The MP3 Patent and Its Expiry – A Patent Agent’s Perspective

A long, long time ago, when mankind first started to digitize audio into computer formats, they used wave files, which typically sported the extension “WAV”. These wave files stored audio faithfully, while preserving their values, but required great amounts of storage space, as they were typically quite large.

After much effort and study of the problem, a group of clever researchers came up with the “MP3” format, which was a “lossy” audio format. This development made it possible to convert wave files to the MP3 format, which took up much less storage, thus paving the way for the digital music revolution. (This development was also paralleled in the digital images industry, where images were first scanned and digitized as bitmaps… with the extension “BMP”. That all changed with the rise of “lossy” encoding, through the JPEG file format.)

 

Music became more and more commonly digitized. I remember ripping CD’s using nothing more than a personal computer and a CD-RW drive. It made it possible for me to store quite a bit of my CD collection in my old desktop computer (which sadly, has figuratively died and gone to computer heaven). It was a wonderful time for young people who loved music; so much so that they began swapping CD’s and ripping each others’ CD’s into their own computers.

Napster began as a peer-to-peer (P2P) file sharing service, enabling people to share the music files that they owned, with their peers. Normally, this would not be controversial, as friends often do swap their books and CD’s. The problem was that copyrighted material was now digitized and shared with the whole wide world (commonly known as “WWW”), thus leading to a loss of music CD sales.

The music recording industry panicked, and launched an all-out attack on Napster and its ilk. Other services, such as Audiogalaxy (which I used), were targeted as well. A new threat was identified: Torrenting, which continues to this day.

The music industry mourned the demise of its glory days.

The courts meted out heavy fines and penalties. Young and old, men and women who shared songs like  “Happy Birthday” and “Merry Christmas” on their hard disks soon found themselves facing the long arm of the law.

Sharing got a bad name then.

 

Here’s how it happened, the way I saw it.

Apple began with the iPod. (Thank you, Steve Jobs.) The iPod was an MP3 player that could pack as many songs as a DJ would require to play a gig, and carried the promise of a thousand songs in your pocket. It took off, in a big way, that nobody had anticipated.

That famous MP3 player launched a whole industry of copycats. (Steve Jobs’ statement that Apple cannot be the “innovator for the world” comes to mind.) Eventually, there was a massive showdown between Apple and Creative Technology (over the MP3 player patent), which was settled.

And then Apple launched its online music store. Overnight, people could buy songs that they loved, that they hadn’t heard in years, that were obscure, and that were out of production. Music catalogues that were old and dusty suddenly found their long lost fans, and new fans were born out of the process. And with that discovery came the call for the “long tail”, where there was apparently more money to be made out of selling obscure copyrighted works to a small but loyal group of purchasers.

The years went by, broadband became better and more widespread… Internet radio became commonplace, in many cases instituted by actual radio stations, but in many more cases, set up by fans of online radio, motivated individuals, and other groups.

 

 

Once upon a time, everyone used to have a VCR, and they rented video tapes from the local video shop. They used to watch Cantonese dramas, WWF wrestling series, and others. Everything was analogue, and copies of video tapes used to look terrible. There was no incentive to duplicate video tapes.

Slowly, as technology shifted, VCD’s became popular. The movie rental business stayed in business, the staple of bored housewives and old men. Children used to clamour around these shops, asking their parents to rent the latest movies. One of the most popular movie rental businesses was “Blockbuster”, which at its peak, had more than 9,000 video rental shops in the USA.

But then the Internet revolution happened, and it became possible for people to stream videos, rather than downloading them first. That was then startups like Netflix found their niche.

Overnight, the movie rental business was overturned, as more and more people decided to opt for a subscription instead of renting movies from the movie store. As society becomes more populous, and real estate becomes more scarce, things which save space become more attractive… so online movie rentals replaced real life movie collections, and real life movie rentals. (Just like gyms remove the need to have your own exercise equipment at home.)

And just like that, online music subscriptions, too, became popular. Because the formula had been proven to work, in the movie industry, venture capitalists were eager to find the Netflix of the music industry. Today, the most popular music subscription startup is Spotify.

MP3 was the star of this show. The music industry was forever changed thanks to the rise and rise of the ubiquitous format. And it seems to have held its ground even in the face of new, competing formats, such as Ogg Vorbis (lossless codec!) and AAC.

In the battle for file format supremacy, the key is to be adopted widely, by both manufacturers as well as consumers. MP3 players drove the demand for the file format (smartphones in those days had very little storage and generally did not exceed 256MB.) Later, Steve Jobs had a flash of inspiration while sitting under an apple tree… and the iPod was merged with mobile phone technology to give us today’s smartphone revolution, with touchscreens, huge storage, 4G technology, app stores, and downloadable copyrighted materials that we must pay for through those darn pesky app stores.

The battle for adoption of MP3 has been won… unlike the earlier fight of ages past, the Sony vs Betamax war, and much later, Blue-Ray vs HD DVD. But new forms of technology are emerging, and new file formats need to be developed to encode ever greater amounts of information in ever more efficient ways. (The rise of 360 videos is something to marvel at, and an example of evolution of an established format: video).

 

The team that helped create the MP3 format (photo from 1987).

On the website for Fraunhofer IIS (Fraunhofer Institute for Integrated Circuits ) it was stated:

On April 23, 2017, Technicolor’s mp3 licensing program for certain mp3 related patents and software of Technicolor and Fraunhofer IIS has been terminated.

We thank all of our licensees for their great support in making mp3 the defacto audio codec in the world, during the past two decades.

The development of mp3 started in the late 80s at Fraunhofer IIS, based on previous development results at the University Erlangen-Nuremberg. Although there are more efficient audio codecs with advanced features available today, mp3 is still very popular amongst consumers. However, most state-of-the-art media services such as streaming or TV and radio broadcasting use modern ISO-MPEG codecs such as the AAC family or in the future MPEG-H. Those can deliver more features and a higher audio quality at much lower bitrates compared to mp3.

The MP3 format is now finally free from patent protection. Long may it live.