Updated November 2026: AOMedia released AV2 in June 2026, Via LA moved H.264 streaming to tiered fees, the 2026 Apple TV 4K decodes AV1 in hardware, and the streaming patent pools and InterDigital’s HEVC injunctions against Disney changed the licensing picture.
Why this matters
If you run a streaming product, the codec decision quietly sets two of your biggest numbers at once: how many people can watch (reach) and how much you pay to deliver every stream (the egress bill). Pick a codec too aggressively and the newest phones look great while a third of your audience sees an error screen; pick too conservatively and you pay to ship 40% more bytes than you need to, every month, forever. This article is written for the founder, product manager, or streaming CTO who has to make that call and defend it — not for the engineer tuning the encoder. We keep the internal mechanics of each codec at arm's length (those live in our Video Encoding section) and focus on the only question that touches your business: which codecs belong in your catalog, for which devices, at what cost. By the end you will be able to read a codec proposal and ask the four questions that matter — what does it reach, what does it save, what does it cost to license, and what does it cost to encode.
Which codecs should an OTT platform use in 2026? The short answer
Most OTT platforms in 2026 should run two codecs. H.264 goes on every title as the floor that plays on any device, and AV1 is the efficiency tier for devices that decode it in hardware, at roughly half the bytes of H.264 for the same picture. HEVC is the fallback for older Apple and smart-TV devices and for 4K HDR where AV1 is missing. VVC and AV2, which AOMedia released in June 2026, are watch items: neither has the browser and device support a streaming catalog needs yet.
A codec is a product decision, not a technical one
Start with what a codec actually is. The video coming out of a camera or an editing suite is enormous — far too large to send over the internet in real time. A codec (coder-decoder) is the agreed method for compressing that video down to a streamable size and decompressing it again on the viewer's device. H.264, HEVC, AV1, and VVC are four such methods, each newer and more efficient than the last. How they achieve compression — the block transforms, motion prediction, and entropy coding inside them — is a fascinating engineering subject, and it is covered in depth in our Video Encoding section. For building an OTT platform, none of that matters directly. What matters is the trade-off each codec forces on your product.
That trade-off has four levers, and every codec choice moves all four at once.
The first lever is reach — the share of your audience whose devices can decode the codec and play the video. A codec the device cannot decode is not a slower stream; it is a blank screen. Reach is the lever you can never sacrifice, because a viewer who cannot play anything churns immediately.
The second lever is efficiency — how few bytes the codec needs to hit a given picture quality. Efficiency is usually quoted as bitrate savings against H.264: a codec that delivers the same quality at half the bitrate is "50% more efficient." Because a content delivery network bills you for the bytes you send to viewers — a recurring cost called egress — efficiency is the lever that bends your monthly delivery bill. Lead with this one: at scale, the codec that halves your bitrate halves the line item that decides your margin.
The third lever is licensing — whether the codec is free to use or carries patent royalties, and how much legal certainty comes with the answer. This lever is invisible until a patent pool sends an invoice, and it has sunk more than one codec's adoption.
The fourth lever is encode cost — the compute you burn to compress each title. A more efficient codec is almost always harder to encode, so the egress you save on delivery is partly paid back in the transcoding farm. For a large catalog or a live stream, that cost is real and has to be weighed.
Figure 1. Every codec choice moves four levers at once. No codec wins all four, which is why a catalog usually carries more than one.
H.264 (AVC): the reach floor you cannot skip
H.264, also called AVC (Advanced Video Coding), is the codec that plays on essentially everything. Finalized in 2003, it has hardware decoding in every smartphone, tablet, laptop, smart TV, set-top box, and game console made in the last fifteen years. That universal reach is its entire value proposition, and it is the reason H.264 is still the floor of almost every catalog in 2026.
The cost of that reach is efficiency: H.264 is the least efficient of the four codecs here, and it is the baseline everything else is measured against. It is also not free — H.264 is licensed through the patent pool now run by Via LA (formerly MPEG LA). For years that licensing was a settled, modest cost. In 2026 Via LA replaced the flat $100,000 annual cap on streaming with tiers that reach $4.5 million a year for the largest platforms; the new terms apply to companies taking a license from 2026, while existing licenses are grandfathered for now (Streaming Media, April 2026). The encoding side, by contrast, is cheap and instant: H.264 encodes faster than any newer codec and runs on hardware everywhere, which is why it remains the default for live streaming where there is no time to spend on heavier compression.
