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Disney sued for allegedly violating streaming video patents

Technology firm InterDigital says Disney improperly uses its patented streaming video techniques on Disney Plus, Hulu and ESPN Plus.

Technology firm InterDigital says Disney improperly uses its patented streaming video techniques on Disney Plus, Hulu and ESPN Plus.

(Stock image via Unsplash)
(Stock image via Unsplash)

InterDigital, a technology firm that specializes in artificial intelligence technology research and development, is suing the Walt Disney Company over allegations of patent infringement related to the entertainment giant’s three streaming services.

On Monday, InterDigital said their patented technology “enable(s) Disney to efficiently stream content and enhance the user experience,” but complained that Disney does not pay a license for use of that technology.



“We always prefer to sign license agreements through amicable negotiation, but we are committed to receiving fair compensation for our groundbreaking research, which allows us to continue to invest in the next generation of technology,” Jose Schmidt, the Chief Legal Officer at InterDigital, said in a statement.

The tech firm has brought patent infringement complaints against Disney in several forums, including U.S. federal court, state court in Brazil, regional court in Germany and the Unified Patent Court.



The specific technology involved in the dispute relates to video compression techniques, which allow Disney and other entertainment companies to offer high definition and ultra-high definition video content via smaller file sizes.

Uncompressed, InterDigital said a movie with a run time of 130 minutes would require 11.6 terabytes (TBs) of data, but their compression technique allows them to reduce the file size to around 14 gigabytes (GBs) of data — a file size that is 98 percent smaller compared to the uncompressed movie. InterDigital uses at least two video codecs — AVC and HEVC — to achieve smaller file sizes.



“Disney’s move into streaming has been one of the company’s recent success stories, helping it to build a business of more than 250 million paying subscribers across brands like Disney Plus, ESPN Plus and Hulu,” Eeva Hakoranta, the Chief Licensing Officer at InterDigital, said on Monday. “With the help of our innovation, Disney has created a profitable business spread across its multiple platforms and, in its most recent financial results, reported annual revenue of around $25 billion from its streaming businesses.”

In its 139-page complaint filed in federal court, InterDigital said it first reached out to Disney in 2022 about licensing its patented streaming technology

A spokesperson for Disney has not yet returned a request from The Desk seeking comment on the lawsuit, and it wasn’t clear when the company was served with a copy of the complaint or whether its lawyers had a chance to review it.

Disney is expected to report its fiscal first quarter (Q1) earnings later this month, which coincides with the period when companies report calendar Q4 earnings. Its earnings report typically includes various updates on the number of subscribers who pay for Disney Plus, Hulu and ESPN Plus, as well as revenue associated with those services.

During its Q4 earnings report last year, Disney said its direct-to-consumer streaming business earned $5.783 billion in revenue, of which $321 million was profit.

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About the Author:

Matthew Keys

Matthew Keys is a nationally-recognized, award-winning journalist who has covered the business of media, technology, radio and television for more than 11 years. He is the publisher of The Desk and contributes to Know Techie, Digital Content Next and StreamTV Insider. He previously worked for Thomson Reuters, the Walt Disney Company, McNaughton Newspapers and Tribune Broadcasting. Connect with Matthew on LinkedIn by clicking or tapping here.
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