Codec patent wars are coming for streaming economics
The article argues that standard essential patent (SEP) disputes around video compression standards such as H.264, HEVC, and VVC are increasingly becoming a global litigation focus, similar to earlier smartphone patent wars. It highlights a more fragmented licensing environment (multiple patent pools and independent licensors) and notes evolving US policy signals from the DOJ and USPTO that support stronger SEP enforcement alongside antitrust considerations. The piece emphasizes the need for economically grounded FRAND valuation methods, including comparable licenses and top-down royalty analyses, to resolve disputes as streaming and cloud usage grow.
Key Takeaways
- Video codec SEPs are emerging as a primary multi-jurisdiction litigation battleground as streaming, cloud, and AI video usage grows.
- Licensing is fragmenting: newer codecs increasingly involve multiple patent pools plus independent licensors, complicating royalty stacking and deal certainty.
- U.S. policy signals from DOJ and USPTO suggest a more “balanced” stance where injunctions and strong enforcement can coexist with competition concerns.
- FRAND valuation rigor is becoming a core capability: comparable licenses and top-down royalty frameworks are positioned as key dispute-resolution tools.
Why It Matters
Streaming’s next margin shock may not be CDN pricing or ad load—it may be codec royalties and courtroom calendars. Codecs sit inside everything (apps, TVs, browsers, cloud transcodes), so SEP disputes can quickly become cross-border leverage that impacts product roadmaps, cost of goods, and even market access. Fragmented pools + independent licensors increase the risk of royalty stacking and unpredictable terms, especially as VVC adoption decisions get made. The emerging meme: “smartphone patent wars, but for pixels”—and the winners will be the teams that model FRAND economics early and negotiate from data, not hope.
Read full article at cornerstone.com
Enjoy our coverage?
Add StreamingMeme as a preferred source on Google to see more of our streaming news at the top of your Search results.
Add as preferred source