Access Advance Reveals Royalty Rates for Video Streaming Services
In January 2025, Access Advance announced the Video Distribution Patent Pool, initially announcing key incentives and a general framework. Following an interview with Access Advance CEO Peter Moller, I compiled the relevant Quick Facts that were posted at the time:
- The pool covers streaming content.
- Companies that would otherwise generate up to $25,000 in royalties for any six-month period will receive a royalty waiver in the form of a semi-annual credit of $25K, effectively excluding smaller entities like churches, schools, and small businesses.
- Covers HEVC, VP9, AV1, and VVC, with one charge for all content.
- Fees are tiered based on three key metrics: monthly active users, subscriber counts, and streaming revenue.
- Royalties start accruing on January 1, 2025.
- Licensees that joined by June 30, 2025, would have had previous royalties waived and a 25% discount through 2030.
- Access Advance expects most current patent owners from its existing pools to join, along with patent owners from other pools such as Sisvel, Via LA, and Avanci. Offsets will be provided for licensees that join two pools with duplicate coverage of the same patents.
- Access Advance acknowledges that some patent owners, like Nokia, will continue to license bilaterally and likely won’t join the VDP.
All of these quick facts remain true. On July 1, Access Advance disclosed the royalty rates and policies for the pool, in another interview with Moller and Dylan Zhou, Senior VP of Licensing for Access Advanced. You can download the following resources from the Access Advance site:
What follows is a rough Q&A to describe how the pool works, who it applies to, and where Access Advance hopes the industry will go. All quotes are from the July 1 interview.
Q: How much are the royalties?
Here’s the royalty table from the Program Overview.
Access Advance Royalty Table
Each licensee is assigned to a royalty tier based on the highest of three metrics: average monthly active video users, average monthly video subscribers, or semi-annual streaming revenue. These metrics are measured across all branded services owned or operated by the company, with activity in developing markets weighted at 50%.
Royalties are billed semi-annually and are based on a fixed monthly amount for each tier. Companies below the minimum thresholds for all three categories qualify for a full royalty waiver. Those in the “Base” tier pay a proportionally reduced amount, scaled down from Tier 1.
The top tier, Tier 5, carries a maximum rate of $5.25 million per month, or $63 million per year, and currently applies to only two or three companies worldwide, according to Access Advance.
The royalties shown include a 12.5% discount available through 2035 to Early Licensees who sign between now and June 30, 2026. If you don’t sign before that date, actual royalties will increase by 12.5%. Note that in developing countries, the number of active users and subscribers (see Program Overview appendix) are multiplied by .5 for purposes of calculating the tier levels above, producing significant royalty savings.
The Royalty Waiver and Estimated Target Market
We asked Moller and Zhou how many companies they thought were above the Royalty Waiver and would be subject to the royalties. “Our initial set of letters went out to about 100 companies,” said Moller. “I’d estimate between 100 and 250 companies globally would need a license under this program.”
Multiple Services Under One Roof
If a company has multiple streaming services, such as Disney, Amazon, and Fox, each service pays separately using the same schema defined above (see Program Overview).
The royalty structure included two innovative policies to ensure fairness: the Incremental Adjustment Option and the Royalty Adjustment Ladder.
What is the Incremental Adjustment Option?
The incremental adjustment option is designed to soften the financial impact of crossing from one royalty tier into the next. Instead of jumping to the full rate of the higher tier, a licensee can pay the lower tier rate plus a per-user (or per-subscriber or revenue) surcharge for the amount by which they exceeded the threshold.
Here's the example from the program overview.
For example, if an early Licensee has 1.01 billion Monthly Active Video Users, it would be subject to Tier 3 and owe $14 million semi-annually. However, this Licensee can opt to pay the lower Tier 2 semi-annual royalty of $10.5 million, plus the number of users over 1 billion times the Tier 2 rate (10 million x 0.021 = $0.21 million). Instead of $14M, the Licensee would instead owe $10.71M.
“It’s meant to address the cliff effect,” said Pete Moller. “At a macro level, until you get about 30% into a tier, it’s cheaper to use the incremental rate adjustment. Once you’re deeper into the tier, it becomes more economical to just pay the full rate.”
