NEWS LETTER

 By 세연테크

Introduction to H.264/H.265 Licensing Issues 

In this newsletter, we will introduce the H.264/H.265 licensing issue at SeyeonTech.

hello.  This is our first newsletter of 2024.

The other day, we received an inquiry from a customer about how Seyeon Tech handles H.264/H.265 licensing issues. When we asked why, it was related to the fact that patent lawyers have been checking patent licenses at domestic and overseas exhibitions recently. I remember that many manufacturers got the measles from the MP3 patent license a long time ago. 

SEYEONTECH has already signed a contract three years ago and is making quarterly payments. When I looked at the H.264/H.265 licensing situation for domestic CCTV companies, I was surprised to see that there were very fewer manufacturers than I expected. A manufacturer here means a company that sells finished products using a trademark (brand). 

Below, we share information about the H.264 and H.265 patents we have found so far in the form of a Q&A. (This information is included in our July 2021 newsletter)

1. When do I have to pay the video compression patent fee? (HEVC, AVC/H.264)

A. Companies and individuals selling finished products or software containing one or more H.264/265 decoders or encoders are required to pay the patent fee. However, if a license contract is signed, there is a free license per quarter or year for each patent fee billing organization. The full patent fee must be paid retroactively for products sold before the contract.

B. The CCTV field includes finished products such as IP cameras, DVRs, NVRs, VMS, cloud services, etc.

C. The license is divided into HEVC (H.265) license and AVC/H.264 license.

Q. 특허료를 받는 기관이 어디인가요?

A. By 2020, we have identified four. We know that two of them, MpegLA and AccessAdvance, are concentrated patent fee charging organizations and we believe it is preferable to enter into agreements with them first.

B. MpegLA : https://www.via-la.com/

C. AccessAdvance : https://accessadvance.com/

3. How much is the patent fee?

A. Hardware such as IP camera, NVR, etc. is less than 1$ per unit. AccessAdvance, MpegLA, etc. all need to be paid independently. Patent fees will be charged when you report the number of units sold for each period after the contract.

B. Pre-contract royalties are also charged as a lump sum royalty on the total number of units sold.

4. Who is eligible for the license?

A. Individuals and companies selling finished products or software containing one or more HEVC, AVC/H.264 Decoder/Encoder are eligible.

B. Semiconductors or modules are not applicable, and the license agreement must be signed by a company that produces/sells finished products using such parts or modules.

C. In the case of OEM/ODM, the license agreement must be signed by the seller of the final product, not the manufacturer.

D. Among the domestic CCTV companies confirmed by seyeontech, the companies that have licensed the patents are as follows

i. MPEG LA HEVC License : SeyeonTech, Hanwha, IDIS-, etc.

ii. MPEG LA AVC/H.264 License: Seyeon Tech, Hanwha, IDIS

iii. AccessAdvance HEVC License: SeyeonTech, Cipro, Hanwha, IDIS, Truen

iv. Related Links

1. https://accessadvance.com/hevc-advance-patent-pool-licensees/

2. https://www.via-la.com/licensing-2/hevc/hevc-licensees/

3. https://www.via-la.com/licensing-2/avc-h-264/avc-h-264-licensees/

E. seyeontech is paying patent fees to eliminate any possible friction not only for products shipped under the seyeontech brand, but also for finished products shipped as OEM/ODM.

5. license term

A. The contract will tell you the term. For example, Access Advance is until December 31, 2025. We understand that you can extend the contract after that.

6. How to pay royalties?

A. You report according to the royalty statement form and we will issue an INVOICE, and you pay.

7. How do I sign a contract?

A. Contact the organization directly and they will explain in detail.

8. etc.

A. The above is based on our experience, and may be wrong for each company. However, here are some things to consider

i. Royalties have benefits such as tax reductions from the time of the contract, and there are no tax reductions without a contract.

ii. The amount of each organization's royalty is estimated to be no more than 1$ per camera.

iii. Individuals or companies selling end products, i.e., last order trademarks, and individuals or companies selling as OEMs must have a patent contract.