“The problem with HEVC is that you don’t know what you will have to pay,” says Martin Smole, Engineering Director Encoding, Bitmovin. To make matters more complex, there are multiple other HEVC IP owners (such as Nokia and Technicolor) who have not yet joined a pool or announced a royalty policy. The third major pool, Velos Media, has not yet declared its royalty rate. This ‘tax’ on distribution hits streamers like YouTube and Netflix and can be charged on a title by title basis. While MPEG LA only charges per decoding units capped at U$25m a year, HEVC Advance caps its annual unit charge at U$40m and demands royalties for streaming, capped at U$5m a year. Licences are required from three main licence pools MPEG LA, HEVC Advance, and Velos Media - which represents the interests of Ericsson, Panasonic, Qualcomm, Sharp, and Sony.
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The code for the codec is on the point of being frozen and encoding vendors are poised to release the product based on it at NAB next month. That alternative, called AV1, has now arrived and it is claimed to be up to 30% more efficient than HEVC. In particular, HEVC adoption has been low for use in streaming and is why some of the largest tech companies - Amazon, Netflix, Google, Intel, Cisco, Microsoft, Nvidia and AMD among them - formed the Alliance for Open Media with the aim to create a royalty-free alternative. The joint patent holders of the technology have demanded licence fees which many in the industry consider either too high or too vague to justify investment. However, HEVC has not taken off in the same way previous standards have because MPEG was not alone in its development. MPEG-4 cut the bandwidth needed to deliver programming by half, and its successor H.265/HEVC (High Efficiency Video Coding) published in 2013 managed the same 50% saving trick again.
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MPEG-2 was the de-facto format of digital TV signals before MPEG delivered a more efficient scheme, MPEG-4/ H.264 AVC, in 2004. Video compression has been dominated for as long as anyone can remember by standards bodies Motion Picture Experts Group (MPEG) and ISO/IEC.
That’s changing as the current market leader, HEVC, is challenged by a new generation of codecs potentially capable of delivering improved video playback at greater efficiency and crucially, at lower cost.
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