I am hoping that the HTML 5 spec uses a free/Open source format also, restricting it to H.264 will leave out a lot of sites (which I'm sure google won't mind, killing youtube competition) when they can't afford the millions to buy a license. I like Mozilla's take on the situation, they have refused to support H.264, even though they could afford the fees, they are trying to look out for others who use the net for video distribution.
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For Mozilla, H.264 is not currently a suitable technology choice. In
many countries, it is a patented technology, meaning that it is illegal
to use without paying license fees
to the MPEG-LA. Without such a license, it is not legal to use
or distribute software that produces or consumes H.264-encoded content.
Indeed, even distributing H.264 content over the internet or
broadcasting it over the airwaves requires the consent of the MPEG-LA,
and the current fee exemption for free-to-the-viewer internet delivery
is only in effect until the end of 2010.
These license fees affect not only browser developers and
distributors, but also represent a toll booth on anyone who wishes to
produce video content. And if H.264 becomes an accepted part of the
standardized web, those fees are a barrier to entry for developers of
new browsers, those bringing the web to new devices or platforms, and
those who would build tools to help content and application development.
Some companies pay annually for H.264 licenses, which they can pass
on to users of their software. Google has such a license, but as they have described
, it does not extend to people building from
their source or otherwise extending their browser. (Apple and Microsoft
are licensors
to the MPEG-LA’s AVC/H.264 patent pool, so their terms may differ
substantially.) Personally, I believe that it is completely their right
to make such a decision, even if I would prefer that they made a
different decision.
Mozilla has decided differently, in part because there is no
apparent means for us to license H.264 under terms that would cover
other users of our technology, such as Linux distributors, or people in
affiliated projects like Wikimedia or the Participatory Culture
Foundation. Even if we were to pay the $5,000,000 annual licensing cost
for H.264, and we were to not care about the spectre of license fees for
internet distribution of encoded content, or about content and tool
creators, downstream projects would be no better off.
"