The product takeaway is simple. You keep H.264 in the catalog not because it is good at saving bytes — it is the worst of the four at that — but because it is the only codec you can be certain every viewer can play. It is your insurance rung. The strategy question is never "H.264 or something newer?" It is "H.264 plus what?"
HEVC (H.265): more efficiency, more licensing pain
HEVC, or High Efficiency Video Coding (H.265), arrived in 2013 as the successor to H.264. It delivers roughly 40–50% bitrate savings at equal quality — close to the same picture for half the bytes — and it was the first codec to make 4K and HDR streaming practical. On the device side it has strong reach in exactly the places H.264 dominates the living room: every Apple device since 2015, almost all smart TVs and set-top boxes, and most recent Android phones decode HEVC in hardware. Its weak spot is the open web. Safari plays HEVC, Chrome has decoded it since Chrome 107 (2022) and Firefox since version 134 on Windows (January 2025), but only where the device has an HEVC hardware decoder, so desktop browser coverage is still patchy.
HEVC's real problem is the third lever: licensing. Where H.264 has one pool, HEVC is fragmented across several. The largest is the HEVC Advance pool run by Access Advance, which lists over 29,000 patents; a second pool was run by Via LA until December 2025, when Access Advance acquired it and renamed it the VCL Advance program; and on top of both pools sit patent holders who license individually and are in no pool at all, Velos Media among them since it closed its pool in 2023. For a platform operator, the encouraging news is that since 2018 the device-focused HEVC pools have not charged a royalty on streaming content itself — the royalties fall on device makers, not on the titles you distribute. The discouraging news is that two streaming-distribution pools, Avanci Video and Access Advance’s Video Distribution Patent (VDP) pool, now ask streaming services for exactly those royalties, covering HEVC, VVC, AV1 and VP9 together. By September 2026 the VDP pool had 46 licensors and had signed Meta, Alibaba, ByteDance, Roku and Tencent as licensees (Access Advance, September 2026). Device rates rose as well. New HEVC Advance licensees signing after 30 June 2026 pay rates 25% higher than earlier signers. InterDigital has won a series of injunctions against Disney over video-coding patents, most of them HEVC: three from the Munich Regional Court between October 2025 and February 2026 and three from Europe’s Unified Patent Court between June and September 2026. After the UPC rulings Disney dropped 4K and HDR streaming in the affected European countries. The map keeps changing, and the uncertainty is the cost.
The product takeaway: HEVC buys you a real efficiency gain and excellent living-room reach, especially for 4K and HDR, but you adopt it knowing the licensing picture is fragmented and moving. For many platforms, HEVC's natural role in 2026 is the premium 4K/HDR tier on Apple and smart-TV devices — and increasingly, the question is whether AV1 should take that role instead.
AV1: royalty-free efficiency that finally has the hardware
AV1 is the codec that changed the strategy. Released in 2018 by the Alliance for Open Media (AOMedia) — a consortium that includes Google, Netflix, Amazon, Microsoft, Meta, and Apple — AV1 was built to do two things HEVC could not: be meaningfully more efficient, and be royalty-free. On efficiency it delivers roughly 20–30% bitrate savings over HEVC, which is around 50% or more over H.264 — the same quality for half the bytes or better. On licensing, AOMedia publishes AV1 under a royalty-free patent license, and its members cross-license their own patents into it.
For years AV1 had one fatal weakness for streaming: almost nothing could decode it in hardware, so playback fell back to software, which drained batteries and overheated phones. That weakness is gone. As of 2026, AV1 hardware decoding ships on the iPhone 15 Pro family and all iPhone 16 and 17 models, on Macs with M3 silicon and newer, on Android flagships built around recent Qualcomm Snapdragon and MediaTek Dimensity chips, and on the large majority of smart TVs and streaming devices sold since 2022 — Samsung, LG, Sony, and Hisense TVs, Chromecast with Google TV, the 2022-and-later Amazon Fire TV Stick 4K, Roku Ultra, and the fourth-generation Apple TV 4K, announced in October 2026 with a dedicated AV1 hardware decoder in its A19 chip. Netflix reported that 88% of large-screen devices submitted for its certification over 2021–2025 support AV1. The proof is in deployment: AV1 powered about 30% of all Netflix streaming by December 2025; more than 90% of YouTube’s catalog, weighted by watch time, was available in AV1 by March 2026; and Meta calls AV1 the most popular delivery format for Facebook and Instagram video (AOMedia, October 2026).
