MPEG LA Debuts One-Stop ATSC 3.0 Patent Pool With 13 Licensors

Thirteen licensors populate the one-stop patent pool for ATSC 3.0 technologies that MPEG LA launched Thursday, as was expected recently after about three and a half years of development (see 2112100004).

MPEG LA originally planned to have the patent pool operational by early 2019 but said last month that some pools take longer to launch than others. MPEG LA announced a call for patents essential to the 3.0 suite of standards in August 2018 (see 1711010054), about nine months after the FCC authorized 3.0's voluntary commercial deployment.

The MPEG LA pool covers patents owned by the 13 entities as they're embedded in 15 standards documents in the 3.0 suite, including those for virtually all the suite's core operational specs, such as its physical layer, system discovery and signaling, interactive content and application signaling. The pool excludes coverage of patents germane to a half-dozen standards documents on 3.0's video and audio codecs, audio and video watermarking and its dedicated return channel. Owners of patents in those standards documents will license their IP independently of the pool, as will holders of 3.0-essential patents that didn't join the pool.

Initial licensors in the pool are CableLabs, Cerinet USA, Communications Research Centre Canada, Dolby, Fraunhofer-Gesellschaft, KPN, NEC, the NERC-DTV National Engineering Research Center in Shanghai, NHK, One Media, Panasonic, Philips and Sun Patent Trust. MPEG LA as recently as last month said it didn’t yet have a final licensor count for the pool.

Nineteen patents comprise the initial pool, with Fraunhofer controlling the most patents of any entity with four -- two in South Korea, two in the U.S. -- says a briefing document. MPEG LA’s objective “is to offer worldwide access to as many ATSC 3.0 essential patents as possible to everyone on the same terms under a single license,” said the administrator. It welcomes “any party that believes it has patents that are essential to the ATSC 3.0 standard to submit them for an evaluation of their essentiality by MPEG LA’s patent experts,” it said.

The pool’s “current term” runs through 2027, and is “renewable for successive 5-year periods for the life of any Portfolio patent on reasonable terms and conditions,” says the briefing document. Many pools have a “rate protection on renewal,” and the 3.0 license has one, too: “Royalty rates applicable to specific product license grants will not increase by more than 20% at each renewal.”

Taking a one-stop license in the pool will cost licensees $2.75 per TV set that contains up to two 3.0 receiver chips built into the single product, says the briefing document. The third and fourth tuners in a TV will cost 50 cents each; additional ones are 25 cents each. Royalties owed for the period 2018-2021 are capped at a flat $3 million. An annual $4.5 million cap kicks in this year, and caps then will “increase or decrease in each subsequent year of the first term” ending 2027.

The cap will rise or fall “by a percentage equal to the average percentage increase or decrease in the production of such products by the top three worldwide producers based on the increase or decrease of their unit Sales during the previous year,” says the briefing document. The pool builds in an incentive clause to speed adoption of the 3.0 license. It’s offering 50% discounts on back royalties owed for products sold Jan. 1, 2018, to Dec. 31, 2021, for licensees that sign on within six months.

Though Dolby is among the pool’s initial licensors, it’s for a single patent granted in Japan (JP 5,562,408) that’s not germane to the AC-4 audio codec used for 3.0's deployment in the U.S. (the Fraunhofer-administered MPEG-H audio codec is deployed for 3.0 in South Korea). The Dolby audio codec is the centerpiece of a legal battle just underway in U.S. District Court in Manhattan, where LG alleges Dolby reneged on its commitments to ATSC and other standards-setting organizations to license its AC-4 patents on fair, reasonable and nondiscriminatory (FRAND) terms (see 2201090001).

"FRAND is an undertaking by individual patent holders who participate in standards setting organizations," emailed an MPEG LA spokesperson without addressing the LG-Dolby litigation. "MPEG LA does not participate in standard setting organizations and its licenses make no representation to that effect. Presumably, licensors who agree to the undertaking believe the pool license is consistent with it, and we are confident the market will agree."

MPEG LA i's proud to continue its role in support of the broadcast industry’s next generation terrestrial broadcast system that began with our licenses for the ATSC 1.0 standard and the MPEG-2 video compression standard used in ATSC 1.0,” said MPEG LA CEO Larry Horn. The 3.0 pool addresses “the market’s need for transactional efficiency and predictability in accessing necessary intellectual property rights owned by many different organizations under a single license,” he said. MPEG LA said last month that the license would be “timely in light of the expected ATSC 3.0 ramp-up.”

Formation of the pool “will dramatically simplify the efficient licensing of the new ATSC 3.0 broadcast technology in multiple-receive devices, easing the distribution and deployment process,” said Sinclair’s One Media. The ability to offer 3.0 technology “to consumer equipment manufacturers in a simple, all-encompassing license should ease the process of deploying sophisticated new receivers to consumers worldwide,” said Executive Vice President Jerry Fritz.