It is widely believed that WebM would not standup to patent scrutiny like many open source efforts. Same for Ogg Theora which is also based on the VP8 CODEC...the W3C has said as much. Not sure what Google is trying to do with WebM but is seems like a bit of a red herring to perhaps slow things down a bit in the HTML5 area.
H.264 AVC is an ISO/IEC standard and this pedigree offers the consumer a level of protection that open source lacks. This is why you will never see an open source CODEC as a standard in something like DVDs. Once something gains primetime market adoption out come the patent claims. With no standards body behind it it will soon be a feast for lawyers.
There are reasons royalties are in place. You pay an MPEG 2 royalty every time you buy a DVD player. It protects those that invented the thing to those that buy it. To allow no royalties for free H.264 content in perpetuity is remarkable. WebM probably didn't have a chance for wide scale adoption anyway but this H.264 news has affectively killed it. Why would anyone support a format that is proprietary, owned and controlled by one company? Free or not, that is madness!
Remember, the only free cheese is in a mouse trap.
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