AV1's licensing carries one asterisk worth stating plainly. Although AOMedia offers it royalty-free, Sisvel runs an AV1 patent pool, and both streaming-distribution pools, Access Advance VDP and Avanci Video, list AV1 among the codecs they license to streaming services. All three claim that some patents practiced by AV1 sit outside AOMedia’s license. AOMedia members operate as though the codec is free. A cautious operator should know the claim exists, and should know that a VDP license charges one royalty whichever of its four codecs you use.
The remaining real cost is the fourth lever: encoding. AV1 is heavier to encode than HEVC, historically several times slower. The gap has narrowed sharply. The SVT-AV1 encoder at its middle speed presets now encodes at roughly HEVC-software speeds while keeping most of AV1’s compression advantage, and version 4.0, released in early 2026, improved its compute-versus-compression trade-off in every mode (AOMedia, March 2026). But live AV1 still effectively requires hardware encoders, and a large VOD library costs more compute to convert. That cost is one-time per title and is repaid by lower egress on every view thereafter, which is why high-volume services adopt AV1 first.
Figure 2. The four codecs plotted by reach (how many devices play it) against efficiency (bytes saved). H.264 anchors the high-reach corner; AV1 is the one climbing fastest toward both.
VVC (H.266): technically best, commercially stalled
VVC, or Versatile Video Coding (H.266), finalized in 2020, is the most efficient codec in this article. In lab comparisons it delivers roughly 40–50% savings over HEVC, beating even AV1 by a meaningful margin — at 8K resolution, studies put VVC near 78% savings over H.264 against AV1's 63%. If efficiency were the only lever, VVC would already be everywhere.
It is not, for two reasons that map directly onto the other three levers. First, encode cost: VVC is dramatically heavier to encode than AV1 — independent comparisons put its encoding time at around three times AV1's — which makes large-catalog and live use expensive. Second, and more decisively, licensing and reach are both weak. VVC's patents are split across the Access Advance VVC pool (4,500+ patents) and the former Via LA pool, with a long list of essential patent holders — Apple, Google, Samsung, Qualcomm, Microsoft, and others — still licensing outside any pool as of early 2026. That fragmentation is the same problem that slowed HEVC, and it has kept VVC out of the browser and out of mainstream streaming entirely: six years after finalization there are still no major streaming-publisher deployments. Where VVC is gaining ground is broadcast and television. Brazil adopted its TV 3.0 (DTV+) standard, with VVC as the main video codec, in August 2025 and opened its first experimental TV 3.0 station in Brasília in April 2026. ATSC 3.0 added VVC in July 2025. Android 17 added a VVC decoding API, which works on phones whose chipmaker supplies a VVC decoder; Android ships no software VVC decoder of its own.
The product takeaway is the cleanest in this article: for an OTT streaming platform in 2026, VVC is a watch item, not a deployment. The efficiency is real, but the licensing fog, thin device reach in the streaming world, and steep encode cost mean it earns no place in a streaming catalog yet. We make the same case in more depth in our dedicated breakdown, H.266 / VVC: technically excellent, market-weak. Revisit the decision when browser support and a clear license arrive.
The same logic applies to AV2. AOMedia released the AV2 specification in June 2026 under its royalty-free patent policy and says AV2 compresses about 30% better than AV1 (AOMedia, October 2026). Google has demonstrated AV2 playback in Chrome, and YouTube plans to start AV2 on the web as soon as early 2027, but AOMedia has not named any AV2 hardware decoders yet. For a 2026 catalog AV2 is a planning item, not a tier. We cover the roadmap in AV2: what to expect from 2026 to 2031.
H.264 vs HEVC vs AV1 vs VVC licensing compared
H.264 has one pool, Via LA, with known but rising streaming fees. HEVC and VVC are split between Access Advance, which now also runs the former Via LA HEVC and VVC program, and patent holders who license on their own. AV1 is royalty-free from AOMedia, with third-party pools claiming otherwise. For a streaming service the new cost line is the streaming-distribution pool, which charges one royalty across HEVC, VVC, AV1 and VP9.
| Codec | Who licenses it (2026) | What a streaming service is asked to pay | Licensing risk |
|---|---|---|---|
| H.264 / AVC | Via LA (single pool) | Tiered annual streaming fee, up to $4.5M a year for the largest platforms on new licenses | Low: one pool, published terms |
| HEVC / H.265 | Access Advance (HEVC Advance + former Via LA program), Velos Media bilaterally, holders outside pools | Device pools: no royalty on streamed content; VDP and Avanci Video: streaming royalty | High: active litigation (InterDigital v. Disney, 2025–2026) |
| AV1 | AOMedia royalty-free license; Sisvel pool; listed in VDP and Avanci Video | Nothing to AOMedia; third-party pools claim a streaming royalty | Medium-low: claims exist, AOMedia members treat it as free |
| VVC / H.266 | Access Advance VVC Advance, former Via LA program, many holders outside pools | Device royalties; streaming covered by VDP and Avanci Video | High: fragmented, little deployment to test the terms |
Table 2. Codec licensing for a streaming service in 2026. A briefing for your legal team, not legal advice or a quote.
