I've recently written about Access Advance's High Efficiency Video Coding (HEVC, H.265) pool (one post discussing the logic of the recent Dusseldorf ruling against Access Advance, and another on how the problem appears to persist).
Today there's an announcement (PDF) by a more reputable pool administrator, MPEG LA, of a Versatile Video Coding (VVC, H.266) pool. So let's look at VVC, but start with Access Advance, which was first to announce its initial group of licensors.
On its homepage, Access Advance says about its VVC Advance Licensing Program that its terms are FRAND, "providing rates that balance both Licensor and Licensee interests and complying with worldwide laws applicable to patent pools." (emphasis added) The highlighted part of that quote is "rich." I mean, either they haven't read their own website in a while or they still haven't read the writing on the Dusseldorf court's wall.
The only patent pool administrator (to the best of my knowledge) to license patents (HEVC in that case) on terms that a court even thought entitled unlicensed implementers to damages is not in a great position to assist the rest of the world with FRAND compliance. It happened to them in a court in which MPEG LA had dozens of successes, and still has a clean white shirt when it comes to FRAND.
At this early stage, Access Advance's VVC pool (named VVC Advance) has support from 28 licensors (listed in a January 11, 2022 press release) vs. MPEG LA's initial 11 (b<>com; British Broadcasting Corporation; Digital Insights Inc.; FG Innovation Company Limited; Hanwha Techwin Co., Ltd.; Koninklijke KPN N.V.; Nippon Hoso Kyokai; Orange; Siemens Corp.; Tagivan II LLC; Vidyo, Inc.).
While IPlytics explained how hard it is to estimate the strength of VVC-essential portfolios at this stage, they nevertheless presented a slide last summer that listed 21 major VVC patent holders. Some of them are on Access Advance's list of licensors (Dolby, SK Telecom, Toshiba). But the other 18 out of the 21 listed by IPlytics are either companies who rarely join pools (like InterDigital) or, which is quite telling, they are in the HEVC Advance pool but not--or not yet--VVC Advance licensors, such as Samsung, Google, Microsoft, Huawei, Canon, and LG.
It would take only a few major VVC SEP holders who join MPEG LA's pool, and they'd take the lead. That's why it's too early to call the game. Access Advance is in a difficult position now, and can't explain away the Dusseldorf disaster. Maybe even some of its initial 28 licensors would have made a different decision if the Dusseldorf rulings in the Vestel cases had come down a month or two earlier (before the internal decisions on which pool to join were made).
Implementers will be concerned about the fragmented licensing landscape. There are now two pools, lots of undecided major portfolio owners, and I've heard from industry players that a third pool is being formed.
MPEG LA's AVC/H.264 pool was a huge success, and it made the AVC standard successful. With HEVC, things didn't work out, mostly due to patent licensing issues. What will happen to VVC? Will it ultimately be less popular than some alternatives? Will there be a lot of litigation (by Access Advance licensors more so than anybody else)? It's too early to tell.
One year ago, MPEG LA announced the development of a VVC pool license. Today, they reached the next milestone and listed the first 11 licensors, one of which (Digital Insights) is--quite interestingly--an HEVC Advance licensor.
While VVC Advance--by virtue of being early and not having to poach MPEG LA licensors--may be able to avoid some of Access Advance's HEVC-related FRAND problems, my concerns are still structural. The unfair refund terms are not the root cause of their problems. The fundamental issue is that Access Advance optimizes all of its terms for the purposes of its four owners, only one of which (Dolby) appears on IPlytics's list of 21 major VVC patent holders. If they operated their pools more independently and transparently, they could also have acted more constructively with respect to refunds. But the cut taken by Access Advance and those special deals with companies who are both licensors and major implementers (like Samsung) complicated everything. In some other way, shape or form, that root cause may lead to problems--if not for Access Advance, then at least for the standard in question.
It's a rhetorical question which of these two patent pool administrators has always understood (and which one still doesn't seem to realize) that if licensing terms are reasonable, a standard is more likely to be adopted by many implementers, which in turn makes the licensing revenue cake bigger for patentees than a scenario of high fees and low adoption.
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