What is the Royalty Adjustment Ladder?
The royalty adjustment ladder ties the actual royalty payments to the percentage of the total patent stack currently represented in the pool. Access Advance assigns each licensor a point value based on factors like the number of patents, history of enforcement, and ecosystem influence. Once the pool reaches 75 points, licensees pay 100 percent of the published royalty rates. Until then, payments are scaled proportionally.
Here's the sample from the program overview.
For example, if the pool has 60 points on the “Ladder,” the rates will be proportionally adjusted to 60/75=80% of the full royalty rates.
“At the end of June we had 55 points,” said Pete Moller. “So, we’re currently adjusting royalties by multiplying them by 0.73. That means licensees are paying 73 percent of the full rate. We expect to hit or exceed 75 points by the end of the year.”
What does the total licensing stack look like, and how much of it will this pool cover?
Access Advance estimates that the pool currently represents about 60 percent of the overall patent stack for the four covered codecs. Moller said he expects that percentage to grow as more licensors join but acknowledged that some major patent holders will continue to license independently.
“There are always going to be companies like Nokia that prefer to license bilaterally,” he said. “We’ve already signed 31 licensors, including nearly half of the companies in the Sisvel and Avanci pools, and we expect to exceed 75 points on the royalty adjustment ladder by year-end. But yes, some companies will remain outside.”
Moller noted that both Via LA and Sisvel have indicated that they won't create a content pool, and many of their licensees have joined the Access Advance pool. While Avanci has launched its own streaming-focused initiative, Moller suggested there is still room for a consolidated approach. “I think there’s an opportunity for a one-stop shop,” he said. “We already have four significant licensees and strong industry support. If others follow, we could become that unified solution. But the industry will decide that by how it participates.”
Who Are the First Licensees?
Access Advance has announced four initial licensees: ByteDance, Tencent, Kuaishou, and NTT DoCoMo. All four operate major streaming or social media platforms with large video footprints across Asia and beyond.
It's an impressive start, but each company is also a licensor who has contributed patents to the pool. You would expect licensors to also sign up as licensees. If they didn’t, it would undercut the pool’s credibility. Their participation ensures the program launches with at least some market coverage, but it remains to be seen how many companies will join without a direct patent stake.
Moller confirmed that additional companies are in discussions and said Access Advance expects the list of licensees to expand substantially by the end of the year.
What's been the general response from streaming services that they've contacted?
According to Moller, the reaction has been pragmatic. “Nobody wants to pay a royalty,” he said, “but I think the industry understands that it’s time for them to contribute to the ecosystem.” He emphasized that the structure of the program has received consistent praise. “The feedback on the tiering, the rates, and the adjustment mechanisms has been very positive. Rates—sure, some people would like them lower. But even there, the pushback has been measured.”
Moller also framed early adoption as a signal of industry readiness. “Now that we’ve launched with such a great result in the first six months, we’re confident the next six months will be even more productive,” he said. “The conversations we’re having are constructive. People know what’s coming.”
Content Royalties
It’s clear that Access Advance isn’t the only group pursuing royalties from streaming services for video codec use. On June 24, Velos Media, a licensor in the Avanci pool, filed suit against TikTok and ByteDance, alleging infringement of six HEVC patents. In March, Nokia announced a bilateral licensing deal with Amazon covering video technologies used in Amazon’s streaming services and devices.
Double or even triple coverage by different patent pools isn't unusual; and neither are large patent owners seeking royalties directly from larger players. That approximates that state of the state for HEVC/VVC hardware-related pools. On the content side, Nokia and the patent owners in the Access Advance and Avanci pools all own unique patents they can individually enforce.
It's worth noting that so far, no U.S. court has ruled on whether charging royalties for content distribution is appropriate. Until there's a final judgment, streaming services won't know for sure whether these royalties apply. That said, Amazon assessed the risk-reward of litigating and signed the Nokia agreement.
Finally, enforcement efforts will likely focus on the same 250 or so companies identified by Access Advance, but there’s no guarantee that other platforms won’t be pulled in as well.
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