Streaming-pool rates swing widely with service size. Access Advance’s VDP pool charges in six tiers, from $0.0417 down to under $0.0082 per subscriber per month, and caps the total at $72 million a year. A March 2026 model by Streaming Learning Center, sponsored by Access Advance, put Avanci Video’s royalties at 1.9 to about 30 times higher depending on the size of the service (Streaming Media, April 2026). Avanci had not announced a cap for its video program at the time.
The four codecs side by side
The table below puts the four levers in one view. The "plays on" column is the coverage view that keeps you from adopting a codec your audience cannot decode — read it before the efficiency column, because reach is the lever you cannot trade away.
| Codec | Efficiency vs H.264 | Plays on (hardware decode, 2026) | Licensing | Encode cost | Natural OTT role |
|---|---|---|---|---|---|
| H.264 / AVC | Baseline (0%) | Everything — universal | Single pool (Via LA); tiered streaming fees up to $4.5M/yr for new licensees (2026) | Lowest, real-time | Universal floor; live default |
| HEVC / H.265 | ~40–50% smaller | Apple, most TVs/STBs, recent Android; browsers only with HEVC hardware | Access Advance (incl. former Via LA program) + outsiders; device pools charge no content royalty, streaming pools do | Moderate | Premium 4K/HDR tier on living-room devices |
| AV1 | ~50–55% smaller | iPhone 15 Pro+/16/17, M3+ Macs, Android flagships, most 2022+ TVs & sticks, Apple TV 4K (2026) | Royalty-free (AOMedia); third-party claims (Sisvel, VDP, Avanci Video) | Higher; live needs HW encoders | Efficiency tier; default for high-volume VOD |
| VVC / H.266 | ~65–75% smaller | Broadcast (Brazil TV 3.0, ATSC 3.0), Android 17 phones with a vendor decoder; not in browsers | Fragmented, many holders outside pools | Highest (~3× AV1) | Watch item — not for streaming yet |
Table 1. The four-lever view. Efficiency figures are approximate ranges from published comparisons and vary by content and quality metric; treat them as planning estimates, not guarantees. Verify licensing terms and device coverage live — both change.
The table collapses into a simple gate you can apply to each catalog tier: keep the H.264 floor, add AV1 where the device decodes it, fall back to HEVC for older living-room and 4K-HDR devices, and park VVC.
Figure 4. One gate per tier. The floor is unconditional; everything above it is "the best codec this device can actually decode."
The strategy almost every platform actually runs: a mixed-codec catalog
Here is the conclusion the four levers force: you do not pick one codec, you carry a small set, and you let each viewer's device pull the best codec it can decode. This is the mixed-codec catalog, and it is how Netflix, YouTube, and every serious streaming service operate.
The pattern is a floor plus an efficiency layer. The floor is H.264, encoded for every title, guaranteeing that any device on earth can play something. The efficiency layer is AV1 (and/or HEVC) encoded for the same titles, served only to the devices that can decode it. When a player loads a stream, it announces which codecs it supports, and the platform hands back the most efficient one on the list — AV1 to a 2024 smart TV, HEVC to an older Apple TV, plain H.264 to a decade-old tablet. The viewer never sees this negotiation; they just get a stream that plays. Each codec’s segments are encoded once and packaged as CMAF, so one set per codec serves both HLS and DASH players, the "encode once, serve everyone" idea covered in packaging: CMAF, HLS, and DASH from one mezzanine.
The cost of this strategy is that each codec multiplies your encoding ladder. Add AV1 to an H.264 catalog and you encode and store every title twice — more compute in the transcoding farm and more storage. The economics only work because storage is cheap and the egress savings on every delivered AV1 stream dwarf the one-time encode-and-store cost. That trade-off — extra encode and storage now, against lower delivery forever — is the same calculation behind per-title encoding, worked through in per-title and context-aware encoding: the economics, and it lives inside the full picture in the OTT cost model.
