Section 1 – Codec Manufacture and Sales
Products sold to end users and OEMs (except for products that are part of a personal computer’s operating system)
Decoder, encoder or product consisting of one decoder and one encoder = “unit”.
| Volume (per unit / annual reset) | Per Unit Fee |
| For the first 1 to 100,000 units | No Royalty* |
| For units 100,001 to 5,000,000 | $ 0.20 |
| For units 5,000,001 and more | $ 0.10 |
| *Available to one legal entity in an affiliated group. | |
| Enterprise cap:
$5 million/year 2006-2012 $5.5 million/year 2013-2027 |
|
Products incorporated into a personal computer’s operating system at the time of sale
Decoder, encoder or product consisting of one decoder and one encoder = “unit”.
| Volume (per unit / annual reset) | Per Unit Fee* |
| For the first 1 to 100,000 units | No Royalty* |
| For units 100,001 to 5,000,000 | $ 0.20 |
| For units 5,000,001 and more | $ 0.10 |
| *Available to one legal entity in an affiliated group. | |
| Enterprise cap:
$8 million/year 2006-2012 $8.8 million/year 2013-2027 |
|
- Includes right to make and sell VC-1 encoders and decoders with the right of End Users to use them for personal and consumer (including internal business) purposes without remuneration but not for other uses.
Both the coverage effective date and back royalty date is January 1, 2006.
Section 2 – Participation Fees
Where End User pays for VC-1 Video
Subscription (Not limited by title)
| Volume (per subscription) | Annual Fee |
| For the first 1 to 100,000 subscriptions | No Royalty |
| For subscription 100,001 to 250,000 | $ 25,000 |
| For subscription 250,001 to 500,000 | $ 50,000 |
| For subscription 500,001 to 1,000,000 | $ 75,000 |
| For subscription 1,000,001 and more | $ 100,000 |
Title-by-Title
| Length (per title) | Fee |
| 12 minutes or less | No Royalty |
| Longer than 12 minutes | Lower of (a) 2% of the remuneration paid in licensee’s first arm’s-length sale or (b) $ 0.02 per title |
Where remuneration is from other sources
| Description | Royalty | ||||||||||
| Free Internet Broadcast (not Title-by-Title, not Subscription) | No royalty for life of the VC-1 Patent Portfolio License | ||||||||||
| For Free Television | (a) one-time $2,500 per transmission encoder or
(b) Annual fee depending on the size of the broadcast market measured in households (“HH”)
|
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Enterprise cap (applies cumulatively across the participation fee categories in this Section 2):
- $4.25 M/year 2006-08
- $5M/year 2009-2012
- $5.5M/year 2013-2022
Coverage is effective as of January 1, 2006, and the back royalty date is from September 1, 2006.
The actual License agreement provides the only definitive and reliable statement of license terms.