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

[Rob Koenen]

Let's face it Bill - once the license gets established you
cannot in good reason make things cost more.
Increasing the price would be the tactic of a drug dealer,
and one could well argue that it is "unreasonable".
I believe the term of the MPEG-2 license is 5 year, and
that there are strict limits on the cost increase after 
the term of the license -- if there are any such increases
at all. 
"Side deals" are a non-starter, because the license needs
to be non-discriminatory. (Unless everyone, big and small,
gets the same side deal...)
The only reasonable market building strategy is the grace
period. 
> Yes- but have the been explicit as to how long and under what 
> terms?  

http://www.mpegla.com/news/n_02-01-31_m4v.html gives the answer:
The period is a year from start of licensing and the terms 
are "free".
Best Regards,
Rob
> -----Original Message-----
> From: William J. Fulco [mailto:wjf   NetworkXXIII.com]
> Sent: Wednesday, May 08, 2024 1:14
> To: rob.koenen   m4if.org; ramizer   wmr.com; 'Rob Koenen'
> Cc: discuss   lists.m4if.org
> Subject: RE: [M4IF Discuss] To those concerned about MPEG- 4 Licensing
> ...
> 
> 
> 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!
> 
> 
>