselves. That is the case for entities like Microsoft, who fills both roles for HEVC Access, and Canon, a dual licensor-licensee in Via LA’s HEVC/VVC pool.
The decision to consolidate administration comes in the midst of increased competition from AV1 — a royalty-free video codec by the tech consortium Alliance for Open Media.
While streaming services like Netflix and Vimeo still rely on HEVC as a fallback for legacy devices and broadcast workflows, they have increasingly turned to AV1 — and not VVC — for production delivery. The same can be said for device manufacturers like Sony and Samsung, and chipmakers like Qualcomm and NVIDIA.
The establishment of a unified VVC royalty before adoption reaches mass scale thus holds obvious appeal for SEP licensors and even licensees, but the Access Advance CEO said he sees an upside for consumers as well.
That is because the myriad benefits of the approach being considered — with Moller singling out lower effective royalties and a lessened administrative burden, among others — might not only stem the AV1 tide but also speed the adoption of codecs yet to come.
“You won't have fragmentation in the early stages,” he explained. “You'll have alignment.”
— No rate change —
Consolidation will require the blessing of licensors and licensees from both pools — something that is expected to take 6-12 months to achieve. Moller vowed, however, that if even a single party chooses to maintain the status quo his company remains committed to administering the Via LC pool and honoring its terms.
“As long as you're a licensee and you remain a licensee, you have a right to continue to be licensed,” he told MLex.
“We will continue as long as there are licensees that believe that the Via LA license is an asset that they want to maintain. Hopefully, over time, we'll be able to combine the two so that the vast majority of licensees and licensors are only dealing with one administrator and one pool,” Moller added.
Additionally, he made clear that parties to the Access Advance Multi-Codec Bridging Agreement (MCBA) — which offers a discounted royalty rate for products implementing both HEVC and VVC codecs — will continue to realize those savings.
“Our rates aren't going to change. From a licensee perspective, you're getting more value. You're getting greater efficiency. All the benefits you would have when you're dealing with a single entity,” he added.
— Pro-competitive —
That same narrowing of options is one of the hallmarks of antitrust scrutiny, but because implementers still have the ability to negotiate bilaterally with SEP holders their choices aren’t so limited.
Moller, for his part, said he harbors no concern that Access Advance’s acquisition of Via LA’s HEVC/VVC pool could trigger regulatory review, proclaiming the deal “good for the entire marketplace.”
“The combination of our two [pools] is going to reduce prices, reduce fragmentation, increase efficiency, reduce costs to become licensed and facilitate adoption. You can't find any negative, in my mind, when you look at the pro-competitive effects of this transaction,” he added.
News of the consolidation did result in a shakeup of the executive team at Via LA, whose president, Heath Hoglund, announced on LinkedIn that he is departing the company. Kevin Mack — most recently Vice President of IP & Legal Strategy at Dolby Laboratories — was tapped to take over in his place, effective immediately, Via LA said in a press release.
“Kevin’s appointment as President of Via reflects our continued focus on organizational strength and long-term strategy. Via remains committed to supporting partners and advancing our broader technology licensing mission,” Andy Sherman, Chairman of the Board of Directors of Via, said. “We are grateful for Heath’s leadership and contributions he has made over many years.
The divestiture of its HEVC/VVC pool comes on the heels of Via LA’s revelation this fall (see here) that it is taking steps to enter the semiconductor patent licensing market, with initial plans to launch a pool focused on memory.
Mack’s experience is widely expected to give those efforts a boost.
Via LA’s existing offerings relating to the Advanced Audio Coding (AAC), Qi wireless charging and ATSC 3.0 broadcast and television standards are unaffected by Monday’s announcement.
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