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answers:

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Part of a web application I'm working on turns text into speech and then turns the wav stream into a mp3 using LAME encoder.

How would one go about licensing the mp3 encoder with the company that owns the patent so we can redistribute the web application and still be legal and what could be cost be involved with that or would it be better to just drop the mp3 encoding and go to a different audio format?

MP3's work great but the patent problems with it are a REAL pain!

A: 

Maybe go with a less troublesome format? Aiff?

http://en.wikipedia.org/wiki/Audio_Interchange_File_Format

Derek P.
+4  A: 

This may be wrong, but this is what I've gathered. From Wikipedia: MP3#Licensing and patent issues:

A large number of different organizations have claimed ownership of patents necessary to implement MP3 [...] have many different expiration dates, ranging from 2007 to 2017 in the U.S [...]
See this big list and this informative article.

It seems the main patent-enforcing organization are Thomson Consumer Electronics and the Fraunhofer institute, whose website at mp3licensing.com lists some "royalty rates": US $5.00 per unit for encoding -- presumably that means that for every copy of your software you sell, they get $5. It's not clear what the notion of "unit" is for web applications. If you're simply using LAME encoder, are you infringing the patent directly? I don't know; I'm not a lawyer. Now you know why people want to stop/end/oppose software patents.

In my opinion, it is best to just avoid all this hassle and use an unencumbered format, such as Ogg Vorbis, or Speex (by the same Xiph.org) which is specifically tailored for speech, or others. You could also just use a lossless format like WAV or FLAC and leave the encoding to the users, but this would require huge downloads.

ShreevatsaR