Mozilla's VP-of-Engineering explains on his blog:
http://shaver.off.net/diary/2010/01/23/html5-video-and-codecs/

Vimeo and YouTube seem to believe that reliance on proprietary plugins for
> video is a problem on the web. Mozilla believes that reliance on
> patent-encumbered formats is a problem on the web. Who’s right? Both groups
> are, in this case; that we can attack, from different perspectives, the
> multifacted problem of freeing video on the web is an example of the
> distributed innovation that has made the web such a powerful and popular
> platform.
>
> 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.
>

Jay

-- 
http://ryanishungry.com
http://momentshowing.net
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917 371 6790


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