Thanks for the complement.

Your question- “Is the free codec a moot issue at this point and DivX is definitely on it’s way to becoming a standard or is this still a very real threat to DivX future revenues?”

Upon first review it of course was, but with DivX excellent execution and it’s expansion into many new markets, so “MOOT” is just to strong of word, but in a couple quarters of this type of performance I think we could use it.

Randy

Can you clarify on your reply above, “Because it’s a free codec it at first looked attractive to me, but I’m not seeing where it’s managed properly, it’s hard to pay people when you make nothing, so the older DivX looks, from my review, one of many technology lost products.” Trying to understand what you mean by “the older DivX looks”? Is the free codec a moot issue at this point and DivX is definitely on it’s way to becoming a standard or is this still a very real threat to DivX future revenues? Thanks, love your blog site by the way!

Great question, we think alike

I happen to read your article about Divx INC at my friend’s site, the OSV. I had a question regarding a potential risk that might take away Divx’s moat and appeal. It has something to do with Xvid Codec. I don’t know if you already know what this codec is but it is essentially a free codec version of Divx’s software that packages high quality video files into small files. History goes, one disgruntled software engineer “Sparky” from Divx Network back in the day wrote encoding algorithm called ecore2. The Divx codec and Xvid codec both uses this encoding therefore it is know to the people of the tech world that Xvid codec files can be played with Divx Players and usable on all platforms and OS.

Now, I can see how companies may rather work with Divx due to their Brand Recognition, large media player implementation and most importantly DRM to prevent illegal pirating, but Xvid codec formating is free, compatible with much more platforms, has a large user base and quite possibly DRM-ready.

I’m concerned that Divx’s moat may be reduced and it’s ability to grow in the future would diminish. I feel Divx’s revenue which is primarily from licensing could diminish if companies opted to use this free codec rather than Divx’s.

Your opinion on this subject matter is greatly appreciated. I am still learning so any insight or information I maybe missing is welcomed.

Thank you very much.

SHM