[M4IF Discuss] To those concerned about MPEG- 4 Licensing ...

[William J. Fulco]

Rob,
> The licensors had already announced that there would be a grace period.

Yes- but have the been explicit as to how long and under what terms?  I'm
suggesting a long-ish "grace period" - given it takes years to develop a
market.
> Thinking as a potential licensee, I would rather know right away what I am
> dealing with before making major investment decisions, than having it free
> now but with unknown fees down the road.

Yes - I'm also suggesting that the structure of the fees for some things
like "MPEG-2 replacement" type uses be defined early and rationally.  More
esoteric things like "movies on demand" or "Surf-beach WebCam network" can
be fleshed out with some guidelines - without the exact details. Or - you
can put a "reasonable" license in place for a fixed period of time - say 5
years - "$0.25/encoder" and same for decoder now - and that license will be
good for 5 or 6 or 10 years. Then you can have a "renegotiation" phase...
> Having it clear as soon as possible is the best option for the
> entire market.

Yes - but what I'm saying is that when there is no market you can not
honestly tell what something is worth - and when the "time comes" - some
applications will die...  some will feel ripped-off and some will say "cool,
not as bad as we thought" - if we believe in the concept that it is THEIR IP
and they do get to charge whatever they want - then if they get greedy later
on and kill a golden-egg-producing-goose - then so be it - they're stupid
and nuts... on the other hand, we KNOW that the fees needed to launch a
market with little money in it have to be much lower than what the market
can sustain later on.... so like the baseball player that has a couple good
years and wants a more money at contract-renegotiation time - it's his right
to ask and the team's right to pay or not.
In short to launch the market, we need a "cheap" (possibly too cheap)
license to get going - and IF / WHEN the market develops later on, there
will be money available for the IP holders to get greedy with - or not.
Either way, there will be more information to make a rational decision in
the matter.
If you're going to "invest" huge amounts of money in content - then your
time-horizon is going to be longer and your need for certainty is greater -
and you may cut a side-deal with the MPEG-LA guys to keep yourself 'safe' -
on the other hand, if you're a small-time company - with little content -
that can't support just the overhead of the accounting for the use-fee -
well then, if in 4 years it suddenly gets onerous - you can change... in the
mean time if you want to know the end-game now and you won't do anything
until you do - well you'll be sitting on your hands saying "I won't do
anything until you give me guarantees" while YOUR competitors are taking the
risk and making the move....
Business is about risk - unknown future - years out is the least of many
company's problems that need to get a product out today.
++Bill
---------------------------------
William J. Fulco
wjf   NetworkXXIII.com
310-927-4263 (Cell)
Ne cede malis sed contra audientor ito!