Figure 3. The floor-plus-efficiency pattern. H.264 reaches every device; AV1 and HEVC serve the devices that can decode them. The player asks for the best it supports.
A worked example: what an efficiency tier saves
Put numbers on it, because the efficiency lever is the one that pays for the whole exercise. Imagine a service whose viewers stream 10 million hours a month. On an H.264-only catalog, suppose the average delivered rung runs at 3 Mbps. The monthly egress is the bytes those hours add up to:
hours per month = 10,000,000 hr
average bitrate = 3 Mbit/s
data per hour = 3 Mbit/s × 3,600 s ÷ 8 = 1,350 MB ≈ 1.35 GB
monthly egress = 10,000,000 hr × 1.35 GB = 13,500,000 GB ≈ 13.5 PB
at $0.04 per GB = 13,500,000 × $0.04 = $540,000 / month
Now add an AV1 efficiency tier. Suppose 60% of those viewing hours happen on AV1-capable devices — a realistic share in 2026 given the device numbers above — and AV1 cuts the bitrate for equal quality by 40%. Those hours now stream at 1.8 Mbps instead of 3 Mbps; the other 40% stay on H.264 at 3 Mbps:
AV1 hours (60%) = 6,000,000 hr × (1.35 GB × 0.6 bitrate) = 6,000,000 × 0.81 GB = 4,860,000 GB
H.264 hours (40%) = 4,000,000 hr × 1.35 GB = 5,400,000 GB
new monthly egress = 10,260,000 GB
at $0.04 per GB = $410,400 / month
That is about $130,000 a month saved — roughly a 24% cut in the delivery bill — for the one-time cost of encoding and storing an AV1 copy of the catalog. As more of the audience's devices gain AV1 hardware decode each year, the saving grows on its own. That is the entire commercial case for a codec strategy: efficiency, multiplied by scale, paid once and saved forever.
A common mistake: betting the catalog on a single codec
The most expensive codec mistake is treating the decision as "which one codec?" instead of "which set?" It shows up in two opposite directions.
The first is over-conservatism: shipping H.264 only, because it is safe and universal, and paying 40–50% more egress than necessary on every modern device that could have taken AV1. At small scale this is invisible; at a million viewers it is a six- to seven-figure annual leak, exactly the one the worked example above closes.
The second is over-aggression: chasing the newest codec for everyone and cutting off the audience that cannot decode it. Encoding a catalog AV1-only in 2026 still strands the large installed base of older phones, budget Android devices, and pre-2022 TVs that have no AV1 hardware — and forcing those devices into battery-draining software decode is its own failure. The newest-is-best instinct is even more dangerous with VVC, where adopting it for streaming today means paying triple the encode cost to reach almost no one through an unresolved licensing fog.
The fix for both is the mixed-codec catalog: an H.264 floor you never remove, plus the most efficient codec each device can actually decode, with the player choosing. You add efficiency without ever subtracting reach. A related trap is forgetting that every codec multiplies your storage and transcode footprint, so adding codecs without a per-title or device-aware plan can erase the egress savings in encode-and-store cost — match the codec set to the devices and content you actually have, the theme of renditions per device.
Frequently asked questions
What is the best codec for OTT streaming in 2026?
No single codec is best. Most platforms run H.264 as the universal floor and AV1 as the efficiency tier, adding HEVC for older Apple and smart-TV devices and 4K HDR where AV1 is not decoded in hardware.
AV1 vs HEVC: which should a streaming service choose?
AV1 for most new catalogs: about 20–30% smaller than HEVC at equal quality, royalty-free from AOMedia, and decoded in hardware on most 2022-and-later TVs, recent iPhones and the 2026 Apple TV 4K. HEVC still covers older Apple devices, set-top boxes and many 4K HDR living-room setups that lack AV1.
Is AV1 really royalty-free?
AOMedia licenses AV1 royalty-free, but Sisvel and the two streaming pools, Access Advance VDP and Avanci Video, claim some AV1 patents sit outside that license. Netflix, YouTube and Meta stream AV1 at scale regardless.
Do streaming services pay royalties for H.264?
Yes, through Via LA’s AVC license. Since 2026, new licensees face tiered streaming fees that reach $4.5 million a year for the largest platforms, up from a flat $100,000 cap; existing licenses are grandfathered for now.
Should we encode in VVC or AV2 now?
Not for a streaming catalog in 2026. VVC has no browser support and fragmented licensing, and AV2, released in June 2026, has no named hardware decoders yet; YouTube expects AV2 on the web no earlier than early 2027.
