Saw this post on Streaming Media Magazine, found we share a same opinion with HEVC, so forward it to my blog.

Elsewhere in the issue, you find a 4,000-word article I wrote on VP9 that doesn’t mention HEVC. Why? Because for the vast majority of streaming producers that don’t distribute 4K video to smart TVs, the codec decision isn’t VP9 versus HEVC. It’s H.264 versus VP9, and HEVC isn’t really in the picture.

This dynamic highlights the reality that standards-based codecs are declining in importance, particularly in the streaming space. The success of H.264, first with Flash and later with HTML5, merely masked this trend. That is, H.264 was wildly successful in streaming (and later HTML5) because Adobe selected it for Flash, not because it was a technology standard. This is a subtle but critical distinction. It’s also a very significant sea change.

My first job in the codec world involved marketing a proprietary fractal-based codec for use on CD-ROMs. Our biggest competition came from codecs such as Indeo and Cinepak, and from an emerging standard called MPEG-1. My company never got traction, and (according to ancient memory) the three companies that sold MPEG-1 codecs were all purchased for more than $40 million. The lesson burned into my brain was that standard-based codecs always win.

In this regard, there was never any question that MPEG-2 would be the codec for DVD and early cable and satellite systems. The next standard, H.264, was deployed in satellite and cable and all the associated STBs, and later in mobile devices and retail OTT devices such as Roku and Apple TV. H.264 was the best performing codec around, and by the time VP8 arrived, H.264 was impossibly entrenched. Plus, with a reasonable cap of about $5 million per year (back in 2010, now $8.125 million for 2016), H.264 royalties were affordable, ensuring ubiquitous playback.

Fast-forward to 2016. H.264 is still everywhere, but it’s showing its age. VP9 provides the same quality at 50 percent to 60 percent of the bandwidth, and playback is free in the current versions of all browsers except for Internet Explorer and Safari. The Alliance for Open Media launched in September 2015, consolidating the development of three open source codecs into one engineering group. Google, Mozilla, and Microsoft are founding members, ensuring fast browser support for the first codec (called AV1), which should ship by March 2017. Members Netflix, Amazon, and Google (YouTube) will ensure fast deployment by large web publishers, while members ARM, AMD, Intel, and NVIDIA presage prompt support in hardware.

AV1 is free, while HEVC costs up to $1.20 (or more) per unit with a cap of up to $65 million, and that’s just for the two (of potentially four or more) IP owners with announced terms. With VP9 and AV1 freely available, there is no need for HEVC to deliver to computers and notebooks, and there is no business case (or realistic business model) for licensing HEVC in a browser.

The mobile device landscape is less clear. Apple included HEVC in FaceTime but removed any mention of the technology from its spec sheets after the second HEVC patent group formed. This ensures that Apple will pay far more in HEVC royalties than it will ever receive, making a strong business case for deploying AV1. Android 5.0 includes HEVC software decoder, with hooks to HEVC hardware decoder. However, both royalties are paid by Android licensees, not Google, which is clearly banking on AV1 for the future of YouTube.

Broadcast infrastructures, set-top boxes (STBs), and smart TVs will remain HEVC for a while. But with YouTube choosing VP9/AV1 for its UHD videos and Netflix, Amazon, Microsoft, and the hardware vendors behind AV1, support for the alliance codec in future smart TVs and STBs is assured. HEVC certainly won’t be the only technology these devices support.

The bottom line is that broadcast, with its hundreds of disparate publishers and suppliers, needs a formal standard. The streaming world just needs a reliable, well-supported technology, so a de facto standard set by a group of technology leaders and users is just as good. In fact, it’s better, if you consider the price tag.

This article originally ran in the Autumn 2016 European edition of Streaming Media magazine as “The Decline of the Standards-Based Codec.”