Emmett Plant is one free software fan who figures that MPEG-4's loss is the open-source movement's gain. The CEO of Xiph -- producers of Ogg Vorbis, an open-source alternative to the MP3 format -- Plant says that the MPEG-4 licensing terms will force developers and the market to give open source a more serious look.

"It's hard to see this as a bad thing in any way whatsoever," he says. "It's just going to open the gap wider between what should be used, open source, and what shouldn't be used, things like Microsoft Media Player."

Plant has a stake in the outcome of the battle over which "codec" -- the technical term for software that compresses and decompresses audio, video and other kinds of data -- will win. His company is in the early stages of developing Tarkin -- a new video compression format. He says that the nature of open source -- in which volunteers contribute their time and effort to the development of a publicly available code base -- will let Tarkin and other open-source technologies undercut the competition.

"It's a cost issue," he says. "With the expensive cost of MPEG-4 and Real and Microsoft, people are going to listen to us."

Even if Tarkin never manages to be as versatile as MPEG-4, the product of hundreds of millions of dollars in research and development, some believe that the market will still make room for it. Just as Ogg Vorbis-encoded songs now pepper the Web and can be found in several games, such as Bohemia Interactive Studio's Operation Flashpoint and Croteam's Serious Sam, Tarkin could satisfy content creators who want the cheapest available option.

"There's enough room on the distribution medium for a company to decide to use a codec that compresses less well but is a lot cheaper to use, says Lourens Veen, a Tarkin developer. "I don't think companies will be very happy to use MPEG-4 in their shelved products, and I wouldn't be surprised if they chose to use older, cheaper codecs, instead."

One possible alternative that's already on the market is On2 Technologies' VP3. The VP3 codec was made open source last year. And while it can't match MPEG-4 in terms of power -- its compression isn't as powerful, and unlike MPEG-4, it can't handle interactive gaming or wireless devices -- VP3-encoded content has already appeared on a few prominent Web sites, including U2's. With MPEG-4's new licensing terms, more will surely follow, says Doug McIntyre, On2's CEO.

"This is the chance to push open access to something without patents," he says. "It's the opportunity to have a complete free flow structure for streaming. When you use an open-source codec, you're talking about something where you know who the patent holders are; you know they have an open-source license so you can do whatever you want with it. There's no cost for the decoder or a use fee."

In short, "Open source has two advantages," he says. "First, it doesn't cost anything. Second, you don't need approval to toy with it -- you don't have to ask permission to go to the bathroom."

But however compelling the argument for open source may sound to the already converted, the question remains whether the big content-creation companies and mainstream entertainment consumers will go along. When everyone has a computer with Windows Media Player preinstalled, won't it just make more sense to produce content that Media Player will play? And will users feel any need to change, if they download a TV show or game and Media Player starts automatically? How are open-source alternatives going to gain any traction?

The Internet Streaming Media Alliance (ISMA) -- a nonprofit group of companies seeking to promote open standards -- believes there is a way. After the MPEG-4 licensing terms were released, McIntyre sent a letter to ISMA, reminding the group that VP3 was freely available. He says he immediately received a positive response. Tom Jacobs, the organization's president, asked McIntyre to join the group and began looking more seriously into open-source alternatives.

"Our first choice is to reach out to MPEG-LA," says Jacobs. But if the group refuses to kill the use fee -- which Jacobs calls a "revenue grab" that will double streaming costs for most major content creators -- he predicts that Apple, Sun and the other members of ISMA will move on to cheaper pastures.

ISMA's interest in open source could simply be a ploy or a bluff. In a game of high-tech brinkmanship, the theory goes, ISMA may simply be using open source to let the MPEG corporations know that high prices will drive the market to cheaper alternatives.

Jacobs denies the charge. "Honestly, that is the first time anyone has raised that question," he says. "ISMA's position is really clear. There are massive economic issues with use taxes, not minor points that get massaged at a bargaining table."

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