How many codecs should an OTT catalog carry?
Usually two, sometimes three: H.264 for every title, AV1 for capable devices, and HEVC only if much of your audience watches on older Apple TV, iOS or set-top devices without AV1. Each codec adds a full encoding ladder, so add one only when its egress savings beat the extra encode and storage cost.
Free download: OTT Codec Strategy WorksheetOne page for choosing your codec set before you commit a transcode pipeline: weigh the four levers, set an H.264 floor, decide the AV1 or HEVC efficiency tier per device class, park VVC as a watch item, and run the egress-savings sanity check.Where Fora Soft fits in
The codec decision is where reach and delivery cost are set together, and getting it right at scale — across a catalog of thousands of titles, a dozen device classes, and an audience that grows from a thousand viewers to a million — is the kind of engineering Fora Soft has done since 2005, across 250+ shipped projects in video streaming, OTT/Internet TV, e-learning, telemedicine, and video surveillance. That work is precisely this: building the mixed-codec pipeline that adds an AV1 efficiency tier without dropping a single legacy device, wiring codec negotiation into the player and packager, and sizing the transcode-and-storage cost against the egress it saves. When a media company needs a streaming platform whose delivery bill survives a real audience and whose reach never strands a viewer, that codec-and-delivery engineering is the capability we bring. If you are setting that strategy for your own service, our OTT and Internet TV development team builds the mixed-codec ladder, packager and player negotiation end to end, and our video processing and transcoding engineers size the encode and storage cost against the CDN egress it saves.


The handbook
Fora Soft Video Engineering Handbook
We wrote a seven-volume handbook, 9,000+ pages, that works through the whole video stack from the pixel to production — encoding, delivery, audio and AI — so the codec call in this article rests on ground you can follow all the way down. Volume 1 carries this chapter furthest: how H.264, HEVC, AV1 and VVC actually compress, what those bitrate-saving percentages are measured against, and the quality metrics that decide whether “same quality” is true. Volume 3 prices the result in CDN egress, ABR ladders and the players that pick a rung, and volume 2 covers the HLS and DASH packaging that carries every codec you add. Written by Nikolay Sapunov, CEO at Fora Soft.
Which codecs belong in your catalog, and what would the second one save you?
Send us your device mix, your catalog size and your monthly viewing hours, and we will tell you which codecs earn a place, what an AV1 or HEVC tier takes off your egress bill at your scale, and what the extra encode and storage cost against it — then build the mixed-codec pipeline and the player negotiation that serves it. 250+ video products shipped since 2005.
See our case studies
Case study
Worldcast Live
HD concert streaming at 1.5 Gbit/s with 0.4–0.5 s latency for 10,000 simultaneous viewers — the scale at which one efficiency tier stops being a rounding error and starts deciding the delivery bill.
Case study
Smart IPTV for Android Set-Top Boxes
A white-label operator app on Android set-top boxes — live channels, EPG and VOD driven by a remote over the Stalker/Ministra API — the living-room hardware that is exactly why an H.264 floor stays in the catalog.
Case study
Speed.Space
A remote production platform recording at 1080p and 8 Mbit/s for Netflix, Electronic Arts and HBO shoots, where creators set resolution, frame rate, codec and bitrate per stream — the codec decision exposed as a product control.
What to read next
Encoding
The encoding ladder explained: renditions, resolutions, bitrates
Every codec you add multiplies this ladder — here is what a rung costs.
Economics
Per-title and context-aware encoding: the economics
The other way to cut bytes without ever touching reach.
Packaging
Packaging: CMAF, HLS and DASH from one mezzanine
Encode once, serve every player — what makes a mixed catalog cheap.
Transcode cost
Transcoding farm cost: cloud vs on-prem vs GPU
What the fourth lever actually costs when you add an AV1 tier.
