DivXNetworks licenses MPEG format to Fraunhofer

In what looks to be a case of selling sand to Saudi Arabia, DivXNetworks Inc said yesterday it has licensed its controversial DivX MPEG-4-based video technology to the Fraunhofer Institute for Computer Graphics (Institut Graphische Datenverarbeitung, IGD), inventors of the MPEG-based MP3 audio format.

Darmstadt, Germany-based Fraunhofer plays a key part in developing and driving compression standards, with varying degrees of success. Companies such as Microsoft Corp and RealNetworks Inc are trying to supplant the ubiquitous MP3 with their own formats but so far have had far more success in video streaming than MPEG-based compression methods.

"We are interested in utilizing a streaming server to create an infrastructure for group communication in a 3D environment, and DivX video technology will provide an important element of our research," said Frank Morbitzer, who leads the project for cooperative virtual environments at Fraunhofer IDG.

DivX is a compression method based on MPEG-4 that gained notoriety mainly due to its continuing use as the format of choice for video bootleggers.

DivXNetworks has, however, disassociated itself from the legal gray area of its roots, and has started signing up big name clients, such as Muppet creator The Jim Henson Co.

Separately yesterday, DivXNetworks announced a deal with Sigma Designs Inc, which makes media decoding cards for set-top boxes. Sigma will support DivX in its forthcoming X-Card Home Theater gadget, and the companies will jointly market the product.

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