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Update: This story has been updated to show that the MPEG-LA's license change applies to free video broadcasts, not applications that encode and decode video.

MPEG-LA — the organization that oversees the H.264 video codec on behalf of patent holders such as Apple and Microsoft — has made its latest move in what's shaping up to be an intriguing chess game with the likes of Google, Mozilla, and Opera.

On Thursday, the patent pool organization announced that for the H.264 license used by free web video, it will continue to waive royalty fees through the entire life of the license. Previously, MPEG-LA said it would waive royalties for licensees only until December 31, 2015.

This means that if you use H.264 solely for free web video, you will never have to pay a fee to the MPEG-LA. It does not rule out the possibility, however, that some other patent holder outside the MPEG-LA will come calling.

The move is an apparent response to Google's WebM web-media format, which was open sourced in May under its a royalty-free license. At the heart of WebM is the VP8 video codec Google that acquired when it purchased video compression outfit On2 Technologies in a deal valued at $124.6 million. Google's aim was to create a completely royalty-free alternative to H.264 for use with the fledgling HTML5 video tag, and the new WebM format was promptly embraced by Opera and Mozilla.

Prior to the introduction of WebM, Opera and Mozilla backed the open source Ogg Theora codec — an inferior technology to VP8 — declining to put a royalty-encumbered codec into their browsers. Originally, MPEG-LA's H.264 license for free web video waived royalties until January 1, 2011. But in what seemed to be a response to Mozilla and Opera, the organization expanded its royalty-free period through 2015. For Mozilla and others, the worry was still that the MPEG-LA would lock developers into the license while it was free and then begin charging for use.

Now the MPEG-LA has lifted royalties from the license entirely, but it will continue to charge when H.264 is used for products and services other than free video broadcast, including applications that encode and decode video. Google, Mozilla, and Opera are sure to push ahead with WebM. The three outfits did not immediately respond to a request for comment.

Whereas Opera and Mozilla have committed to WebM, Apple and Microsoft are sticking with H.264 — though Microsoft has said that Internet Explorer 9 users will be able to use WebM if they install it on their machines themselves. Apple's Steve Jobs has made it clear he has no interest whatsoever in WebM, and we're likely headed for a clash of the titans. After Google open sourced VP8, the MPEG-LA said it was "looking into" a patent-pool license for VP8, challenging Google's effort to make it completely free, and Jobs has indicated that he won't adopt open video codecs because they're subject to patent attack.

But Apple is part of the MPEG-LA's H.264 patent pool — as is Microsoft. The chess game has only begun. ®

Update

Mozilla has now responded, questioning the importance of MPEG-LA's more. You can can read more here.

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