References
- AOMedia AV1 Bitstream & Decoding Process Specification — Alliance for Open Media. The royalty-free AV1 specification and its licensing framework; the consortium membership (Google, Netflix, Amazon, Microsoft, Meta, Apple) that publishes it. Tier 1 (specification / standards body). https://aomediacodec.github.io/av1-spec/ (accessed 2026-06-16)
- ISO/IEC 23008-2 — High Efficiency Video Coding (HEVC/H.265) — ISO/IEC (and ITU-T H.265). The HEVC standard defining the ~50%-over-H.264 efficiency target. Tier 1. https://www.iso.org/standard/85457.html (accessed 2026-06-16)
- ISO/IEC 23090-3 — Versatile Video Coding (VVC/H.266) — ISO/IEC (and ITU-T H.266). The VVC standard. Tier 1. https://www.iso.org/standard/73022.html (accessed 2026-06-16)
- ITU-T H.264 — Advanced Video Coding (AVC) — ITU-T. The H.264/AVC standard, the universal reach baseline. Tier 1. https://www.itu.int/rec/T-REC-H.264 (accessed 2026-06-16)
- AV1 — Now Powering 30% of Netflix Streaming — Netflix Technology Blog (Dec 2025). AV1 at ~30% of Netflix streaming; 85% HDR-catalog AV1-HDR10+ coverage; 88% of certified large-screen devices (2021–2025) support AV1. Tier 4 (first-party engineering). https://netflixtechblog.com/av1-now-powering-30-of-netflix-streaming-02f592242d80 (accessed 2026-06-16)
- Access Advance Announces HEVC Advance and VVC Advance Pricing through 2030 — Access Advance (Jul 2025). HEVC Advance (29,000+ patents) and VVC Advance (4,500+ patents) pool scope and 2026 rate changes; no content royalty on streaming distribution in the device pools. Tier 4 (licensing administrator). https://accessadvance.com/2025/07/21/access-advance-announces-hevc-advance-and-vvc-advance-pricing-through-2030/ (accessed 2026-06-16)
- Performance Comparison of VVC, AV1, HEVC, and AVC for High Resolutions — MDPI Electronics 13(5):953 (2024). Peer-reviewed BD-rate comparison: ~78% (VVC), ~63% (AV1), ~53% (HEVC) savings over H.264 at 8K; ~25–29% VVC-over-AV1; encode/decode time multiples. Tier 5 (peer-reviewed). https://www.mdpi.com/2079-9292/13/5/953 (accessed 2026-06-16)
- The State of Streaming Codecs 2026 — Streaming Media (2026). Industry survey of codec adoption, AV1 device share, VVC's broadcast-but-not-streaming status (Brazil TV 3.0, ATSC 3.0, Android 17), and the licensing landscape. Tier 5 (institutional/analyst). https://www.streamingmedia.com/Articles/Editorial/Featured-Articles/The-State-of-Streaming-Codecs-2026-173838.aspx (accessed 2026-06-16)
- SVT-AV1 encoder performance vs x265 — Streaming/encoder community benchmarks (2025). SVT-AV1 at mid presets approaches HEVC-software encode speed; libaom 5–10× slower than HEVC; AV1 ~55% bitrate vs x265 ~67% at equal VMAF. Tier 6 (educational/benchmark). https://gitlab.com/AOMediaCodec/SVT-AV1 (accessed 2026-06-16)
- Sisvel AV1 Patent Pool — Streaming Media / ip fray (2024–2025). The third-party royalty claims that qualify AV1's "royalty-free" status. Tier 6 (trade press). https://www.streamingmedia.com/Articles/ReadArticle.aspx?ArticleID=139636 (accessed 2026-06-16)
- Alliance for Open Media Releases AV2 Codec — AOMedia (June 2026). AV2 specification released under AOMedia’s royalty-free patent policy; libavm reference software. Tier 1 (standards body). https://aomedia.org/press%20releases/Alliance-for-Open-Media-Releases-AV2-Codec/ (accessed 2026-11-06)
- AOMedia Sees Rapid AV2 Adoption Across the Video Ecosystem — AOMedia (Oct 22, 2026). AV2 ~30% more efficient than AV1; Chrome AV2 demo; YouTube AV2 on the web as soon as early 2027; 90%+ of YouTube catalog (watch-time weighted) in AV1 as of March 19, 2026; Meta on AV1 as top delivery format. Tier 1. https://aomedia.org/press%20releases/AOMedia-Rapid-AV2-Adoption-Across-the-Video-Ecosystem/ (accessed 2026-11-06)
- NAB 2026, Via LA, and the Future of NDI|HX — Streaming Media (Apr 13, 2026). Via LA AVC streaming cap moved from a flat $100,000 to tiers up to $4.5M a year for new licensees; existing licenses grandfathered. Tier 6 (trade press). https://www.streamingmedia.com/Articles/ReadArticle.aspx?ArticleID=174341 (accessed 2026-11-06)
