Chips&Media Secures Major AV2 IP Licensing Deal

A Landmark Deal for Next-Generation Video

Chips&Media has announced a significant licensing agreement for its next-generation AV2 video IP with a leading North American technology giant. This move marks a crucial step in bringing the next wave of advanced video compression technology to market. The deal encompasses Chips&Media’s AV2 decoder IP and includes support for multiple established standards like H.264/AVC, H.265/HEVC, and AV1. This provides the customer with a comprehensive, future-ready hardware video foundation for their upcoming flagship products.

Why AV2 is a Game-Changer for Compression

The heart of this deal is the AV2 standard, developed within the Alliance for Open Media as the successor to AV1. Its primary goal is deceptively simple: deliver identical or superior video quality while using significantly less data. According to Chips&Media, AV2 can boost compression efficiency by approximately 20% to 30% compared to its predecessor. This leap forward is critical as video continues to consume the vast majority of internet bandwidth, and consumer demand grows for higher resolutions, faster frame rates, more vibrant colors, and reduced lag.

The Hardware Decoder Advantage

While new codecs like AV2 offer better efficiency, they come with increased computational complexity. The advanced algorithms that shrink file sizes also require more processing power. Relying solely on software to decode these streams can overwhelm a device’s main processor, leading to rapid battery drain, excess heat, and sluggish performance—especially on mobile phones, TVs, cars, and augmented reality devices. This is why dedicated hardware decoder IP is essential. It handles the heavy lifting of video decompression efficiently, freeing up the main system and saving power.

Chips&Media’s Role: Turning Standards into Silicon

Chips&Media specializes in transforming complex video standards into ready-to-use semiconductor intellectual property (IP). This licensable IP block allows chipmakers and large platform companies to integrate a proven video decoder directly into their system-on-chip (SoC) designs. This approach saves immense time and development cost compared to building a decoder from scratch. The inclusion of legacy codecs (H.264, HEVC) alongside newer ones (AV1, AV2) in a single subsystem is vital, ensuring devices can play both old and new video content seamlessly.

Market Impact: From Blueprint to Reality

A video standard only gains real-world influence when it’s built into chips. A licensing pact with a major industry player signals that AV2 is transitioning from a promising specification to a technology being prepared for commercial devices and content ecosystems. This alignment among device makers, streaming services, and semiconductor suppliers is what ultimately drives widespread adoption.

Benefits for Streaming and Cloud Services

This advancement is particularly relevant for streaming platforms like YouTube and Netflix, cloud gaming, video calls, and social media. All these services grapple with the balance between delivering higher-quality video and managing costs related to bandwidth, data storage, and energy. More efficient video compression technology directly reduces these operational expenses for providers while enabling better playback experiences for users, even on slower internet connections.

The Bottom Line for Consumers

For the end-user, the integration of AV2 hardware decoding promises tangible benefits: smoother playback of 4K and 8K video, longer battery life for mobile devices, and cooler, quieter operation of gadgets. This deal by Chips&Media is a key step in making those benefits a reality in future products.