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Google (finally) nabs On2 video codecs

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Google has completed its acquisition of video compression outfit On2 Technologies. On Friday, according to brief statements from the two companies, On2 shareholders voted to approve a deal valued at approximately $124.6 million.

That's roughly $18 million more than the value Google named when it first announced the acquisition in August. The original $106.5m pact was challenged in court by a group of On2 investors who said it undervalued the company. They eventually settled their suit, and last month, Google upped its offer.

The question is still whether Google will turn around and open source On2's video codecs. In announcing the original pact, Mountain View made a point of saying that it believes “high-quality video compression technology should be a part of the web platform” — and that On2 is a means of reaching that end.

The major web browser makers - including Google, Apple, Mozilla, Opera, and Microsoft - have failed to agree on a single common codec for the new HTML5 video tag. The HTML5 spec allows for any codec, and while some have opted for the open and license-free Ogg Theora, others are sticking to the license-encumbered H.264 for reasons of performance, hardware support, and alleged patent anxiety.

On2 Technologies' VP3 codec is the basis for Ogg Theora. In 2001, On2 open-sourced VP3 under an irrevocable free license. But in the years since, the company has continued to improve its codecs, releasing five subsequent generations. ®

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