- Access Advance’s VDP Pool is Rapidly Gaining Momentum — Access Advance (Sep 11, 2026). VDP covers HEVC, VVC, AV1 and VP9 under one royalty; 46 licensors; licensees incl. Meta, Alibaba, ByteDance, Roku, Tencent; six-tier rates. Tier 4 (licensing administrator). https://accessadvance.com/2026/09/11/access-advances-vdp-pool-is-rapidly-gaining-momentum/ (accessed 2026-11-06)
- Independent Report Compares Codec Royalty Costs Across Two Major Licensing Pools — Streaming Media (Apr 3, 2026). Streaming Learning Center model (sponsored by Access Advance): Avanci Video 1.9–30.3× Access Advance VDP by service size; VDP cap $72M. Tier 6. https://www.streamingmedia.com/Articles/News/Online-Video-News/Independent-Report-Compares-Codec-Royalty-Costs-Across-Two-Major-Licensing-Pools-174221.aspx (accessed 2026-11-06)
- Access Advance acquires Via Licensing Alliance’s HEVC, VVC patent pools — ip fray (Dec 15, 2025). Tier 6. https://ipfray.com/breaking-access-advance-acquires-via-licensing-alliances-hevc-vvc-patent-pools/ (accessed 2026-11-06)
- InterDigital wins another UPC injunction in streaming dispute with Disney — JUVE Patent (Jul 2026); InterDigital wins injunction against Disney over video encoding patents — TVBEurope (Jun 19, 2026); InterDigital secures third UPC injunction against Disney — Broadband TV News (Sep 4, 2026). Munich injunctions Oct 2025–Feb 2026, UPC injunctions Jun–Sep 2026 (HEVC); Disney withdrew 4K UHD/HDR in affected European markets. Tier 6 (trade press). https://www.juve-patent.com/cases/interdigital-wins-another-upc-injunction-in-streaming-dispute-with-disney/; https://www.tvbeurope.com/business/interdigital-wins-injunction-against-disney-over-video-encoding-patents; Broadband TV News article (broadbandtvnews.com, 2026-09-04) and Broadcast Now, “InterDigital wins eighth injunction against Disney” (Jul 2026) for the 4K/HDR withdrawal (accessed 2026-11-06)
- VVC support — Android Open Source Project (2026). Android 17 adds VVC decoding via vendor-provided decoders; no AOSP software decoder. Tier 1 (official documentation). https://source.android.com/docs/core/media/vvc (accessed 2026-11-06)
- Brazil adopts TV 3.0 — Ultra HD Forum; Brazil adopts ATSC 3.0 for next-gen TV — Advanced Television (Aug 28, 2025). VVC as TV 3.0 main video codec. Tier 5/6. https://uhdf.svta.org/brazil-adopts-tv-3-0-with-many-component-technologies-described-in-the-ultra-hd-forums-guidelines/; https://www.advanced-television.com/2025/08/28/brazil-adopts-atsc-3-0-for-next-gen-tv (accessed 2026-11-06)
- New Apple TV 4K Supports AV1 — iThinkDifferent (Oct 18, 2026). Fourth-generation Apple TV 4K (announced Oct 13, 2026), A19 chip with dedicated AV1 hardware decoding. Tier 6. https://www.ithinkdiff.com/apple-tv-4k-dedicated-av1-decoder-dolby-vision/ (accessed 2026-11-06)
- SVT-AV1 4.0 Boasts Major API Updates — AOMedia (Mar 11, 2026). Tier 1. https://aomedia.org/blog%20posts/SVT-AV1-4_0-Boasts-Major-API-Updates/ (accessed 2026-11-06)
- Google Chrome Plays HEVC: What Does it Mean? — Streaming Media (2022); Firefox 134 supports H.265 playback on Windows — GIGAZINE (Jan 8, 2025). Tier 6. https://www.streamingmedia.com/Articles/Editorial/Featured-Articles/Google-Chrome-Plays-HEVC-What-Does-it-Mean-155572.aspx; https://gigazine.net/gsc_news/en/20250108-firefox-134 (accessed 2026-11-06)
Source note (per §4.3.2): codec efficiency and reach claims trace to the standards (refs 1–4, tier 1) and a peer-reviewed BD-rate comparison (ref 7); adoption figures are first-party (ref 5, Netflix) and institutional (ref 8). Licensing facts trace to the pool administrator's own announcements (ref 6) with the contested AV1 claims labelled and sourced (ref 10). Efficiency percentages are content- and metric-dependent ranges, flagged as planning estimates in-text; no lower-tier source overrode a standard. The November 2026 updates (refs 11–22) trace to AOMedia, Access Advance and AOSP primary sources, with trade press used only for litigation, pool-rate modelling and device news.
