Chips&Media Signs Next-Gen ‘AV2’ Video IP Licensing Deal with North American Big Tech, Strengthening Global Standards Leadership

Chips&Media, a leading provider of video intellectual property (IP) solutions, has announced a strategic licensing agreement with a major North American technology company for its next-generation AV2 video codec IP. The agreement marks a significant milestone for the company as demand accelerates for advanced video processing technologies capable of supporting ultra-high-resolution streaming, artificial intelligence (AI)-enhanced media applications, cloud gaming, and next-generation content delivery platforms.

The AV2 codec, widely regarded as the successor to AV1, is being developed to address the rapidly growing bandwidth and efficiency requirements of modern video ecosystems. As video traffic continues to account for the majority of global internet data consumption, semiconductor companies and system developers are seeking more efficient compression technologies that can deliver higher quality video at lower bitrates while reducing power consumption and infrastructure costs.

Under the new agreement, Chips&Media will provide its AV2 hardware encoder and decoder IP cores for integration into custom system-on-chip (SoC) platforms targeting data centers, AI infrastructure, edge computing systems, and consumer devices. The licensing deal reflects growing industry confidence in Chips&Media’s ability to deliver standards-compliant video processing solutions with optimized silicon area, low power consumption, and high-performance throughput.

The AV2 architecture introduces significant improvements over previous codec generations. Early industry projections suggest compression efficiency gains of 30% to 50% compared to AV1, enabling content providers to reduce storage and transmission requirements while maintaining equivalent visual quality. Such improvements are increasingly important as 8K video, immersive media, virtual reality (VR), augmented reality (AR), and AI-generated content place unprecedented demands on network and compute resources.

Chips&Media’s implementation leverages a highly configurable hardware architecture that supports scalable video coding, advanced motion compensation techniques, adaptive transform processing, and AI-assisted encoding optimizations. The company’s design methodology allows customers to tailor codec configurations based on application-specific requirements, balancing performance, silicon area, memory bandwidth, and energy efficiency.

The licensing agreement also highlights the growing importance of dedicated video acceleration hardware in AI-centric computing environments. Large-scale AI models increasingly process multimodal data streams combining video, audio, and text. Efficient video compression and decompression have therefore become critical components of AI training pipelines, inference workloads, and real-time content analysis systems. Hardware-based AV2 acceleration can significantly reduce CPU and GPU utilization, improving overall system efficiency while lowering operational costs.

Industry analysts view the agreement as further validation of Chips&Media’s long-standing position within the global video IP market. The company has established a strong reputation for delivering production-proven codec solutions supporting standards including H.264/AVC, H.265/HEVC, VP9, AV1, and VVC. Its technology has been integrated into a broad range of semiconductor platforms used in smartphones, smart TVs, automotive systems, surveillance equipment, and cloud infrastructure.

The North American customer, while not publicly identified, is expected to deploy the AV2 IP across multiple product categories. Such deployments could accelerate ecosystem readiness as industry stakeholders begin evaluating AV2 adoption strategies. Early hardware support is often a key factor in driving codec standardization and commercial deployment, particularly in markets where performance and power efficiency are critical competitive differentiators.

Beyond the immediate business impact, the agreement reinforces Chips&Media’s role in shaping the future of video compression standards. Participation in emerging codec ecosystems enables the company to contribute technical expertise while ensuring that its IP portfolio remains aligned with evolving market requirements. As video applications continue expanding across AI, automotive, industrial, consumer, and cloud markets, advanced codec technologies will play a central role in enabling scalable and efficient digital media delivery.

Bottom line: With this latest licensing win, Chips&Media strengthens its global footprint and demonstrates its ability to secure design engagements with leading technology innovators. The agreement underscores the increasing strategic value of video IP as semiconductor companies prepare for the next generation of media processing workloads and standards-based video infrastructure.

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