Microsoft, Google, Mozilla, Cisco, Intel, Netflix, and Amazon today launched a new consortium, the Alliance for Open Media. The group plans to develop next-generation media formats—including audio and still images, but with video as the top priority—and deliver them as royalty-free open source, suitable for both commercial and noncommercial content.

Further Reading New patent group threatens to derail 4K HEVC video streaming

The issue of patent licenses and royalties continues to plague the video industry. While H.264/AVC video had relatively cheap licensing, it looks as if its successor, H.265/HEVC, is going to be considerably more expensive . Organizations that derive significant income from patent royalties and IP licensing weren't happy with the low-cost model used for H.264, and so are pushing back. This is a great threat to open source and non-commercial streaming, which has no obvious way to pay the royalties. The HEVC royalty structure would even threaten the viability of commercial streamers such as Netflix.

The Alliance for Open Media would put an end to this problem. The group's first aim is to produce a video codec that's a meaningful improvement on HEVC. Many of the members already have their own work on next-generation codecs; Cisco has Thor, Mozilla has been working on Daala, and Google on VP9 and VP10. Daala and Thor are both also under consideration by the IETF's netvc working group, which is similarly trying to assemble a royalty-free video codec.

The companies that have founded the Alliance are, notably, companies that deliver software and services (or, in Intel's case, hardware to drive those software and services) rather than merely licensing intellectual property. They don't need the licensed royalty model that video codecs have tended to use in the past.

However, the desire to be royalty-free does not always translate cleanly into freedom from royalties. Microsoft intended for its VC-1 video codec, finalized in 2006, to use only patents held by Microsoft so that the company could offer it royalty-free. But this was not successful; some 18 companies now claim to have royalty-incurring patent claims on the spec.

Google bought On2 and released its VP8 codec, similarly claiming to be the sole patent holder. This too became murky; MPEG LA, which handles much of the patent licensing for H.264, announced that 12 companies had patents that covered parts of VP8. Google and MPEG LA came to an agreement in 2013 whereby Google obtained a license to these patents and had the right to sublicense them. This dodged the royalty bullet, but shows that there is a difficulty in developing effective video codecs without treading on others' toes.

We talked to Alliance representatives from Microsoft and Google about how they would avoid a recurrence of these issues in the future. They did not offer any concrete plans. While having seven member companies (and possibly more; the representatives told us that they had been talking to other interested companies) gives the Alliance a greater selection of technology and intellectual property to choose from, the risk of one or more non-member companies asserting that the spec infringes their patents is nonetheless real. Avoiding this should be a priority, so we were a little surprised not to hear any strategy to handle the problem.