[M4IF Discuss] RE: [OpenDTV] News: Terms of MPEG-4 Visual Patent Portfolio License Announced

[Jordan Greenhall]

All,
As I read it, the use fee is based on actual hours watched, not hours
broadcasted.  Thus, the formula below would be modified:
[Hours Watched / Subscriber / Month] X [total subscribers] * [$0.02] =
usage fees.  Then something like Nielsons would be used as a surrogate
to determine hours watched by a subscriber.  
This is a (very little) bit more reasonable, as a stream of seinfeld
would cost more than a stream of a brady bunch rerun.  But, even then,
it is commercially unreasonable.  Take a look:
1. DVD with 120 minute movie.  Revenue: $25.  MPEG-4 license fee: $0.04.
Fee as % of Revenue: .16%
2. A broadcast of that exact same movie with commercials.  Revenue: $1
(48 30 second commercials at a $25 CPM).  MPEG-4 license fee.  $0.04.
Fee as % of Revenue: 4%
The cost of the MPEG-4 license scales with views, not revenue generated
by views.  This is like the bandwidth problem that has killed streaming
media on the Internet.  
There are other odd effects as well.
J
-----Original Message-----
From: Rob Koenen [mailto:rkoenen   intertrust.com] 
Sent: Monday, February 04, 2024 12:52 PM
To: 'craig   pcube.com'; jmcclenny   sandstream.com; OpenDTV Mail List; M4IF
Discussion List (E-mail)
Subject: [M4IF Discuss] RE: [OpenDTV] News: Terms of MPEG-4 Visual
Patent Portfolio License Announced
> The fee would be prohibitively expensive  IF calculated based on: 
> [Channels]  X  [programming hours]  X  [total subscribers]  X 
> [$0.02/hr] = usage fees

While not passing any judgement on the announced scheme at this moment,
the press release makes it somewhat clear that this is not the way
things will be calculated. 
"[... a surrogate (e.g., standard industry audience measurement) is 
  under consideration."
http://www.mpegla.com/news_release31Jan2002.html
But this is far from conclusive; what exactly the calculation *will*
look like is unclear - and MPEG-4's future depends on it.
It should also be noted that (AS FAR AS I UNDERSTAND IT) you pay
*either* 
the encoder/decoder fee *or* the use fee, not both. You pay a use fee
for use of MPEG-4 "[...] in connection with which a service provider or
content 
  owner receives remuneration as a result of offering/providing the
video 
  for viewing or having the video viewed (including without limitation 
  pay-per-view, subscription and advertiser/underwriter-supported
services)." To me that seems to include all free-to-air broadcasts ... 
You pay encoder/decoder fees for other services.
All this seems to imply a one-to-one link between the decoder and the 
service, which is not going to exist in this context of an open 
standard where any player can play any content -- so I wonder how this 
is going to be detailed.
Rob
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